Links to Carnivals from December 22 to 28, 2009

Here are the links to the Carnivals in which My Wealth Builder participated from December 22 to 28, 2009:

Money Hacks Carnival #96

Carnival of Financial Planning #121

Carnival of Money Stories

For some interesting articles from the blogosphere, check out these Carnivals and give the hosts some recognition for their hard work.

For more on Ideas You Can Use, check back every Tuesday for a new segment.

This is not financial, saving or tax advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Taking Qualification Tests to Increase Compensation

When I was working full time, level advancement and pay increases was primarily determined by management decision and evaluation, which can be subjective. Since retiring, I've noticed some jobs use objective methods to do non-management advancements and pay increases.

For example, my seasonal part time job offers compensation increase for experience (i.e. years of service) and certification level. In the past, higher certification levels were achieved by completing company developed courses, but increases were limited to two each year. It would take nearly six years of course hours to reach the highest level. This year, the company changed the certification process from education hours to passing an administered test. In addition, there is no longer a limit to the number advancement levels I can achieve in one year.

My goal this year is to advance as many levels as possible. Although I waited until November to begin, I've already passed four certification tests, putting my level one year ahead what was possible in the previous system. I plan to keep taking tests until I don't pass, or the deadline occurs, which is December 31, 2009. At my current level, I've increased my compensation about 10%. If I am fortunate enough to qualify for and advance four more levels, my compensation will increase about 25% in 2010.

For more on Strategies and Plans, check back every Monday for a new segment.

This is not financial or career advancement advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Recession Silver Linings

Although the recession has been tough, there have been some expected and unexpected benefits. Here are a couple that I've seen:

As might be expected, prices for many things seem to be getting lower. I've personally noticed and taken advantage of off peak dinner deals and happy hour beer prices lower than in a store
Similarly, lower housing prices were also predicted. Housing Affordability Hovers Near Record-High Level for Third Consecutive Quarter reports that housing affordability is at the highest levels since the index was started 18 years ago.

However, this societal benefit was unexpected. Recession’s good news: Cities see burglaries fall by the Associated Press at MSNBC.com reports how burglaries have have fallen by 15 to 25% in many cities, a surprising outcome given the state of the economy. The article speculates the reason may be related to the job loss during the recession. More people are at home now during the day, creating less opportunities for a burglar and providing more neighborhood watchers during working hours.

As the recovery continues, it is likely the benefits will disappear. So I'm going to try to enjoy them before the recession silver linings go away.

For more on Reflections and Musings, check back every Saturday for a new segment.

This is not financial, real estate or crime protection advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Merry Christmas 2009

I'm looking forward to a festive day and a fun weekend. We'll be celebrating Christmas with my in-laws, and exchanging our family presents. This Sunday, we'll be hosting my spouse's extended family holiday gathering for the second year.

Wishing you and your family a Merry Christmas and prosperous New Year.

For more on Reaping the Rewards, check back every Friday for a new segment.

This is not financial or holiday advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Streamlining our Christmas Traditions

For Christmas 2007, we started our own set of Christmas traditions and in 2008, we added a family Christmas tradition from my childhood. In 2009, we continued the same traditions, didn't add any new ones, and worked on streamlining the Christmas Eve events.

For reference, our Christmas Eve tradition is to attend an early church service and then take a drive, which enables Santa Claus to make an early visit to our house. In 2008, we had not thoroughly considered the process, which resulted in a less than perfect execution of the tradition. The problem was the church service ended about an hour before darkness. As a result, we needed one hour of activity before taking a drive. We chose to have dinner at a local restaurant. While we enjoyed eating out, it didn't give us enough time to prepare for Santa's visit.

This year, we decided to have dinner at home after attending Christmas Eve service. That enabled us to adequately create evidence of Santa's visit, which involved putting out the presents, eating the snacks by the fireplace and leaving a Santa note for our daughter. For our drive, we toured a holiday light show, and then returned home, while looking for Santa's sleigh in the sky. Our daughter cautioned us not to look too hard, as it might scare Santa from visiting :-)

When we arrived home, our daughter quickly went to the fireplace to check on whether Santa had eaten the snacks. She excitedly exclaimed, "Santa came and he left me a note!" Darn, we didn't get our camera out in time to capture that moment, but we were able to get it in time for the present openings.

Overall, this year's Christmas traditions were done pretty well. Next year, we'll need make sure the camera is ready when we arrive home on Christmas Eve :-)

For more on Crossing Generations, check back every Thursday for a new segment.

This is not financial, parenting or holiday advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Ways to Keep from Growing Wealth

7 surefire ways to stay poor by Liz Pulliam Weston at MSN.com shares seven money management issues that can keep people from accumulating wealth :

Spending too much of one's income on the large expenditures, e.g. rent/mortgage.

Confusing needs and wants.

Basing purchase decisions on monthly payments.

Failing to track the money flow.

Carrying credit card debt.

Living paycheck to paycheck.

Cashing out retirement accounts.

Overall, I agree with Ms. Weston. To me, these issues are money drains that can significant decrease wealth. Our personal solutions to these issues are to : 1)pay ourselves first, and 2)live below our means, which I shared in Strategies for Building Wealth and Retiring Early.

For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial, budgeting or saving advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Links to Carnivals from December 15 to 21, 2009

Here are the links to the Carnivals in which My Wealth Builder participated from December 15 to 21, 2009:

Carnival of Road to Financial Independence #14

Money Hacks Carnival #XCV

Baby Boomer's Blog Carnival #18

Boomer's and Seniors News You Can Use Carnival

Cavalcade of Risk #94

Carnival of Financial Planning #120

The BoBo Carnival of Politics

Carnival of Personal Finance #236

Tax Carnival #61

Carnival of Twenty-Something Finances

For some interesting articles from the blogosphere, check out these Carnivals and give the hosts some recognition for their hard work.

For more on Ideas You Can Use, check back every Tuesday for a new segment.

This is not financial, saving or tax advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Diagnosing the Cause of Leaks from our Water Heater

Last week, I checked in our utility room and saw a couple of small puddles below our gas water heater. I though, "It's finally time to replace our water heater." As background, it is the original water heater in our house, which was built 21 years ago. Until now, we haven't had any major issues with it. Two years ago, the pilot light went out, but I was able to re-light it. Last summer, I drained the tank, for the first time in five years, and there was no sediment in the tank.

Thinking that the water tank was leaking, I checked the Internet to confirm my diagnosis. To my surprise, I found three possible causes of the puddles. The first was a tank leak, which would require replacing the water heater. The second was condensation resulting from cold water filling the water heater, which is a normal occurrence in cold months. The third was a valve leak, which might require tightening or changing the valve. Since valve connections were dry and the puddling occurred shortly after a bath was drawn, I thought the water might be due to condensation.

As a precaution, I got an Internet estimate for replacing our water heater from a local retailer. Afterwards, I called the store to confirm the estimate of $1069 and asked a few questions.

Q. About how long do water heaters last?
A. About 12-13 years.

Q. Can puddles be caused by condensation?
A. Yes.

Q. How can I tell the difference from a leaking tank?
A. Puddles from condensation disappear. Puddles from leaks are always there.

That was enough information for me to do the final trouble shooting. Within a day, I confirmed that the puddles were disappearing, meaning we did not have a leak. Thus, for now, the water heater is still functioning well and we won't be replacing it.

For more on Ideas You Can Use, check back every Tuesday for a new segment.

This is not financial or maintenance advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

Strategies for Building Wealth and Retiring Early

At a recent holiday gathering, I ran into a friend who had also retired in his forties. We compared notes on what strategies enabled us to retire early. There seemed to be two recurrent themes in our discussion:

Paid ourselves first. Essentially, we put money in savings before paying bills and other spending. I have posted before about why I believe this is a great saving strategy, which has helped us build wealth.

Lived below our means. Our lifestyles were a conscious decision. Even though we could afford more, we would have lifestyles that were below our peers. We would drive less expensive or used cars, live in moderate housing, and avoid extravagances. As a result, we didn't use debt to expand our lifestyle.

Even in these economically challenging times, he and I have managed to stay in early retirement, for four and two years respectively. I'd like to think it is the results of a good execution of the above two strategies :-)

For more on Strategies and Plans, check back every Monday for a new segment.
This is not financial advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC

The Mortgage Refinance Dilemma

Despite Low Mortgage Rates, Homeowners Can't Refinance by David Streitfeld of The New York Times reports the difficulty of refinancing a home mortgage due to declining home values. Even though a homeowner is current and can make the lower payments on the new mortgage, the lender won't refinance the mortgage since the property is below the value of the mortgage. So it appears the lender would rather have the owner potentially walk away from the higher interest loan, than give the person a lower fixed rate mortgage at the same amount of principal.

I had a similar experience with our lender, but for a different reason. Since taking early retirement in 2007, we have been living off our savings, both principal and earnings. Our income from wages, interest and dividends is low, which is what our bank considers when make the loan. The bank does not include income from capital gains, e.g. the sale of stock, since the amount is not predictable. Thus, even though we were comfortably making payments, had 60% equity in our home, and enough cash to pay off the mortgage, our lender would only qualify us for less than 1/2 of the remaining principal, based on the predictable sources of income, wages, interest and dividends. Our decision? We simply paid off our mortgage in May, 2009.

While I understand the basis for the lender's decisions, it doesn't meet my standards of common sense logic. Since the loan already exists, why not refinance the existing principal to a lower monthly payment, especially if the owner has a job or liquid assets to cover the monthly payment? In my opinion, during the housing boom, many lenders ignored common sense logic and lent money to borrowers with insufficient income or savings, and now during the housing bust, lenders are again ignoring common sense logic and not lending to people with sufficient income or assets to comfortably make the payments.

That seems to be the nature of bubbles, i.e. standards are too loose during expansion, and stanards are too tight during recovery.

For more on New Beginnings, check back every Sunday for a new segment.

This is not financial advice. Please consult a professional advisor.

Copyright © 2009 Achievement Catalyst, LLC