Shorted a Second Stock

Last week, I shorted a second stock in our taxable investment portfolio.  I'm planning on shorting a third stock in the next couple weeks.  I don't understand how the market can keep rising despite earnings declines (that beat lowered estimates),  a looming rejection of the EU austerity program, and weak U.S. economy.

I know I'm going against market direction and expert opinion, which appears to support  a continuing bull market. So I'm either wrong or early and I expect to find out soon.

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


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

Copyright © 2012 Achievement Catalyst, LLC

Reflecting on the Amount of Time Left

In Looking for Fifteen More Good Years, I estimated that my health and physical capabilities would be relative good for another 15 years.   Today, I was thinking what 15 years was in other time increments:  5478 days (including 3 leap years) or 131,472 hours.  Of course, about 1/3 will be spent sleeping, which leaves 87,648 waking hours.

While 87,648 hours sounds like a lot, it really isn't.  For example, if I do something for one hour a day, that will use up 1/16 of the remaining waking hours or 5478 hours.   So actively choosing how I spend my time will be an important exercise to get the most out of those fifteen years.  

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

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

Copyright © 2012 Achievement Catalyst, LLC

Links to Carnivals from April 17 - 23, 2012

Here are the links to the Carnivals in which My Wealth Builder participated from April 17 - 23, 2012:

The Wealth Builder Carnival #73

Cavalcade of Risk #155

Baby Boomers Blog Carnival #138

Carnival of Personal Finance #233

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

This is not financial, risk or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

The Wealth Builder Carnival #74

Welcome to the seventy-fourth edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic. For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized into seven categories: Earning, Insuring and Protecting, Investing, Living Frugally, Retiring, Saving and Taxes. Unfortunately, Blog Carnival was having some technical difficulties two weeks ago, which may have limited the number of submissions.

And now on to the Carnival:

Earning

Shamelle presents YouTube Video Money How To Make Money Off YouTube Videos posted at Promote Youtube Videos, saying, "YouTube is the largest and most popular online video website, providing free access to a wide variety of videos.You can promote your affiliate products, monetize videos and earn cash. Here are steps on how to make money on YouTube with affiliate products."

Investing

Theresa Torres presents 7 Smart Ways To Invest $100 posted at Go Banking Rates, saying, "Investing isn't only for the rich as most of us probably think. There are several ways where ordinary folks like us can make a $100 now benefit us later."

Dividends4Life presents March 2012 Pocket Change Portfolio Performance posted at Dividend Growth Stocks, saying, "The Pocket Change Portfolio (PCP) was first introduced on September 13, 2008 as a real money dividend income portfolio funded by the "pocket change" earned from my various online endeavors. Each month I report on the portfolio's progress and update its holdings."

Living Frugally

Chase Dumont presents Don't Lend Money posted at Chase Dumont, Rainmaker, saying, "An Aesop's fable and a verse from Shakespeare sum up the wisdom on why lending money to friends and associates is usually a bad idea."

Jeremy Biberdorf presents Establishing Spending Priorities posted at Modest Money, saying, "Depending on your financial situation, you may need to make some sacrifices. At the same time, you don’t want to let your budgeting prevent you from enjoying the things you love. To stay happy you need to establish spending priorities and spend a bit where it makes you happy."

Retiring

Super Saver presents Going to Have A Lot of Free Time posted at My Wealth Builder, saying, "My retirement part time work load is going to be significantly lower after this month."

Taxes

Edward Webber presents How much Can you earn in 2012 posted at Tax Return Blog, saying, "Often people do not realise that they can earn a certain amount before paying any tax. This article explains how much you can earn in 2012 without paying any tax."

That concludes this edition. Submit your blog article to the next edition of The Wealth Builder Carnival using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Technorati tags: the wealth builder carnival, blog carnival.  

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

This is not financial, earning, insuring, investing, living, retiring, saving, tax, or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

For More Opportunity, Go East

My parents immigrated to the United States because the opportunities were much better here than in their home country.  Today, I'm not so sure my parents would choose to come to the United States.  Instead, I think they would be looking to immigrate to China or another Asian country, where there is much more opportunity and where success is considered to be a positive.   I fully expect that our seven year old daughter will spend most of working life outside of the United States, because that's where the future business growth will be. 

Here's some anecdotal information on why job seekers should look outside the U.S.   At a White House meeting, President Obama asked Steve Jobs about what it would take to bring back manufacturing of Apple products, which is nearly all done in Asia, back to United States.  Mr. Jobs replied, "Those jobs aren't coming back."   Recently, the Associated Press reported that 1 in 2 new graduates are jobless or underemployed.  Unfortunately, many of those jobs that college graduates used to get aren't coming back either, even when the Great Recession.

If our daughter does work overseas, I would seriously consider selling our house and living with her on the expatiate assignment, if possible.

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


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

Copyright © 2012 Achievement Catalyst, LLC

My Parents' Estate

Now that both our parents have passed away, my sister and I have the task of closing their estates and transferring their assets to the heirs, which are my sister and me.    Being a person that was highly involved in personal finance, Dad created a lot of complexity for their financial assets.   My parents had revocable living trusts, stock brokerage accounts, IRAs,  Roth IRAs, numerous dividend reinvestment plans (DRIPS), land, a real estate partnership and a home.    So it will take some time to contact all the various organizations to transfer title, and we will need to get their home cleaned up to prepare for selling.

It's good that my part time retirement jobs are mostly ending in April and completely ending in May.  I expect that working on my parents' estate will require a significant amount of my time over the next few months.

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


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

Copyright © 2012 Achievement Catalyst, LLC

Why a Greek Default Doesn't Matter - And Why Spain's and Italy's Will

Recently, I was talking to a hedge fund manager about the stock market.  I told him I didn't see how the market was holding up with the imminent default of Greece.  His comment was that he wasn't worried about Greece  since its GDP was about the size of a state in the U.S.  His point was the world economy could absorb the default of a state, so the world economy could absorb a default by Greece.

For reference, the GDP of Greece is in between Indiana and Maryland, the 16th and 15th states in terms of GDP.   I guess he's right.  If Indiana or Maryland defaulted, that would barely be a blip in the world economy.  However, the GDP of Spain is about the same as California's and the GDP of Italy is almost equal to those of California and New York combined.  

I suspect California or California and NewYork defaulting might have some impact on the world economy. So I think the lack of resolution for sovereign debt issues could still cause a major economic issue in the near future.   I plan to continue staying out of the market until there is better visibility on the EU debt issues.

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

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

Copyright © 2012 Achievement Catalyst, LLC

Countdown to Re-retirement

Two jobs down and two remaining.   Last week my seasonal part time financial services job ended, making it the second termination in April.  My first "termination" was in early April, when the tutoring company took me of the list of college exam prep teachers, which means I have virtually zero probability of getting a getting another assignment. My next job finishes permanently at the end of April and the last job concludes with the completion of school at the end of the May.  At that time, I will be retired ... again.
For more on Reaping the Rewards, check back every Friday for a new segment.

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

Copyright © 2012 Achievement Catalyst, LLC

The Ah-Ha Moments

In last week's soccer game, our seven year old daughter was playing noticeably different.  For three years (six seasons), our daughter has been an involved, but not committeed, soccer player.  Although she was often running after or near the ball, she would rarely try to get  or take control of the ball.   However, in the first game of this year, she is already playing at a much higher level.

In the first quarter, our daughter was aggressively playing for the ball and challenging the opposing team, which she routinely avoided in the past.   She also took control of the ball several times.  Finally, she scored her first goal, which also happended to be the first team goal, in the first quarter of the first game :-)  Clearly, our daughter had one of those Ah-Ha moments about what she should be doing in soccer.   Hopefully, she will maintain this playing attitude for the rest of the season :-)

For me, I can remember a couple Ah-Ha moments that have made a difference in my personal finances.   The first was in high school academics.   Up until high school, I had been a slightly above average student, getting good (in the B to A range) but not particularly stellar grades.   In high school, I soon learned that studying harder would lead to better grades.   I ended up having a 4.0 average (in the days when an A in AP classes was still only a 4.0) and graduated as one of the valedictorians.  (For reference, I also was the starting fullback on our state championship football team.  So I wasn't just studying all the time.)  While I didn't realize at the time, getting great grades helped me get into college of my choice, get a degree in engineering which led to a higher paying job.

The second was Ah-Ha moment was 12 years after I started working.   I was a "middle third" employee, as one supervisor rated me, meaning I was somewhere just above or below average.  (I suspect he meant below, but didn't want to tell me:-)  At year 12 I realized that I didn't want to be at the same level 20 years in the future.  That realization enabled me to make significant changes that led to a career turning point which resulted in advancing two levels and a significant increase in compensation.

Now, some readers are probably thinking, "Doh! These Ah-Has seem pretty obvious and self evident."  Maybe so to others, but not to me before my Ah-Ha moment.  But once I had the Ah-Ha, it made a significant difference in my life.

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

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

Copyright © 2012 Achievement Catalyst, LLC

High or Low Involvement - Which is better?

 After five and a half year of blogging about personal finance, reading other personal finance blogs and working in a seasonal financial services job, I've observed a wide range of  involvement in personal finances.
At one extreme are the high involvement people.  Their personal finances tend to be higher maintenance, requiring a lot of effort. At the other extreme are the low involvement people, who tend to have low maintenance personal finances.  Of course, there are the people who are in between the extremes.

Let me provide some examples for the extremes:

High involvement.   People who do high involvement personal finances tend to have lots of different stuff which needs constant managing.  Some examples are rental properties, actively managed stock and bond accounts, maximizing interest on savings and checking accounts, and credit card arbitrage.  Each these elements require effort from the owner on a daily or weekly basis.  Inevitably, the income results in a more complex tax return.

Low involvement.  People with low involvement personal finances tend to have one or two sources of income.  For example, having only a job, pension or social security as a source of income and only one savings and checking account would be low involvement.

Which is better? To me, there isn't a straight forward answer; it depends on the person and the results.  When I was younger, I liked doing high involvement personal finances.  While I never did credit card arbitrage, I did do many of the other elements. High involvement made me feel I was contributing to improving my personal finances :-)As I've gotten older, I've shifted to preferring low involvement options.  Fewer and simple is better for me.  So I have eliminated some of the higher maintenance items.  At this point,  I am still somewhere in the middle but I will probably continue to move to more low involvement options as I get older.

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

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

Copyright © 2012 Achievement Catalyst, LLC

Links to Carnivals from April 10 - 16, 2012

Here are the links to the Carnivals in which My Wealth Builder participated from April 10 - 16, 2012:

The Wealth Builder Carnival #72

Sports Carnival Ecstasy

Carnival of Financial Planning #232

Top Personal Finance Posts of the Week

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

This is not financial, sports or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

The Wealth Builder Carnival #73

Welcome to the seventy-third edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic. For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized into seven categories: Earning, Insuring and Protecting, Investing, Living Frugally, Retiring, Saving and Taxes. Unfortunately, Blog Carnival was having some technical difficulties in the last week, which has significantly limited the number of submissions.

And now on to the Carnival:

Earning

John presents 5 Ways to Make Your Job Application Stand Out posted at Wallet Blog, saying, "If you want to manage your personal finances, you probably should pay attention to acquiring personal finances. Finding the right job is key, but getting noticed over the competition is even more important. Job hunting is not just for the unemployed. This is good advice on any front!"

Super Saver presents Earn Large, Live Small posted at My Wealth Builder, saying, "Here's my simple strategy to building wealth: maximize and grow earnings; live at least 20% below those earnings. Building wealth is all about earning large and living small. To me, many people make the mistake of doing the opposite: earning small and living large."

Investing

Theresa Torres presents Smart Ways to Invest Your Tax Refund posted at The Missouri "taxguy", saying, "Rather than spending your tax refund on unnecessary things, consider making good use of it in these smart ways so that you can be more financially stable."

Dividends4Life presents 10 High-Energy, High-Yield Dividend Stocks posted at Dividend Growth Stocks, saying, "As the world's population increases and third-world countries continue to develop, there will be more intense demand on our finite supply of energy. This week week, I screened my dividend growth stocks database for energy companies with a yield at or above 3% and have increased their dividends for at least 10 consecutive years."

Living Frugally

What Next presents Old Men in Fast Cars posted at What Next, saying, "Life is a series of choices, what you decide today will affect your choices in the future so choose wisely. Because I have a larger goal of early retirement buying an expensive car now will delay that goal and I don't want that."

yourlifeforless presents Buy Current Technology, Not State of the Art posted at yourlifeforless, saying, "How to save money by analyzing your needs and only buying a product that fits those needs"

Dr. Dean presents Save on Gas: At The Expense Of Our Marriage? posted at Dr. Dean's TheMillionaireNurse.com Blog, saying, "A Mars and Venus twist on the "improving your gas mileage" article."

Jason P. presents Hosting a Party – Save Time and Money posted at One Money Design, saying, "Before you go into a panic attack, recognize that there are some simple but effective ways to save some time and money on planning the perfect party."

Consumer Grocery presents More Couponing Tips from Mrs. C! posted at Consumer Grocery Advantage, saying, "Small savings can add up – even those 25 cent coupons you print off from consumergrocery.com make a difference – especially if your store doubles coupons!"

Retiring

CultOfMoney presents The best time to plant a tree posted at CultOfMoney, saying, "There is a Chinese proverb that states, “The best time to plant a tree was twenty years ago…” I’ve always liked this part of the proverb. To me, it says that sometimes, you really just need to shut up and deal with the circumstances at hand, and sometimes, regardless of what you want or how much you complain, you’re just shit outta luck. However, this proverb can give us a lot to learn from."

Taxes

Bill Smith presents What is the Federal Fresh Start Program? posted at 2012 Taxes - Free Tax Filing Options, saying, "Here are the relief programs offered under the original and the new Federal Fresh Start Program."

That concludes this edition. Submit your blog article to the next edition of The Wealth Builder Carnival using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Technorati tags: the wealth builder carnival, blog carnival.  

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

This is not financial, earning, insuring, investing, living, retiring, saving, tax, or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

Filed an Extension to File

I won't be ready to file our 2011 tax return on April 17, 2012.  So I mailed in form 4868 for an extension to file on Saturday.  Form 4868 extends the tax filing date to October 15, 2012.  However, form 4868 does not extend the date for paying taxes owed, which are still due on April 17, 2012.   We will avoid penalties and interest since we expect a refund and therefore, have over 90% of our 2011 actual tax liability already paid by April 17, 2012.  (If we owed money,  we would have sent in the expected payment with form 4868.)

My plan is to complete our tax return by the end of April since we are getting a big 2011 tax refund .  In 2013, I will plan to complete our tax return in February since we expect a big 2012 tax refund already.

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



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

Copyright © 2012 Achievement Catalyst, LLC

Taking Advantage of Tax Day Specials

This year, I'm plan to celebrate the end of tax season, which I haven't done before for previous tax seasons. I'm going to take advantage of some of the tax day specials that various (mainly food) businesses are offering.  Here are the best I found for the April 17, 2012 tax day specials since they provide links to locations and most of the coupons: About.com and That Frugal Girl.  These sites also are updating the specials as new information becomes available.

Unfortunately, I won't be doing most of the specials on the list since the locations are not close or I don't have a Facebook account. For now,  I will try to do the Buy One Get One for one cent specials for a Big Mac or Quarter Pounder at McDonald's.

In addition, the Fox and Hound normally has $2 pint days on Tuesdays, which also happens to be Tax Day (April 17, 2012) this year.   So I will probably try to take advantage of this special also, even though it is available every Tuesday.

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

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

Copyright © 2012 Achievement Catalyst, LLC

Why I Like Costco

Great customer service is the main reason I keep our membership at Costco.   I am always amazed at the ability of the Costco associates to what's right for the customer.  Here are some of the examples I've experienced:

Post purchase breakage.  Once I purchased a large container of hummus for a party.  While transferring the container to my truck, I dropped it and splattered the contents on the parking lot.  So I went back in to purchase another product.  As I was checking out, the self service person noticed that I was buying the same product again.  I explained that I had dropped the previous purchase. She immediately told me that Costco would replace my broken product at no charge.

Return policy.  For most products, Costco will refund a return forever.  This policy no longer applies to electronics such as TVs, DVDs, and computers.  I've returned items after as much as four years, without any issue even when there wasn't a receipt.  The Costco representative will look up the purchase on their system and refund the price.   With a receipt is even easier.

Executive membership rebate.  When I purchased the Executive Membership, I was told that Costco would pay the difference if the 2% rebate did not exceed the additional cost of the membership.  In 2011, our 2% rebate did not exceed the additional $50 cost for an Executive Membership.  When I read the rebate check, the terms noted that there was no guaranteed refund of the difference between the rebate and additional cost.   However, when I took my less than $50 rebate check to the customer service desk and mentioned the gap, the customer service rep immediately said Costco would refund the difference

While customer service is great, the prices are also very good.  I believe that I am always getting a low if not the lowest price for any item I purchase. So I will maintain our executive membership with Costco and continue shopping there.

Disclosure:  In case readers are wondering, no compensation was received for this article.   This post represents my own opinions and experiences.

For more on Reflections and Musings, check back every Saturday for a new segment.
This is not financial or shopping advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

Doing Something Different

When people find out I retired early, they often assume that I consult with my former company. They are often surprised that I don't. My response is that if I wanted to do the same work, I wouldn't have retired. Since I retired, I was interested in different jobs than the one I had been doing.  Since most of the work I do is completely unrelated to my career in R&D, I am getting paid to learn about different jobs.   Here's are the types of jobs I've worked since retiring:

Teaching.  I teach an after school program and also tutored students for college prep exams.   While I don't have the qualities of being a career teacher, I do enjoy these short term teaching and tutoring assignments.   In both cases, teaching plans are developed and provided by the franchise headquarters.   Unfortunately, the tutoring company has reduced my hours to about zero since the company wants teachers to commit more time.

Tax preparation.  Except for our time in Japan, I've always done our own tax return by hand.  I'm a bit of a tax geek, always learning about ways to minimize our tax liability and give less money to our wasteful government.  So I've been doing a seasonal tax preparation job every year since retiring.  Basically, I'm getting paid to learn about the tax law to help individuals (and me) keep more of their money.

Non profit management.  OK, being an executive director was a little closer to my pre-retirement job of being an R&D manager.  However, it was different enough to be interesting.  It also made me realize that it wasn't worth going into business for myself if I wasn't going to clear at least $250,000 a year to make up for all the headaches of running a company.

Playing golf.  This is my only volunteer job, playing golf as an aide to players that need assistance.  I didn't play much golf when I was working, since I thought it was a waste of time.  Golf still is a waste of time, but I justify the effort since I am helping someone enjoy the sport.

Someday, I may get an offer to do something similar to what I did before retiring.   I may consider doing the work for a short period.  However, for now, I'm glad I'm dong different types of jobs than what I did during my career.

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

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

Copyright © 2012 Achievement Catalyst, LLC

More Physical Maintenance Needed

In my younger days, I thought my body needed very low maintenance support.   I rarely used supplementary protective aids.   I ate what I wanted and took very few vitamins. I rarely took medication, maybe an aspirin or decongestant occasionally.

It started slowly.   At first it was just glasses to correct for nearsightedness.  Then, I converted to contact lenses in my late twenties.   The only major disruption was a dislocated shoulder from playing rugby, which required an emergency room visit.  My thirties were relatively easy.  With my forties came weight gain, sore feet and  reading glasses.  Since retiring, I have lost weight which significantly reduced the sore feet condition.  And my eyesight seems to have improved slightly :-)

However, I know more maintenance requirements will be needed in the future.  Based on my parents' experiences,  I expect to need special supports (e.g. knee brace, shoe inserts), more medications to control health metrics (e.g. cholesterol, blood sugar) and perhaps other physical aids after I pass 70.  In the meantime, I look forward to  fifteen more good years.

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

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

 Copyright © 2012 Achievement Catalyst, LLC

Probability of Market Correction is High

The much anticipated correction appears to have started.  I don't believe the recent decline will be another false start.  There are too many factors pointing towards a correction.   Here are the elements that are supporting a correction:

Earnings growth slowing.  Estimates for 2012 Q1 earnings have been revised downward already, reflecting the slowing of earnings growth and economic growth.  I expect a high proportion of earnings to disappoint.

EU debt issues.  The sovereign debt issues of the Euro zone won't disappear from the debt restructuring that has been or will be done.  Eventually, the Euro zone will have to own up to the solving the debt issues for Greece, Portugal, Spain and Italy and maintaining the Euro monetary union to be mutually exclusive options.

Technical market conditions.  Since October 2011, there hasn't been a weekly pullback of even 1%.  In addition, the market has been rising on low trading volumes.

Today, I plan to start selling the positions we hold in our investment and retirement savings accounts, especially if I have purchased the stock since October 2011.   After a 20% decline, I plan invest 10% of our retirement account back into stocks. will reinvest 15% for the next 10% drop.  Then I will reinvest 20% for each succeeding 10% drop.  So if the market drops 40%, we will be 45% back into the market.  Past 40%, I probably don't have the courage to continue to reinvest.

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

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

Copyright © 2012 Achievement Catalyst, LLC

Links to Carnivals from April 3 - 9, 2012

Here are the links to the Carnivals in which My Wealth Builder participated from April 3 - April 9, 2012:

Tax Carnival #101

The Wealth Builder Carnival #71

Festival of Frugality #331

The Carnival of Financial Camaraderie #28

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

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

Copyright © 2012 Achievement Catalyst, LLC

The Wealth Builder Carnival #72

Welcome to the seventy-second edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic. For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized into seven categories: Earning, Insuring and Protecting, Investing, Living Frugally, Retiring, Saving and Taxes. Unfortunately, Blog Carnival was having some technical difficulties in the last week, which has significantly limited the number of submissions.

Living Frugally

Super Saver presents Be Prepared for Bad Financial Times posted at My Wealth Builder, saying, "The Great Recession has taught me a tough lesson. It's not how well I do during the good times; it's how well I survive during the bad times."

Taxes

Scott Skyles presents Mortgage Interest Deduction, Limit & Phase Out 2012 posted at Mortgage 1A, saying, "The mortgage interest tax deduction provides homeowners the ability to deduct the interest they paid on their mortgage(s) from their taxable income they earned for the tax year in question. Your primary residence isn’t the only mortgage interest deduction you can take advantage of."
That concludes this edition. Submit your blog article to the next edition of The Wealth Builder Carnival using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Technorati tags: the wealth builder carnival, blog carnival.  

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

This is not financial, earning, insuring, investing, living, retiring, saving, tax, or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

How I Got the Most from my Performance Appraisals

Almost everyone I know dreads a performance appraisal, whether giving or getting one.  Managers dread the administrative process of  As a retired manager, I've given a 20 to 30 performance appraisals.  I've also received over 30 performance appraisals during my working years. 

As an astute supervisor once told me, there are only two or three performance appraisals that I found useful.  Here they are:

For promotion recommendation.  In my company, an up to date performance appraisal (PA) is needed to make a promotion recommendation.   Doing a PA for a promotion recommendation is very straightforward to do.   The PA will focus on the positive business results, great contributions and strengths.  It's basically a testimonial.

To document career goals.  A PA is a excellent opportunity to tell my supervisor and the company about my personal career goals and get management's reaction.  To me, a lot of improvement plan recommendations means I'm not on track.   A plan of preparatory next assignments means I'm on track.

To request approval of my personal training plan.   I always found PAs a great time to tell my supervisor the training courses and associated costs for the upcoming year.  In my experience, my training plan of one to two courses involving no more that 10 working days were always approved.

PA elements that I didn't find useful:  strengths, weaknesses and improvement plans.   In general, I didn't get much benefit for reviewing these areas on a annual basis.

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



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

Copyright © 2012 Achievement Catalyst, LLC

Getting A Big 2011 Tax Refund

I roughed out our 2011 Federal and State tax return and, as expected, we'll be getting a really big tax refund.  A big refund is not the norm for us.  Usually, we get a small refund (e.g. about $100) or owe a few hundred dollars. This year we'll be getting significantly larger refund.

The reason for the big tax refund is the over withholding for the exercise of stock options I retained when I retired.   My company's policy is to withhold 25% federal taxes and 5% state taxes for stock option exercises, which is way higher than my tax bracket since I'm retired.  (For reference, the withholding would be accurate if I was still working at my old job.)   I've requested for the withholding to be reduced and be more accurate, but my company's policy prevents the change from being made.  So it appears that I will be getting large refunds for the next few years as I exercise stock options, provided there isn't a big market crash that makes the stock options worthless.

Since I currently expect to have a large tax refund for 2012, my goal will to get our 2012 tax return filed in February next year, which would be the earliest I've ever filed a tax return.

For more on New Beginnings, check back every Sunday for a new segment.
This is not financial or tax advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

Going to Have A Lot of Free Time

At the end of April, I'm going to have a lot of free time as several jobs end or scale back.  First my seasonal financial services job ends on April 17.   Second, the transition of my temporary full time job is complete and my employment will end on April 30.  Finally, after after being called in only once since May 2011, I've been demoted from college prep exams (high demand) to subjects (extremely low demand).

My one remaining part time job only requires about two hours a week.  In addition, managing and writing for My Wealth Builder takes about another five hours a week.  At this point, I don't plan to take on any new part time jobs.  So I am going to have a lot of free time in May and the rest of 2012.

Here's what I plan to do:

Home projects.  I put several home projects on hold for the multiple part time jobs in 2010 and the temporary full time job in 2011.  I am going to start up on those projects again: outdoor masonry repairs, indoor grout repair, garage organization, and other general house maintenance.  In addition, we will likely need to replace our driveway this year which will require estimates and choosing a contractor.

Lunch with our daughter.  I'd like to start having lunch at with our daughter a couple times a month again.   Our daughter still thinks it's cool to have dad visit for lunch.  It won't be long before she won't want me to attend lunch so I will take advantage of the opportunity now.

Investments.  I haven't been very engaged in our investments for the past two years.  I plan to take a few courses and begin actively managing our investments again.  I've already identified a couple of courses to take that are offered by one of my brokers.

Hobbies and entertainment.  I've already starting some coin collecting activities with our daughter, which she enjoys.  I will also start using our pool and foosball tables on a more regular basis.   Also, I plan to use my free activities card for our local parks more often to do canoeing, pony rides, bike riding and children's activities.

I look forward to having lots of free time this summer to work on the things that I choose :-)

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


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

Copyright © 2012 Achievement Catalyst, LLC

Seniors Still Paying on Student Loans

 Over 60 and still paying student loans reports that $36 billion, or 4.2%, of student loans are owed by people 60 and older.  Another 11.3% of the student loan debt is owed by people 50-59.  The article does not share the exact causes of  people still having student loans at these ages.  The potential reasons include not paying enough on loans, going back to school later, or co-signing a child's or grandchild's student loan.

When I graduated from college over thirty years ago, loans were a great way to help pay for a college eduction.  I doubt many seniors were paying off student debt.  For my spouse and me, we were able to pay off our student loans in 10 years or less, as many of our peers did, with little difficult.  

Nowadays, the data show student loans may be more of a detriment than a help.

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


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

Copyright © 2012 Achievement Catalyst, LLC

Earn Large, Live Small

Here's my simple strategy to building wealth quickly: maximize and grow earnings; live at least 20% below those earnings.  Building wealth is all about earning large and living small.   To me, many people make the mistake of doing the opposite: earning small and living large.   In the spirit of having a provocative discussion, I'll share some hypothetical numbers, which I usually don't do.

Earning Large
To me, earning large is a minimum of $80,000 per year and preferably over $100,000 for a household.  These numbers are well within reach of many households, if they choose to strive to achieve them.   Here are some of the opportunities: 

Education.  Get a degree in a field that leads to a high paying profession.  For example, starting salaries for engineers at top corporations are about $70,000.   Degrees in chemistry have starting salaries around $50,000 with large companies.   Avoid interesting degrees that lead to low paying or no jobs.

Dual income.  $80,000 a year is a $40/hour paying job for one person.  However, a $40,000 a year job is a $20/hour paying job for one person.  Two times $40,000 is $80,000.   The day after my spouse and I got married, we became an "earning large" household due to combined incomes.

Longer hours.  Working overtime has been an option during the economic recovery.  I've seen people boost their income 20-30% at time and half and double time rates.

Multiple jobs.  A simple option is to work multiple jobs.  At minimum wage, working 80 hours a week is about $30,000 per year.   For reference, when I was a manager, I worked 60 to 80 hours a week and in my case, working OT meant working on my "own time."  :-)

Work for a large corporation.  Having worked for a large corporation, I know employees are paid well to live with the corporate rules and bureaucracy.  In my company, new hire college graduates are being paid a minimum of $40,000/year and all new hires are probably averaging $60,000 a year or more.

Of course, all these options are about making a "harder choice," which some, perhaps many, people are not willing to make.

Living Small
To me, living small means putting $10,000 to $20,000 in savings every year in 401Ks, IRAs and taxable savings accounts.  If a household is earning $80,000 to $100,000, saving $10,000 to $20,000 should be possible.  Here are some approaches:

Pay oneself first.   The first payment from every paycheck should go to savings. Once this obligation is met, the rest can be spent.

Avoid debt.   With the exception of a home mortgage and an education that leads to a high paying job, debt should be avoided. 

Focus on what's necessary.  I need basic food, transportation, clothing and shelter.   Everything else is an upgrade or discretionary: TVs, cable/satellite, cell phone, many electronics,  newspapers, Internet and entertainment.  One doesn't need to eliminate all upgraded or discretionary items.  For example, we do have the Internet, a prepaid cell phone and have a DVD player. 

Living small is not about being deprived.  Again, it's about making choices. One can't have everything when just starting to build wealth.

To me, earning large and living small can be done by a significant majority of Americans who are willing to make the extra effort and the additional sacrifices necessary to build wealth.

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

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

Copyright © 2012 Achievement Catalyst, LLC

Links to Carnivals from March 26 - April 2, 2012

Here are the links to the Carnivals in which My Wealth Builder participated from March 26 - April 2, 2012:

Tax Carnival #100

Carnival of Financial Planning #230

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

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

Copyright © 2012 Achievement Catalyst, LLC

The Wealth Builder Carnival #71

Welcome to the seventy-first edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building and did not include submissions that were off topic. For reading convenience, the posts are listed with a brief summary or comment by the submitter and organized into seven categories: Earning, Insuring and Protecting, Investing, Living Frugally, Retiring, Saving and Taxes. Unfortunately, Blog Carnival was having some technical difficulties in the past two weeks, which has limited the number of submissions.

Earning

David Leonhardt presents How To Make A Killing As A Bar Server posted at Barwhiz Blog, saying, "The golden rules for servers to greatly increase their income, whether in a bar or in a restaurant ... or in any other role that requires serving others."

Jeremy Biberdorf presents Starting A Side Business posted at Modest Money, saying, "Have you ever considered starting a side business to earn some extra money. Read Jeremy's story of what led him to start his own side business."

Super Saver presents Three Signs of Being on the Fast Track posted at My Wealth Builder, saying, "Career advancement is one of the best ways to increase income. Being on the fast track is a way to increase income even faster. Here are some of the signs I've noticed when people are on the fast track."

Insuring and Protecting

Jimmy Jones presents Why You Need Short Term Disability Insurance Plans? posted at Buy Short Term Disability Insurance, saying, "Short term disability insurance can be very supplement your income when you can't work. Find out why you will need this."

John presents Anyone Have a Clue When it Comes to Blue Insurance? posted at Wallet Blog, saying, "If you only knew who's insuring you. Blue insurance could have YOU singing the blues."

Investing

Dividends4Life presents 7 Dividend Stocks Sporting A Five-Star Rating posted at Dividend Growth Stocks, saying, "Performance and sustainability - that's what investors in Dividend Growth Stocks are looking for. It's very easy to find stocks with a yields greater than 10%, but how many of those will be able to sustain or grow their dividend over 10, 5 or even 3 years?"

Living Frugally

Dr. Dean presents 24 Stupid Things People Do With Their Money! posted at Dr. Dean's TheMillionaireNurse.com Blog, saying, "Have you ever done anything stupid that cost you money? Check out my list of stupid things not to do and see how well you're doing."

Jason P. presents Frugal Kitchen Tips: Frugal Kitchen Appliances posted at One Money Design, saying, "Frugal kitchen tips aren't just about what’s for dinner. There’s another big expense in the kitchen: small appliances! Follow these tips to save more money!"

Retiring

Darrow Kirkpatrick presents Understanding the Two Sides of the Retirement Equation posted at CanIRetireYet.com, saying, "The retirement equation governs the essential relationships, now and in the future, between all the variables that determine how long your money will last. Fortunes are made by calculating, prognosticating about, and manipulating this formula. And fortunes will be lost by those who get it wrong…But, despite all the words uttered and pixels consumed on behalf of this equation, it actually boils down to a simple relationship that anybody can understand."

That concludes this edition. Submit your blog article to the next edition of The Wealth Builder Carnival using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Technorati tags: the wealth builder carnival, blog carnival.  

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

This is not financial, earning, insuring, investing, living, retiring, saving, tax, or wealth building advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC

Wealth Builder Ratios - Q1 2012 Update

Here is our Q1 2012 Wealth Builder Ratios update. During the first quarter of 2012, the Dow, Nasdaq and S&P500 indices were up at 7.5%, 18.6% and 12.0% respectively. Our investment portfolio returns were 0.4 % due to being mainly in cash during Q4 and a meager 0.7% return for my company stock.

For more details on the relevance of these ratios, please see this How Much Is Needed To Be Wealthy - The NUMBER. 

Ratio and Target	Q4 2011	Q1 2012	Comments
Investment Income to Salary Target= 0.8 2007= 3.41 2008= -5.47 2009= -1.38 2010= 1.29 2011= 0.5	0.50	0.07	2012 has started out postive but much lower than index returns due to being mainly in cash.  I have sold all the company stock in our IRA, keeping only the low basis shares in my company retirement for a future NUA execution. As my company stock (hopefully) advances, we plan to continue execute the remaining stock options I own.
Savings to Salary Target>20 2007=23 2008=16.7 2009=15.3 2010=16.6 2011=17.1	17.1	17.2	I sold most of our stock investments in June 2011, and kept my company stock and stock options. We avoided most of the volatility in the fourth quarter but missed the gains through the end of the first quarter of 2012.  So the change mainly reflects the small positive change in my company stock.
Debt to Salary Target=0 2007=1.51 2008=1.46 2009=0 2010=0 2011=0	0	0	We said bye-bye to our mortgage on May 20, 2009. Eliminating a mortgage payment has reduced our expenses by 24%.

My financial goals for 2012 are:

1. Continue to maintain an Investment Income to Salary ratio > 0.8. (off track)

2. Maintain a Savings to Salary ratio of 20. (off track)

3. Maintain Debt to Salary Ratio at 0. (met final goal of 0)

(For reference, Salary refers to gross salary just prior to early retirement in October, 2007.)

Both #1 and #2 were directly correlated with how well our stock, bond, and CD investments returns. With the positive performance of my company stock and the high proportion of cash, our portfolio increased less than the indices in Q1.

It has been very challenging retiring at the beginning of a bear market. Our short term expenses (next 3-5 years) are invested in CDs, bonds and money markets. So we can wait for the stock market to continue an upward trend. I continue to be concerned about volatility of our investment portfolio, but believe there is more downside than upside potential going forward due to EU sovereign debt crisis and continued deleveraging.

I continue to have the same financial goals for 2012. At this point, I am pessimistic about the economy and the stock market.

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 © 2012 Achievement Catalyst, LLC

A New Green Energy Initiative

In a much anticipated announcement, President Obama shared the four major points of the his green energy initiative today, also know as the Clean Renewable American Power act.  Mr. Obama heralded the bill as a giant step forward in "freeing the United States from its dependency on Middle East oil" and  "providing middle class Americans with sustainable energy for many generations." 

President Obama described the specifics as :

Natural.

Completely sustainable.

Addresses greenhouse gas emissions.

Middle class focused.

The technology involves harnessing methane gas production from livestock such as cows, sheep and goats.  Livestock currently accounts for 18% of greenhouse gas emissions, more than all the planes, trains and automobiles in the world.  So using this source of natural gas would serve several purposes.

The technology is based on a gas capturing and filtration dome that can be placed over individual animals or entire building.  The methane gas is then collected and separated from the oxygen and nitrogen through a series of distillations plates under in subfreezing temperatures.

President Obama dismissed the critics who claimed that this project would likely turn out to be another disaster like Solyndra.  Mr. Obama scolded Republicans, "Let me be perfectly clear, Americans have been asking for Clean Renewable American Power (CRAP) and I'm going to give it to them.  It's time for the Republicans to stop being the party of "no" and vote for CRAP.   It is my goal to make sure the Middle Class gets more CRAP than in the previous three administrations."

One the CRAP act passes, it is expected that President Obama will appoint Lawrence Summers as the new CRAP Czar.   President Obama praised Mr. Summers by saying, "Given that Larry has already shown his effectiveness on White House Economic Council, it is fitting that he become the first Czar of CRAP."

Mr. Obama concluded the press conference by wishing everyone a Happy April Fools' Day!

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

This is not financial, energy or policy advice. Please consult a professional advisor.

Copyright © 2012 Achievement Catalyst, LLC