Frank the Financially Savvy Atheist (The F.S.A.)

Net Worth Update for the end of April 2008 - Plus plans for our stimulus check

2008-05-01T15:49:00.000-04:00

While last month I felt that we were firing on all cylinders, this month was comparatively weaker, but still a good one. The beginning of the month is always a nice time now, because that's when our interest payments are made. We get interest from our Emigrant Direct, interest from our high-yield checking account, interest from our the money market accounts in our Roth IRAs, and in the beginning of May and December we get interest and capitalization distributions in my 401(k). Slow and steady, slow and steady (at least for now).

On the asset side we were down 192 bps. This was because we paid off my wife's dental bill for her braces. We paid everything upfront so we could receive a substantial discount and we are going to be getting reimbursement from our dental insurance and our Flexible Spending Account. That money should be trickling in over the next few months. For our investments we had a nice bounce in my 401(k) which was up 868 bps month over month (MoM), and our Roth IRAs continued to receive their small but growing interest payments. All told the market value of our investment portfolio stands at $57K but unfortunately I am not fully vested in my 401(k) yet (for net worth purposes I only count the vested amount).

Our liabilities ticked down 198 bps as we paid off the credit card for the aforementioned braces and continued to make the necessary payments for our other debts.

At the end of the day our net worth declined 115 bps to $19,578. I expect that number to be higher next month as we should start receiving reimbursements and I don't expect our debts to increase materially.

Plans for Stimulus Check/Direct Deposit
Like many Americans we will be receiving a stimulus payment from the government. My wife and I discussed what we were going to do with the money and came up with the following allocation:
1. $300 for our kids 529 Plan ($100/each child).
2. $1000 Roth IRA contributions ($500/wife, $500/me).
3. $500 debt repayment (tackling our highest interest debt first).
4. $300 for clothes (I need work clothes and my wife also needs some more clothes as well).

As you can see, nothing too fancy for the FSA family. We will be saving most of it, and front-loading some necessary spending. Dull and dull.

A Humbling Thought

2008-04-23T10:42:00.000-04:00

A few weeks ago my wife and I were discussing our future and playing out different scenarios. We discussed various bits and pieces, what we want the kids to do when they grow up, where we would like to live, when should we do the whole Disney vacation, when do we want to try and go to China and Hong Kong. Amidst this scenario analysis we began talking about my career and my possible future salary. I have high ambitions and I think I made some sort of flippant comment like, "Imagine honey, in 10-15 years time I could be making $1,000,000 a year!"

While I was obviously excited when I said that, I stopped and thought about what that really meant.

If I was making $1.2M/year that means that I would be making $100K a month.
$100K a month means an average of $23K per week.
$23K a week means about $3K every day (including weekends).
$3K a day means $367/hour (assuming I work every day for 9 hours a day).

Now most likely if I'm making that much it would be in lumpy sums and not regularly throughout the year. Plus tack on inflation, and an uncertain tax code, yadda, yadda. That's not the point of this exercise.

After looking over these calculations I thought to myself (and voiced to my wife) why should I be in a position where I can make that much money on an annual basis? What exactly do I contribute to society to deserve this? By all measures, my wife's future career (as a teacher) will have a much more significant and positive impact on society, whereas mine, not so much. There are people that work most of their lives just to amass $1 million so they can stop working. What the hell is wrong with this world.

My wife and I discussed this some more and she pointed out that even right now I'm making more than some doctors when they first start without the crippling amount of student loan debt, so if I wanted to feel guilty I should start now! However, she instead had me focus on the positives of what that could mean. Not just for us, but for others as well. We could fund a scholarship program for teen parents so that they could afford childcare and finish school. We could donate to cancer research and help find a cure for breast cancer. We should realize how fortunate we are and concentrate on helping others. Sounds like a great idea to me.

HR Block TaXCut Basis is Free Online

2008-04-14T06:57:00.001-04:00

I was contacted via email by an advertising rep for HR Block. Usually I ignore such things, but I use HR Block online TaxCut to file my taxes and I've actually won their double your refund game. So I am passing this along to let you know that TaxCut Basic is free and they are also having some kind of vacation sweepstake to go along with it. For all those procrastinators out there. Ok, no longer a corporate tool now :P.

Net Worth Update - End of March 2008 a good month

2008-04-01T09:57:00.001-04:00

It was a good month for the FSA household. We have been firing on all cylinders recently and I hope we can keep the positive momentum going. That's not to say there hasn't been some hiccups this past month. These include my wife getting into a car accident (she's fine, no injuries to her or our middle son, just the SUV), a microwave that stopped working, and a dishwasher on the fritz. Overall this has been a good month for us though, as the hiccups seem more than manageable.

Our eldest son has really taken off with his piano playing and has recently mastered playing a piece where his hands do different things simultaneously. He's enjoying school and he has come a looong way in his social development. Makes that expensive private school that much more worthwhile, but still too expensive.

All that being said, on to the numbers.

Assets were up a whopping 308 bps this month. This was due to a refund from Harvard as my wife has decided to take a leave of absence for one semester. She's going to finish up by the end of this year. It was just too much last semester with everything else that was happening with us, so we wanted to take some times to get things in order first. We also completed the funding of our Roth IRAs for the 2007 year. A whole 15 days ahead of the deadline :). Our 401(k) was also up appreciably, but YTD we are still down 10%.

Liabilities were up 64 bps. Everything ticked down with the notable exceptions of our credit card balance which was up 1400 bps (14%). My wife got braces this month and we paid everything up front which allowed us to receive a 20% discount. Moreoever, we'll get cash-back from our credit card and we will be further reimbursed by our dental insurance. In addition to that, we will be getting reimbursed from our Flexible Spending Account.

All told, that brings our net worth to $19,806 a full 5800 bps (58%) higher than last month. Looking ahead to next month, we'll most likely be flat to up slightly. We'll be getting reimbursements from several places and spending should be down. Markets could be down though, so that might put a dent in our assets.

Here's to many more months like this one.

I've been demoted (aka what I've been up to)

2008-03-30T09:45:00.001-04:00

Oh no, I've been demoted (not at work) but something much more important. I no longer have the coveted double asterick at Madame X's blogroll! Oh woe is me. I don't blame her though, it's hard to have something as a frequent read when it's only updated once a month or so, so no hard feelings :). To that extent I wanted to provide an update for those who care about the various things going on me and my family's life.

In my most recent Net Worth Update I mentioned that I was going to be concentrating on my career in order to maximize my earnings. I've been stepping things up at work. So far this has been very positive. In addition, I've been able to get home at a decent time to make sure I can spend ample time with my wife and kids. All in all, it's been very positive around here recently, but all this means that something has to give.

As is readily apparent, the blog hasn't been updated until now, and at the same time, I have not been studying as much as I should for my CFA exam. Moreover, the house is a mess. So things aren't perfect, but they have been going well for us. Right now we are in the midst of planning our eldest son birthday party. This will be the first big party we've thrown since he's in preschool now. And on top of that, my wife has just recently gotten braces, which adds a whole new aspect of crazy busyness to our life.

So basically, our family is busy and things are going well. But there are only so many hours in the day. I will update when I can, and expect to see at the very least continued net worth updates.

The Case for (Perfect) Market Timing

2008-03-30T08:54:00.002-04:00

I decided to take a look and see what the potential difference could be between perfect market timing and just straight investing. Here's what I did.

Let's say that there are two potential investments: a stock market index, and a cash vehicle (i.e. a money market account). Now, let's posit a portfolio manager (PM) who will attempt to time the markets on a monthly basis. In other words, the PM will determine whether or not the the stock market index or the cash vehicle will outperform in the coming month. The PM will then switch back and forth between the two to try and capitalize on his/her expectations. Our cash vehicle will yield a little over 1% on an annualized basis and our stock market will be modelled by a normal distribution with an average of 0.80%. To cap it off, we will invest only $100 in each portfolio and then let it sit there.

Ok, got that? We can now take a look at 5 distinct portfolios. 1.) A portfolio solely invested in cash, 2.) a portfolio solely invested in the stock market, 3.) a PM that is a perfect market timer that will always correctly determine which investment will outperform in a given month, 4.) a PM that is only 80% accurate with his/her predictions, and 5.) a PM that is only 20% accurate with his/her predictions.

Throw together some excel magic to see what the portfolios look like after 10 years and here are the results of one scenario.

The difference here is astonishing. The perfect market timer PM has turned your $100 into almost $1240. Your 80% accurate market timing PM would have increased your investment to $583. Your stock market investment is now $356 while your cash porfolio is only $110. Your 20% accurate PM did not do so hotly, and your portfolio is now only worth $141.30.

There are a bunch of caveats and what not to the above analysis (taxes, costs, feasibility) but it shows you the magnitude of the difference between portfolios in this simple scenario/world. No wonder so many people try to time the market, it could be insanely profitable. Just a thought experiment, this is by no means an argument to go out there and try to market time yourself (or alternatively to hire an active manager to do so).

Very Young Millionaires in the Making

2008-03-06T12:59:00.002-05:00

The most recent MITM from CNN profiles a young couple, Ryan and Hope (25 and 23 respectively), and it piqued my interest because I wanted to see how my wife and I (also a young couple) stack up against them. Here is a quick table summarizing our differences.

	Ryan and Hope	Frank and Mrs. FSA
Ages	25 and 23	24 and 25
Occupations	Car salesman and Medical billing	Finance guy and Student (soon to be teacher)
Salary	$56K	>$100K
Home and Land	$125K	$200K
IRA, 401(k)	$22.5K	$50K
Mutal Funds	$3k	N/A*
529 Plan	N/A	$3.7K
CC Debt	$4.5K	$20K
Car Loans	$17.5K	$50K
Student Loans	$5.5K	$30K
Mortgage	$100K?	$185K
Leverage ratio	~ 2x	~ 2x
Net Worth	23	12K

*We don't own any mutual funds in a taxable brokerage account like this family

The main differences are clear:
1. We have a significantly larger debt load than this couple. While our leverage ratio is slightly lower than this couple (total debt / total income), their net worth is higher at 23K vs. our 12K. The article didn't mention how much their mortgage was, but did mention a mortgage payment of $500-ish a month.
2. We have three kids and spend less on entertainment.
3. We make more than they do right now.

Overall I think my wife and I are doing fine. We do have a substantial amount of debt no matter how I try to spin it. We could do a better job of sticking to our budget, and improve in other areas as well. Moreover, as the article states, kids are expensive and our three little ones a certainly a drag on time and money (but we love them!). Still, it was an insightful exercise for me at least.

Net Worth Update - End of Feb 2008 PLUS Update on Goals

2008-03-04T10:12:00.000-05:00

Another ho hum month. Nothing all that exciting to report. Assets ticked down 2 bps (darn stock market) but liabilities were also down 63 bps. We've almost completely funded our Roth IRAs for 2007, still have a few months to get the remaining $2,000 or so. All told that brings our net worth to $12,466 a 16% increase month-over-month. If only the stock market would cooperate with me then that number would be higher.

Now for an update on our goals:

Pass Level III of the CFA: I need to study more for this, I am so far behind already. Work has been crushing me in terms of time. Hopefully I can go three for three with this exam.

Lose 10 lbs by June 1st: I have made some small changes here and there, doing a semi-daily walk, parking further away so I walk more, etc. So far I am keeping my current weight, but not really losing all that much. I haven't been doing as much on the diet side to ensure my success.

Spend more time with family: this has been going decently well. I have been practicing piano with my eldest son more and my hours haven't been terrible. Weekends have generally been terrific family time and I really look forward to weekends now.

Implement GTD by end of Jan: failed! But, I did borrow GTD on CD (read by the author) and I do listen to it in the car. Moreover, I do have the book so I can use that for reference. New deadline, end of March.

Publish weekly report for work: this has been going well and it's getting my name out there. I have received positive feedback from people above me and above my boss so that makes me feel good about what I'm doing.

Other goals are going so-so to ok.

One thing I would like to add is that I am getting rid of my goal to generate $20/month of income from this blog. Why? Well, I've realized that my time could be much better spent working on my career and maximizing my income in that way first. Should have been obvious to me, but at least now I realize it. Overall this year has brought some new challenges especially on the work front and I am not sure when things will subside to a calmer level.

Belated Net Worth Update - End of Jan '08

2008-02-11T09:09:00.000-05:00

Kind of a weird update this month, a little off in terms of my schedule. Here are the numbers:
- Assets were up 163 bps as contributions to my 401(k) rolled in as scheduled. The markets have not been kind and at last blush my 401(k) was down 10% for the year. Not fun, I'm constantly talking to my wife to tell her we should keep the money in the market and not take it out and move to CDs or something.
- On the liabilities side, these were up 184 bps as we took out some more credit card debt to pay my wife's tuition. we continue to make our monthly payments on our other debts and not much else.

This brings our net worth to $10,719 or down 360 bps from last month.

Things continue to be interesting at work and time consuming.

Belated Response to comments: When the Catholic Saints Go Marching In

2008-01-23T11:25:00.000-05:00

I've been meaning to respond to several reader comments and will be doing so over the next few days. I'm going to be starting with the most recent posts and working my way back.

In my post where I wondered about the possibly polytheistic nature of Catholicism I receieved a variety of comments. To my surprise, I also received some comments from people that were very offended. Two quick examples:

Seriously, is this your post? Are you just trolling?

OK...quick primer...Saints...pray to them for intervention with God.

Mary...veneration. She is venerated, not worshipped.

Baptists...do you all hate dancing and think alcohol is the devil? We had a Baptist preacher in undergrad who would stand in the student union and declare all the sorority girls to be whores.

I cannot get over how stupid this post was. Hey, get a book. I cannot believe I am still typing. I am even more frustated that this was picked up on my blog scanner.

Seriously, if you have nothing to post, don't. This just makes you look ignorant. [Javert]

I'm a lapsed Catholic bordering on agnostic. Even though it's highly unlikely that I'm returning to the Church, I find your views to be quite ignorant and offensive. I was taught to pray to Mary and other Saints but they were never described to us as Gods and Goddesses. They were seen more as intermediaries for God. Honestly, we're not that different from Protestants. You must be from the South or some other area of the country that doesn't see many Catholics. [Anon]

Firstly, I was very clear about my ignorance with respect to Catholicism and I stated that I was confused about the many saints as well as being able to pray to Mary. I cannot honestly see why my post was considered offensive. Was it ignorant, why yes, I was pretty explicit about my ignorance. Perhaps next time I will just read a book like Javert suggested, or maybe just do a Wikipedia crawl. For what it's worth, I was trying to do something similar to my post entitled Are Mormon's Christians except this time I did not have a clear opinion on the matter.

Anywho, on to the more substantiative comments.

Timothy, who appears to be Catholic, did actually try to answer my questions as well as many other comments that stated that Catholics are polytheist and for that I am grateful to him. Hopefully you don't mind if I disagree with you Tim :).

Are saints minor deities and is Mary a goddess? Tim disagrees with the statement that saints are minor deities (and I would assume that he would disagree with the statement that Mary is a goddess), but you can only pray to saints and Mary to intercede on your behalf. They might have been human once, but the fact that they are "venerated" above others and are granted this special "power" to intercede on someone's behalf sounds to me like a minor deity. Add to this the dogma of The Immaculate Conception (see Javert, I can-sa read a books too, yes sa) where Mary is now elevated to a person born without original sin and I am hard-pressed to call her just another human being. My verdict, because only saints and Mary can be prayed to for intercession with Jesus/God and because of the dogma of Mary's immaculate conception, they are equivalent to minor deities, but I wouldn't necessarily call Mary a goddess.

On the other end of the spectrum, you had people who said yes, Catholics are polytheist, but what does it matter? Take for example Reed:

From my perspective, issues like this, all of theology really, is just lipstick on a pig. Religion is so backward and useless that debating the details is only helpful in highlighting the absurdity of it all.

This was also raised in my post about Mormonism where plonkee asked whether it really mattered if Mormon's are Christians or not. From the perspective of an atheist, it matters not. As one person put it, why bother arguing over the color of the Emperor's new clothes when he isn't even wearing clothes in the first place. For me, having very little knowledge about Catholicism, I wanted to have a better understanding of their perspective for my own edification and to come to my own conclusions. My conclusion is that while Catholics are technically monotheists, they do have polytheistic tendencies.

Admitting Defeat

2008-01-23T09:46:00.000-05:00

Back in August when markets started mean-reverting to being actually volatile I mentioned that I was going to try to take advantage of the situation in my Roth IRA. For those of you who have been keeping track, that didn't go so well and today I am admitting defeat. My Roth is down almost 5% from that time and I'm throwing in the towel. Thus ends my one attempt to outsmart the market. Thankfully it was a relatively inexpensive attempt and in the future I will keep these types of shenanigans to no more than 5-10% of my overall portfolio. C'est la vie as the French would say.

Are Catholics Polytheist?

2008-01-17T11:05:00.000-05:00

Since I grew up in a Baptist household, I don't really know that much about Catholics or Catholicism. I did attend Mass once in college (because my first gf was Catholic) but that is the extent of my knowledge of Catholicism. So my question is this, are Catholics polytheist? I know that Catholics are Christian (and for some, the one true faith) and therefore are considered monotheist, but I am confused about the large number of saints that one can pray to for different things. Indeed, I've even heard people say that Mary is a goddess in everything but name to Catholics.

What are other people's thoughts on this matter? Are Catholics monotheists with polytheistic tendencies? Are they in denial of their polytheism? Is it polytheism in disguise, or am I just mistaken? Please educate me.

Remind me to always check my bills

2008-01-15T12:21:00.001-05:00

Recently we had a minor snafu with our cable bill. I had called in to "cancel" our service and was able to get a promotional rate on for our TV package for 1 year. Since it worked so well I called again to try to get a promotional rate for our Internet. It worked again...or so I thought.
All in all I thought I was able to get a full year of cable TV and (faster) Internet for $60/month. Lo and behold our first bill came in the mail and instead of approximately $60 I see $186! Talk about a WTF moment. Anywho after a few calls with the customer service rep (not as helpful, but did credit my account) and the retention specialist (much more helpful and again credited my account!) I found out that you are not allowed to have two promotional packages on at the same time so that explained one part of my bill. They also double billed me for the Internet so that was an error on their part. Now we are back to our original package with our older slower Internet speed :(. I just called to check again to make sure everything was set and it turns out we now have a credit on our account. It's nice to know that complaining works sometimes.

Full feeds now enabled

2008-01-06T14:45:00.000-05:00

I didn't realize that my feeds were set to short until now. That has been corrected. Sorry, it was just set to the default setting.

Monte Carlo, Bitches

2008-01-04T16:41:00.000-05:00

The last time I brought up Monte Carlo simulations I stated that my 100 simulations resulted in a 65% probability that the S&P 500 would finish the year up from 1479. For what its worth, the S&P 500 finished at 1468 so obviously it ended up in one of those states where it was less than 1479 :P.

So now for fun, I wanted to see what my simplistic simulation would say for the year ahead. Instead of 100 simulations, I ran 200 simulations. Here are the results.

First, here is the standard unreadable bunches of line chart.

The chart represents the potential trajectory of the S&P 500 for the coming year.

Now here is the distribution of the yearly return of the S&P500.

Looks familiar, that's right, normal distribution baby!

Some descriptive statistics
- average: 9.2%
- median: 8%
- max: 54.8%
- min: -37.5%
- stddev: 16.25%

So I can say with zero confidence (to mutilate the statistical phrase) that the S&P has a 70% probability of finishing the year in positive territory. Not only that, but there is a 68% probability that it will end up somewhere between -7% and 25% with an average of about 8-9%.

How do you use that knowledge to invest? Beats me, this was just a fun exercise, plus by putting sufficiently wide bands around by mean (-7% to 25%) I can claim victory at the end of the year if the S&P500 ends up in that band. Man, this forecasting stuff is easy :P

A Quick Note on Welfare

2008-01-03T22:51:00.000-05:00

So JLP had a "funny" definition of welfare up on his site that equates welfare to the government stealing money from others to help other people. He found it funny, I didn't. I just wanted to point out two quick data points on welfare:

The Bad
My wife's sister, we'll call her Sandra, was a doctor in a private practice who routinely saw people from all kinds of socioeconomic backgrounds. When Sandra was first starting off she had a fair amount of student loan debt and was trying to save money to buy her first home. Sandra had a patient who was telling her that he had something on the order of 10 children or so. Sandra's first thoughts were Wow, how does this person afford this? I can hardly pay my student loans and I'm trying to save for a house.. When she asked him how he could afford all those children, the man said something along the lines of, "I have my kids with several different women, and they're all on welfare, so I don't have to pay for them!"

I don't know about you, but that pisses me off. It's everything that's wrong with the system, and validates that damn poster JLP has up right now. How dare these people suck off the teats of all these other people's hard work. Sandra relayed those feelings as well when she told my wife this story. Can't say I blame her.

The Good
The teen parents just had their first child together. Exhausted from the ordeal and coming home for the first time, they needed some necessities. Thankfully, the teen mother had the foresight to get on welfare before giving birth. In addition to that, she also signed up for WIC which provided formula for their new child. These resources proved invaluable to the teen parents and they were able to worry about one less thing as they tried their best to raise their new child together.

I am grateful for my wife and her foresight to get us on these government programs. Undoubtedly, things would have been much more difficult for us without that help. It is a humbling experience, for sure, to be "on welfare". I'm glad that we had the help, but I'm even more glad that we are no longer on any assistance program.

But those are only two vastly different data points. One highlighting the laziness and downright atrocious behaviour it can foster, and the other highlighting how helpful it can be when you didn't have much to your name.

I know welfare isn't perfect and there are certainly things that can be done to improve it, but it's a bit much to call it the government stealing from one person to give to another. What about medicare, social security? Should we get rid of all those programs as well because they are doing the same thing?

The Four Horsemen Part II

2008-01-03T00:08:00.001-05:00

Here's part two of the conversation between Richard Dawkins, Christopher Hitchens, Daniel Dennet, and Sam Harris.

Apparently, it is also available for sale on DVD and proceeds will benefit The Richard Dawkins Foundation for Reason and Science. Have a look!

Net Worth Update or the End of December 2008, Wrapping up the past year

2008-01-02T17:04:00.001-05:00

As is typical of the year-end our net worth surged skywards due to my year-end bonus. Assets were up 4.71% for the month. The kids 529 plan was up 60% due to Christmas gifts, and our 401(k) balance was up 18% for the month as well. On the liabilities side, liabilities were down 4.95% with our credit card balance down 45% as we paid off some balance transfers. The leads us to a net worth of $11,119. This was less than last year's $15,000, but that's due to the fact that our largest asset (our home) was written down substantially in between now and then.

I expect this number to be down significantly due to the fact we'll be taking out some more balance transfers that I've mentioned before in lieu of my wife taking out more student loans.

Now to recap the year in more detail.

Major asset changes Year-over-Year:
- Home Value: After writing down the value of our home, I left it flat since then. One home on our street sold for approximately 5% more than what I have it valued at but in these uncertain times, I'll leave it there for now.

- 401(k): Our 401(k) balance more than doubled this year and our calculated rate of return was 9.8%. Not too shabby considering the considerable market volatility we experienced.

- Roth IRA: We started the year with no Roth and fully funded it before April at $8,000. We end the year with $8,041. Why you ask? Well, my wife's Roth was placed in a money market fund and she has over $4,100 now. I decided to take more risk in mine and my bad did not pay off and I now have $3,900 in my Roth. Not something that I want to keep doing (lose money) but it has been a learning experience. I can be too smart for my own damn good and should have left it in the money market fund. Oh well.

- One of the biggest change on the asset (and correspondingly liabilities) side of the equation was the purchase of two new cars. We lost both of our used cars in one month and we purchased two new cars. We financed both of them and our interest rate was 4.9% and 5.5%. Not too shabby, but it's still debt on a depreciating asset.

Major liability changes:
- Added two new car loans, what more can I say.
- Our credit card debt went from as high as $45,000 (when we were doing 0% bal transfer arb) to a "mere" $15,000. More than half of which is a 3.99% APR for the life of the balance transfer we used to pay off our original car loan. This came in quite handy as we now have the option of making minimum payments on the card to concentrate on the now higher new car loan at 5.5%.

It's been quite a year for us. I hope 2008 will be just as prosperous for our family both financially and personally.

Goals for 2008

2008-01-01T12:26:00.000-05:00

After recapping my goals for 2007 it's time to take a look at where we want to be at the end of 2008.
Before I do that I need to mention that we were able to accomplish one more goal from 2007. We actually were able to double the kids 529 plan balance with Christmas contributions. We had an unexpected gift from my dead-beat dad and with it the kids balance stands at a total of almost $4,000. Thanks dead-beat dad!

Looking ahead to 2008, here's what we hope to accomplish:

Pass Level III of the CFA in June. The plan is to do what I've done for the last two exams in terms of studying.

Lose 10 lbs by June 1st. The plan is to make small but meaningful changes to my lifestyle. One change will be to drink mostly water. Another change will be to try and walk on a daily basis (when it's no longer snowing outside of course). If I was really motivated, I could do this in a month, but I'm not so I'm giving myself till June with the small changes I listed above.

Spend more time with the family throughout the year. The plan is to get to work earlier and leave earlier so that I can get home at a decent time. To try and maintain my current level of output, I will also have to do about an hour's work from home. This will allow me to get home at a time when the kids aren't just getting ready for bed. That way I can actually do something with them such as helping my eldest son practice his piano.

Implement a form of GTD by the end of January and continue with it throughout the year tweaking as necessary. There is no way I'm implementing the complete system, but I'd like to have a variant of it to help me be more organized.

Publish a weekly report for my work. Hopefully this gets my name out there to more people and "adds value".

Increase "face-time" at work. I have some ideas about how to do that.

As part of my review for the year, my manager told me he wants me to speak up more at work. I plan to start by adding commentary in smaller meetings where I feel more comfortable and then moving on to the larger meetings once I feel sufficiently comfortable. Hopefully in a month or two I'll move on to the larger meetings, but right now I'm going to stick to the smaller meetings.

Double our 401(k) balance again. This should be an automatic thing given my contribution, but I'm putting it here as well.

Contribute $5,000 to both of our Roth IRAs.

At the end of the year, we'd like to have $10,000 in our Emigrant Direct account.

We'd like the balance of the kids 529 to be about $4,800

We'd like to continue nurturing our eldest son's social interactions so that he feels more comfortable interacting with other people. So far, he's been doing a tremendous job since starting preschool.

On the budget side of things, we want to stick to our $100/month eating out budget. Looks like it's time to go back on the envelope method.

Lastly, for the blog I'd like to generate $20/month in income by the end of the year and I would realistically be able to start on that goal after June '08. I picked $20/month because that's about enough to pay one utility bill.

Whew, that seems like so many things. I'd be happy if we fullfil 60% of them come the end of 2008.

Happy New Year to all.

The Four Horsemen

2008-01-01T12:22:00.000-05:00

Richard Dawkins, Daniel Dennett, Sam Harris, and Christopher Hitchens sit down for 2 hours and have a conversation. Hilarity ensues...well, not quite, but check it out for yourself. Note, this is just part 1.

Roland Martin Breathtaking Inanity

2007-12-21T11:02:00.001-05:00

Maybe I missed most of them, but this was actually one of the few "War on Christmas" articles that I've seen this year. It's CNN's Rolan Martin who gives commentary from time to time on a variety of different subjects. He's suppose to be receiving a master's in "Christian communication" whatever the hell that is from Louisiana Baptist University. He's commented on a variety of issues, some of them revolving black men and their place in society. Usually, I don't partciularly care either way on his stuff, but his recent commentary displays his ignorance.

He starts with this ridiculous statement:

This whole push to remove Christ from the Christmas season has gotten so ridiculous that it's pathetic

Color me surprised that I haven't gotten the memo from the supreme atheist overlord on how we're going to remove Christ from Christmas. I miss it every year.

From there he rants about people not saying "Merry Christmas" and the like. Then he displays his ignorance with this:

We spend an inordinate amount of time focused on shopping and buying gifts, but really, what does any of this have to do with the birth of Jesus?

Here's a question for you Roland, what does December 25th have to do with the birth of Jesus? Answer, not a damn thing. In fact, the Puritans outlawed Christmas in 1659. Why, because there was no biblical basis for December 25th to be the birth of Jesus. As has been pointed out numerous times, Christmas is a hodgepodge of pagan rituals and symbols that early Christians co-opted in a bid to convert others. That "Christmas Tree" that Roland laments is now being called a "Holiday Tree", pagan symbol. Mistletoe, pagan symbol. Do I need to keep going?

While he then goes on to rightly decry the orgy of consumerism that takes over this time of year, he finishes his commentary with another gem of idiocy: "secularism must never become so prevalent that our religious traditions are discarded".

Oh no, here come those scary secularist. Seriously people, is your omnipotent, onmipresent, omniscience creator of the ENTIRE UNIVERSE going to be pissed that we say Happy Holidays instead of Merry Christmas. Wait, what if I say Merry Christmas, even though I'm an atheist. Does that mean I'll be going to that special part of hell where Judas lies as well?

It's hard for me to take people seriously when they start whining about people no longer saying Merry Christmas, calling Christmas Trees Holiday Trees or the like. Especially given the fact that it's such a bullsh*t holiday in the first place. For what it's worth, I like holidays. I get off from work, I get to spend time with the family. We go down and spend time with the wife's family, and getting and receiving gifts can be fun as well. That's all I need for the holidays to be enjoyable. I have no need for Christ or Hannukah candles. And I fail to see how forcing others who don't believe as you to say Merry Christmas makes the holidays any better?

But who cares, so Happy Holidays, Merry Christmas, a belated Happy Hannukah to all. I promise this will be my last rant for the year.

A Bit of Nostalgia

2007-12-18T10:10:00.001-05:00

I was going through some old files the other day and I happened upon some old Java code I wrote in 2003. It was for a binary search tree. For those who don't know, it's a way of storing data that makes certain things easy to do like searching for values.

Anyway, I was looking through my old code and I could hardly follow it anymore. Not only that, but this was something I did for fun back then! Seriously, I don't know what I was thinking. As I strained to understand what I did before, I remember how good I use to be. Not to sound cocky, but I was a good programmer. The code is well structured, commented clearly, each method of the object made sense and there is a minimalist sense about it. Not a line was wasted for superflous stuff. It was good code.

But part of the reason I lost interest in programming was because I didn't feel like I would ever be good enough. In college, there were guys who could code circles around me. They could quite literally code all day and night and I just did not have that in me.

Thinking back on the career decision I made to go into finance, I wonder if I made the right choice. I was talking to my wife about this and she reminded me how I use to curse profusely at the computer trying to get code to compile and often how a misplaced comma or semicolon would cause me hours of grief trying to debug. I certainly don't miss that aspect of programming at all.

In the end I think I would have been fine as a programmer. Most likely I wouldn't be making the kind of salary I'm making now, but it would have been a comfortable life. Oh well, just a bit of nostalgia for the day.

Taking a look at where I've been

2007-12-12T16:30:00.001-05:00

My goals for 2007 were a bit hit or miss this year. Here's what I wanted to accomplish:

Pass Level II CFA
Lose weight
Spend quality time with family
Double kid's 529 balance
Double 401(k) balance
net worth target: $25,000
Build a cash reserves
Kick ass at work in new role

How'd I fare for this past year:
1. Pass Level II --> done and done 1/1.

2. Lose weight, specifically get under 200 lbs --> nope 1/2

3. Spend quality time with wife and kids --> yea, I certainly did that 2/3

4. Double kids 529 account balance --> Starting Value: $1,758, current balance $2,432, don't think this one is going to happen, even with Christmas contributions. 2/4

5. Double 401(k) balance --> Starting value: $5,800, current balance $14,360 (this is the vested balance). Done and done 3/5

6. Net worth target $25,000 --> not going to happen 3/6

7. Build a cash reserves (emergency fund basically) --> also a no, 3/7

8. Kick ass at work --> more or less, yea, I did a reasonable job with this 4/8

So I accomplished 50% of the goals I set out to accomplish. Not too bad there, not great either. Why didn't I accomplish the other goals? I didn't really have a plan, I just kind of said, "wouldn't it be nice". Next time around, I will attempt to make SMART goals for 2008.

I Know What I Want for Christmas and Other Miscellanea

2007-12-11T17:47:00.001-05:00

I want a rice cooker. A really good rice cooker. We eat rice everyday in our household and we've gone through 3 different cheap ones already. All I want for Christmas is a nice rice cooker. Does anyone have any suggestions from Amazon?

I met with my manager to get my bonus information for this December. It was about 10% more than I was expecting. Additionally, my bonus was raised for next year and I was given some deferred compensation that could amount to 30% or more of my salary...after two years or so (its a type of retention compensation).

All in all, I was pleased with my compensation for the year. In terms of the constructive criticism I received from my manager it wasn't really anything new. That is to say, I already know what my weaknesses and strengths are right now. He essentially said, you do this one thing very well and it was very helpful this past year with the uncertainty in the financial markets, but if you want to have a future here I'm going to need you to branch out and do more. He said I need to be more aggressive. I'm not sure if anyone reading this realizes, but I am not an aggresive person. So while I'm aware of my weaknesses I'm unsure of how to overcome them for the coming year. More to come on that.

Right now the market value for our retirement accounts (401(k) and Roth IRA) is approximately $29,000. By the end of January 2008 I expect this amount to be (assuming a flat market) approximately $46,000. We're planning on funding our Roth IRA for 2007 (sometime in 2008) which will add another $8,000 to put the market value of our retirement accounts at approximately $54,000. That's pretty sweet and awesome. Vesting on the other hand, kind of sucks, as I don't have full claim to that amount.

For our debts, we're going to be paying back more than $15,000 in credit card debt and then in January we'll probably take out $10,000 more which should net us a positive $5,000 in terms of net worth. Why are we taking out more credit card debt? A few reasons. One: we need to pay for part of my wife's tuition that we would otherwise have to pay with expensive un-subsidized student loans. I think we can do better with am introductory credit card offer, especially since we plan to pay this off in a year. Moreover, we are in danger of losing the tax-deductibility of student loan interest once my wife starts working later in '08. It would probably take at least one more year, but it makes the prospect of taking out those loans less attractive in addition to paying a relatively steep origination fee. Two: we are also going to use that money to fund our Roth IRA contribution for the 2007 tax year. And lastly: we are using part of this to prepay our auto insurance bill for the year and save some money.

I'm hoping to have a post looking back on the year and of course looking forward to 2008 with some goals and what not.

Clearing up one point about subprime "teaser" rates

2007-12-06T12:08:00.001-05:00

Nick over at punny money is ranting and raving (rightly so) about the proposed plan by Paulson and Bush Co to freeze subprime "teaser" rates.

I'd like to clear up one of the biggest misconception of this whole subprime mess and that is these less than stellar borrowers were getting ridiculously low interest rates (below 5%). That's quite false, most of these borrowers were getting rates in the 7-8%. Even prime loans aren't at that high right now with the rise in interest rates (conforming at least, no idea about Jumbo). So yes, these subprime borrowers started at a higher rate than most and they were going to reset higher (9-10%) but now they get to keep that rate.

Now, I'm not trying to say that we as citizens shouldn't be outraged by what kind of precedence this sets up, and Nick mentioned many reasons why he is outraged.

If the government can come in and change the terms of a contract, what does that mean for credit cards? Will they come in and say everyone that has a large balance was deceived and should now only pay 3% instead of their default rate of 29%? Oh, and by the way, everyone who pays their balance on time, you get nothing.

Does that mean that I should start running up a large balance instead of being responsible with my credit cards because the government will now decide that I was "deceived" into getting my credit card? Have these people ever heard of moral hazard, I already mentioned that already and this plan seems to be the very definition of moral hazard.