<< Back to all Blogs
Login or Create your own free blog
Home > Archive: February, 2008

Archive for February, 2008

$15,500 Lighter

February 28th, 2008 at 06:57 am

I got a brand new Toyota Yaris Sedan sitting in the drive way. The money scale says I'm $15,500 lighter. I put $4500 down and got an $11,000 loan for 3 years at 5.55%. I'm looking to pay it off in 12 months with payments of about $1000 a month. On top of our refinance mortgage at $1700 a month, we'll need to tighten our belt a little bit. The other big hit is the extra $80/mo for insurance. Our take home pay is about $4600, so we still have $1800 for regular expenses, but it will be interesting to see how we'll manage.

BTW the Yaris is a nice little car. 35 mpg, so we'll save some on gas.

What is a Toyota Yaris Sedan

February 26th, 2008 at 06:42 am

A: The car I am going to buy.

A combination of JD-Power ratings, test drives and price have led me to decide on the Yaris Sedan. I finally decided on it because it's built here in the U.S. apparently. I have been soliciting offers from about 10 dealers in the area. We're hoping on getting a deal in the low $15K, and we're planning to put about $5K down. We are going for a "cheaper" model, but with all the "basic options" like power locks, windows, cruise control etc. BTW, I despise car dealers...

Recession, say what?

February 22nd, 2008 at 07:45 am

So, I have heard people say that there's already a recession. But mind you, a recession actually has a technical definition: 2 consecutive quarters with negative GDP growth. Now, I concede, macroeconomics is a fairly difficult to understand subject, and I'm no expert at it. But I do think it's obvious, that, for some people, the economy has a worse impact than for others, and for that reason they're quick to use the 'R' word.

I just got my Tax refund, so I must say that I feel I have not been negatively affected by the economy. In fact, it allowed me to refi my mortgage at a great rate, and I feel like I'm better off that way. Now, don't get me started on the lower yield rates, but I don't think that has that much of an impact on me, you know maybe $5 or $10 a month, but nothing big.

But who needs money, when you have a wonderful wife?

Proud of our plastic use this month

February 20th, 2008 at 11:29 am

We usually rack up at least $1800 (Usually more than $2000) on our credit cards during a month. It counts for about 75% of our non-mortgage spending (i.e. groceries, gas, bills, clothing, etc.). Almost three weeks into the month we're still under $800! Hopefully we can finish the month below $1200, but I'd be happy if it was under $1500.

I need a new car

February 18th, 2008 at 06:02 am

This morning I couldn't get my car started. I know the problem: yesterday it was warm (well, relatively, 40F) and humid; a lot of water condensed on the parts inside the distributor; the temperature dropped to the mid twenties; the condensation on the distributor parts froze.

Anyway, I just used the brute force method and cranked the starter motor for a full half minute until all the ice came off the distributer and the engine finally turned over. A good thing I have a good battery. If I had a second car, I would replace the distributor in a heartbeat, but I feel uncomfortable messing with my only mode of transportation. Especially in the winter.

The last time I did a mundane job on my car; change my front brake pads and rotors; I snapped off the heads of a couple bolts, which I had to drill out and re-tap. This job that should take an hour at most, took me almost 6 hours instead. Now I'm very hesitant to work on this piece of junk car myself again (it is 12 years old by now...).

In any case, so I need another car. I'm looking in the $15K-$20K price range. This means I'm look at cars like the Corolla, Cobalt/Malibu, G5/G6, Civic etc. However, I wish it was so easy. When I go online to price cars, and I call the dealership, they have entirely different prices. Anyway, knowing myself, I know I won't get to buying an actual car for at least another couple months.

Prosper Part II

February 13th, 2008 at 06:13 am

So I have been doing some more research on Prosper lending. Basically Prosper is the same lending as banks do, but your return is lower than the bank's return because:

A) Prosper takes a piece of the pie
B) Interest rates are slightly lower than the bank's for several reasons (one of them being that people wouldn't borrow on prosper if they can get lower rates somewhere else)

The net yield, however, may be on par or higher than the bank's because banks have big overhead costs, here Prosper takes care of the overhead.

Secondly, there's the question of default risk. I couldn't say whether the default occurrence at prosper is higher or lower than those seen by commercial lenders. Certainly, it might be argued that the credit verification process that commercial lenders do is more sophisticated, and therefore safer. But many are of the opinion that the difference is not much different. Certainly, if there were no default risks, one could yield almost 20% at prosper, but even after defaults, most people I've read about have made over 10% yield through diversification.

I'm still waiting for my funds to go through. Then I'll start dipping my toe in the Prosper pool.


February 12th, 2008 at 08:36 am

Has anyone used prosper to lend money and get a higher return on their money? I've decided to check it out with a small amount ($1,000) of money, if my return stays above 5%, I might invest more. They say that the average return rate is close to 10% I'm just wondering why there are so few people using it.

Taxes finally done.

February 11th, 2008 at 06:34 am

I'm still waiting whether I can actually get the lifetime education credit of $1600, however I'm expecting not. I don't even know how it works 'cause I'm just click yes/no buttons on the tax software. Regardless, if I do get it, and I'm not supposed to, I'm still thinking I'd probably be audited, 'cause I have been each of the last 3 years. One time I owed money, one time they owed me money, one time neither owed anything.

Those Appraisers...

February 8th, 2008 at 10:38 am

I don't know what you have to do to become a real estate appraiser, but I know you don't have to do much once you become one. I had our house appraised today, and the guy was in our house for literally 5 minutes, and outside for 2 minutes. We pay $400 for the appraisal. Now; I know that they still have to plug in some numbers into the computer and so forth, but, seriously, how long can that take. Probably not more than 20 minutes. In any case it looks like our house value is going to drop to $165,000 while Zillow says $160,000. We'll probably be paying PMI for a year or so....oh well, such is the housing market.

Shoveling snow is good exercise

February 7th, 2008 at 06:52 am

We've had about 12" of snow over the last 24 hours. We have about a 80 ft double drive way. With less snow (1"-4") it usually takes me about 15 minutes. Yesterday it took me 45 minutes, so it made for good exercise. This morning I spent another 10 minutes on it because about 1.5" fell overnight. Although it's good exercise, I don't know how good it is for my back. I'm still paying $200 a year for a gym membership, but if it were snowing every day, I wouldn't need one.

786 and counting...

February 6th, 2008 at 07:37 am

My credit score just got bumped a little to 786 (Experian Plus Score out of 830). From experience I know that the fico scores are a little higher than that, so hopefully I have crossed the 800 barrier by now. I think it pretty good considering I only have 6 years worth of credit history. Hopefully I can keep it up this high for another 6 years.

Oh, that escrow...

February 5th, 2008 at 06:47 am

My credit union 'under-charged' me for my escrow payments. We just got a 10% increase in property taxes. We were under charged $50/month, so our payments will increase by $100/month. $50 to make up for what we owe and $50 extra for the projected increase in property tax.

By the way, we pay $4,500 in property taxes each year on a property valued at $65,000 (for tax purposes). People tell me that is a lot. Is it?

Best month ever...

February 1st, 2008 at 08:04 am

Like they like to say on wall street. We finally got our spending a little bit under control. The balance statement reads as follows:

Income: $5,934
Expenses: $3,450
Balance: + $2,483

The goal, however, is to get the non-mortgage expenses under $1800. Now it's at $2200. February is the perfect month to reach that goal. So here are the goals for february:

Income: $4700
Expenses: $3100
Balance: + $1600

Here is where we will look to save money this month:
Utilities: From $377 to $250 save $127
Clothing: From $259 to $150 save $109
Groceries: From $599 to $400 save $299

That will save us $535. Enough to cover the $400 dollar savings goal.