Tags Posts tagged with "2008 Goals"

2008 Goals

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Now that I’ve finally reached my goal of $10k in savings (two months later than I’d hoped), I’m going to ease back on the throttle a bit and concentrate more on getting my checking account balance to a level that I’m a lot more comfortable with.

For the past few months, I’ve been transferring roughly $400 in to savings each week!

That’s freakin’ crazy.

Sure, I’ve seen my savings balance grow at an impressive clip but, at the same time, I’ve been cutting it real close in my checking account.

Too close for comfort, actually.

And, now… I want to get comfy.

So, with the money that I’m no longer throwing towards savings:

  1. I’m going to pay my latest auto insurance premium in full.
  2. I’m going to erase the remaining credit card balance (around $750) on the baby furniture.
  3. I’m going to be financially irresponsible and feed my addiction one last time before the smurfling is born.
  4. I’m going to pad my checking account balance to $5000.

That last one will likely take a few months.

And then, of course, when $5000 is the new $0, I’ll resume “feeding the pig” at my crazy high rate.

So I’m not *really* backing out, just, well, re-grouping, I guess?

And with the terrible rate that I’m earning in savings currently, well, this seemed like the perfect time to make this move.

Reviewing My ProgressWell, 2008 is all but over so how’d you do?

I did pretty well on my goals for 2008. I mean, I certainly can’t complain.

In order of completion, I managed to increase my 401k contributions to 15% of my income, I eliminated all of my credit card debt, I paid down enough principle on my mortgage to have PMI removed (though it never actually happened), and I paid off all of my auto loans.

That’s a pretty decent set of achievements and I’m proud of every single one of them!

But there were a couple more goals on my list…

One, that I considered lofty, was to have $10k in savings.

Here, on the last day of the year, I’m finding myself in a bit of a grey area. I don’t feel that I accomplished the goal but by a technicality (my paycheck was deposited today instead of tomorrow because of the holiday), I actually have $10k at my disposal.

Just saying that blows my mind but, honestly, it doesn’t feel real.

And it isn’t all in my savings account right this minute, but it could be, so that goal was pseudo accomplished as well.

The final goal was to increase my passive income. That was a wishy-washy goal from the get-go and though my “side income” decreased by over $13k this past year, I managed to increase my 100% passive income… by just $63 over the entire year.

Hey, it’s better than nothing, right? It’s not like I “worked” for it…

So, with that, I can’t say that I accomplished all of my goals, but I think I took care of the big ones.

Hopefully 2009 goes even better — though my goals for the coming year are far less specific.

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On Christmas Eve I received a check for $225 from one of my clients.

It was a welcome check, being Christmas Eve and all, but at the same time, it induced a feeling that, well, let’s just say that it didn’t exactly put me in a “holiday” spirit.

See, the $225 was a payment for an invoice sent at the end of September — the check even said so.

What’s the problem?

The check that I received on Christmas Eve should have been received back in October.

Further, I’ve sent this client an invoice at the end of October for a few hundred dollars. Again, in November too for an additional few hundred. We’re scheduled to submit another invoice next week.

Plain and simple, I was expecting a MUCH larger check.

All together, what they owe is enough for me to be able to reach my 2008 savings goal.

Given the fact that they are perpetually 90 days behind, well, I don’t see it happening.

That’s upsetting.

Most baffling is that they’re a Fortune 500 company. You’d think they’d have their act together, you know, being a grossly successful international company but you’d think wrong.

Qwest Logo -- The company provides a great product, no question, they just can't seem to pay their own bills promptly...I’ll out them, it’s Qwest Communications.

Ever heard of them?

Yep, I’m sure some reading this right now have their internet through Qwest. Or their television cable. Qwest also delivers telephone service to a pretty large chunk of the United States — mostly out west.

And that got me thinking, what would happen if I were perpetually 90 days late paying my internet, cable, or phone bill?

I’d bet I wouldn’t be publishing this post right now…

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Confusion and FrustrationI’ve already stated that I’m throwing in the towel on the $10k in savings by the end of the year. At the time, it was still remotely possible to achieve, but now, a few weeks later, it’s not a goal that I’m confident that I can accomplish.

And I’m not sure if anyone has noticed that I’ve mysteriously misplaced a couple of my original goals…

One was to run a marathon in a competitive fashion and the other was to increase my passive income.

The first isn’t happening. No way, no how. I’ve got the shoes. I’ve got the time. But I don’t have the stamina. I’ve given it the “old college try” a few times this summer — running 6 or 7 consecutive days in a row — but an eventual bout of asthma always put a stop to it before I really got into a good routine.

It’s just not there anymore, and this late in the game, I’m not sure I could even get up to speed to run that far in time for the NYC Marathon in November (sponsored by ING — how appropriate!). Maybe next year.

The other goal was to increase my passive income considerably. I stated that I wanted to triple it in 2008. Yikes! What was I thinking?

So far, I have definitely increased my passive income over years past, but not by a whole lot. Certainly not triple. From day one, it was an unrealistic goal.

That’s okay. As long as I’m working less and still making a few bucks as I sleep, it’s all good. And I think the entire idea stemmed from the fact that I knew I wanted to work less — I just didn’t want to earn less too. So, looking at it that way, I half-way accomplished the goal since I am definitely working less. Kinda? Sorta?

But the new goal I’m adding stems from a comment made by Coupon Artist earlier this month. She inquired as to why I’d increase my 401k contributions more (I’ve already hit the maximum match) when I could be contributing to an IRA instead.

I admitted to my ignorance on the subject, but having read up on it a bit over the past few days, rather than strive for the $10k in savings this year, I’m going to instead open a Roth IRA with Vanguard and contribute the full $5k before the end of the year (though I’m aware I could wait all the way up until April 15, 2009).

I still can’t really grasp the advantages of a Roth IRA, but in the long-term picture, having some money there certainly can’t hurt.

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Q*Bert was a terrible game.  For some reason though, my mother thought it was the funniest game out there…I’ve just updated my side bar progress for my
2008 goals
and so far, I’m well ahead of pace.

My financial goals added up to $30846 this year. To date, I’m right around $21k of the way there or just under 70%.

We’re just over the half way point of the year, so things should be looking great, right?

Well…

Starting at the top, I have finally conquered the credit card monster. I’ll never again approach my all time high of around $28k. I’m done with that forever and by “that”, I mean carrying a high interest balance.

Since paying it off in full, I’ve run up around over $1k every now and then, only to pay it off in full before the statement is issued.

Moving down to my savings goal, I dunno, lately I’m just having a hard time imagining this goal coming to fruition in the next 5 months. Simple math tells me that it can be done (at the rate of $2k per month).

That number seems crazy-high to me, but it’s right around the amount that I’ve been throwing towards debt for years now. With the debt gone (just around the corner), it shouldn’t be a problem but for some reason, I just can’t imagine throwing that kind of money towards savings on a monthly basis…

Ahhh, the PMI

While I’ve reached the goal I set back in December, I can’t yet claim that I’ve eliminated PMI. It’s been an on-going process and I’m still sending additional money towards my mortgage to make it finally happen. (please?) So, while this goal may appear to have been completed, it continues to suck up a large portion of my monthly budget which would otherwise go elsewhere…

The last goal is my auto loan — listed last because it has *always* been the lowest priority.

That’s about to change though as I’ve already initiated a payment plan that will see it drop a minimum of $900 per month starting this week and being in my “Red Zone“, it will be done and over with by mid-September and possibly even sooner.

In the end, three out of four isn’t bad. I’ve mastered debt repayment already, but getting the hang of saving is still a work in progress…

Maybe next year…

(I know, I know… It’s only July…)

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Red Zone OffenseSometimes I find myself going into a sort of “kill mode” when it comes to debt.

You know, when you stray from the steady payment plan and just recklessly throw every last penny at one specific balance…

Know what I’m talking about?

For me, that happens every time a balance falls below $4k. And when that happens, well, it’s game time.

I have quite a bit of experience at this sort of thing. Not something to be proud of, really… I mean, who wants to brag about having carried many, many, many $4k+ balances in recent years? (Me.)

But the one thing that it has is exposed is a debt repayment pattern of mine:

  • An old MBNA credit card’s balance fell to $3563 back in May of 2006 and two months later, it was gone.
  • My Bank of America credit card’s balance fell to $3267 in December of 2006. By January 2007, it was gone.
  • More recently, my Citi credit card balance was $4500 in December 2007. I wiped it out in January 2008. Wow.
  • And my last remaining credit card debt, the Chase account… Well, in February it had a balance of $3518. But by the April statement, it was holding steady at $0.

See what I mean?

But the last few months have been sort of ho-hum for me on the debt re-payment front. Things are moving, yes, but they’re not very exciting…

I thought I was making great strides in the past few weeks in my quest to eliminate PMI by knocking off an extra $6000 off of my mortgage balance over the year, only to find out that I need to knock off another $2500. And even that might not do it. Not happy about it.

But in the meantime, my auto loan balance has snuck through the $4k’s and now sits with a balance of $3986.

You know what that means?

Time for the red zone offense to take the field.

Yep, two months or less until Toyota mails me the title.

This is my red zone.

(Yeah, yeah… I know this is the wrong time of year to make football references… Go Bears!)

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United States Federal Trade CommissionAccording to the Federal Trade Commission, Private Mortgage Insurance (PMI) must be terminated automatically by the mortgage company when the borrower reaches 22 percent equity in the home based on the original property value — most often, the purchase price.

In my instance, the purchase price of my home was $141k. A bargain, really. Even back in 2002.

As of this morning, the remaining balance is $112,535.99. That works out to 20.187% equity based on the original property value.

To reach the 22% mark, I need to pay down an additional $2,555.99 in principle — preferably before October of this year when the mortgage company re-evaluates my escrow account (where the PMI payment is drawn from) and re-calculates my monthly mortgage payment for the following year.

If this is the first post you’ve read of mine on the subject of PMI cancellation, you may want to take a look at this earlier post where I was, in my opinion, wrongfully denied cancellation by Countrywide.

I plan to do this as soon as possible and am currently evaluating various promotional credit card offers I’ve received in the mail to be able to make the additional payment as soon at this week.

The most attractive offer so far is from Chase Bank. It’s 0% until April of 2009 with a 3% transaction fee capped at $199. In this scenario, I’d write a check to myself for $2555 and be charged with a $76.65 transaction fee (3 percent).

My new balance with Chase would be $2631.65 at 0% for 8 months. That works out to around a minimum of $330 per month to pay it off before any finance charges come along. That wouldn’t be a problem.

If this plan were successful, it would prevent paying $85.15 in PMI charges for at least 4 months (possibly more), a $130 appraisal fee, and loads of difficult to calculate interest.

So, for a cost of $76.65, I could save an absolute minimum of $470.60.

Sounds like a good plan.

Before any of this happens though, I first need to get in contact with Countrywide and ensure that reaching the 22% mark will indeed automatically cancel PMI without any additional effort (or $130 appraisals) from me.

My interpretation of the law (and I read it like 50 times over) indicates that automatic cancellation at 22% has nothing to do with an increase or decrease in the value of the home, only with how much the mortgage is paid down. I have my doubts, but we’ll see…

(In all actuality, my wife will probably make the confrontational phone call. She’s *way* better at that sort of thing than I am. That’s why I married her!)

Worst case, I knock off a lot more principle, save a bunch of money, file a complaint with the FTC, and then see where that takes me…

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Countrywide Home LoansI knew it.

I knew it!

I knew that canceling PMI wasn’t going to be easy. I just knew it.

And I’m pissed.

Here’s the letter I received from Countrywide’s Mortgage Insurance Department yesterday:

IMPORTANT MESSAGE ABOUT YOUR LOAN

Thank you for your recent inquiry about deleting the mortgage insurance on your Countrywide home loan. Your loan must meet current mortgage insurance cancellation requirements for this to occur. Please allow us to explain what this involves.

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WHAT THIS MEANS

The current value of your property must be equal to or greater than the original value of your property at the time the loan closed for the PMI to be deleted. The original value of your property means the lesser of the sales price or the appraised value at the closing of a purchase loan, and the appraised value at the closing of a refinance loan. A Certificate of Value (COV) is required to determine if the current value of your property is sufficient to meet this requirement. Your noteholder requires Countrywide Home Loans to select your COV provider. You will be responsible for the cost of the COV. Before you send a check or call to provide credit card information for you COV, we would suggest that you try to verify that the value of your property meet the above mentioned criteria.

———————————-

WHAT YOU NEED TO DO

If you choose to continue with the COV ordering process, simply complete the form at the bottom of this letter and return it with a check made payable to Landsafe Appraisal Services for $130.00. You must reference your loan number and write “COV Fee” on the check. Please do not include the COV fee along with your regular monthly payment. It must be sent separately.

Landsafe w ill [sic] contract a local Broker or Realtor to perform the COV, which will include an interior inspection and photographs. The Broker or Realtor should identify himself or herself and indicate that he or she was contracted by Landsafe. If he or she fails to do so, please ask. Our department will then review the COV and if it is determined that it adequately supports at least the original value of the property, your request will be approved. The insurance will be cancelled and your payment adjusted accordingly.

———————————-

IMPORTANT INFORMATION

Because of your timely payment record, we are able to consider your request; however, please keep in mind that any late payment may prevent cancellation.

If you do not take action within 60 days, please contact us at (800) 669-6607 to confirm your continued eligibility.

We look forward to receiving you COV soon so that we can take care of this matter for you.

Requirements are subject to change.

This letter supersedes any previous information that may have been provided to you.

So, basically, they want me to pay them $130 even though I’ve met the criteria required to cancel PMI. I get it.

“This letter supersedes any previous information that may have been provided to you.”

Yep, it must.

I understand that the housing market is down and that mortgage companies like Countrywide are struggling but it was pretty clear (even on Countrywide’s website) that PMI cancellation could be requested at the 20% mark based entirely on the original value of the home. I’m past that mark.

While $130 really isn’t that much — my wife says it’s a great deal — the idea of paying them more to tell me that my house is worth more than it was 6 years ago doesn’t sit well with me.

Neither does taking time off of work to have a realtor come over and tour my house with a camera. The Fair Plan insurance inspections I’ve been subjected to are more than enough… Yeah, maybe I have privacy issues, but it’s really not cool to be forced to let strangers (essentially un-invited) poke their heads into your closets. And then demand money.

Heading over to the Federal Trade Commission’s website, on the subject of Private Mortgage Insurance they state:

For home mortgages signed on or after July 29, 1999, your PMI must – with certain exceptions – be terminated automatically when you reach 22 percent equity in your home based on the original property value, if your mortgage payments are current. Your PMI also can be canceled, when you request – with certain exceptions – when you reach 20 percent equity in your home based on the original property value, if your mortgage payments are current.

One exception is if your loan is “high-risk.” Another is if you have not been current on your payments within the year prior to the time for termination or cancellation. A third is if you have other liens on your property. For these loans, your PMI may continue. Ask your lender or mortgage servicer (a company that collects your payments) for more information about these requirements.

None of those exceptions apply to my loan. Not one.

My mortgage was signed after July 29, 1999. It’s not high risk, it’s current, and there are no liens on my property. No re-fi’s, no HELOC’s… Nothing…

Perhaps I should file a complaint with the FTC? That would probably be an even bigger hassle. You’d think that what the FTC says would “supersede” anything Countrywide says about the matter… You’d think…

But now I’m wondering if Countrywide will drop PMI without question at the 22% mark — where it’s supposed to drop automatically. While I’d prefer not to send the additional funds towards the mortgage right now, that mark is just around $2500 away. Do-able.

But if, at the 22% mark, they still come back with this exact same form letter, well, I guess I’m not sure what I’ll do then, but filing a complaint with the FTC will definitely look more attractive.

Can You Dig It?

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