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Archive for May, 2006

Mutual Fund Research/Misc

May 31st, 2006 at 08:33 am

Spent a few hours on Fidelity.com last night looking at mutual funds for my pension $$ I should be receiving any day... (and then send off to Fidelity to join the other retirement stuff). It'll bump my retirement fund savings to $11k/$12k which isn't a lot, but better than nothing! I need to allocate a little better if I'm going to live through these big ups and downs in the market... maybe some bonds instead of NO bonds... I hadn't purcased any bonds before because I thought I was strong enough to stand the risk of all stocks... but watching my portfolio this last week has really made me think "BALANCE" - I need to balance my portfolio.

With the house money in a few weeks, I'll probably place it in Vanguard, in a nice index fund with low management fees and no 12b1 fees, but then I'd have a little at TIAA-CREF, Fidelity AND Vanguard which I don't think is too smart. The thing is that I love my Social Choice fund and the other growth fund at CREF and my retirement stuff was already at Fidelity, so I kept it there and I haven't opened anything at Vanguard, yet, but I love their index funds. Unfortunately, Fidelity charges $75 per transaction which makes me cringe. Oh, what to do, what to do. The cash that I'm not putting into the Roth will be around $10k and it'll go into ING until I get a handle on what to do with it.

I've probably already posted on my worries about this money, but it's something that is still hanging over my head... I don't want to screw up... since:
a) I'm not working
b) this is the last windfall I'll probably get in a loooonnnngggg time
c) I need a "girl's safety net" to feel comfortable
d) doubtful that I'll inherit any money
e) doubtful that I'll be making any significant money in the next couple of years since I'll be home with the little one

Back to the research.

Ah, and the credit card is back in the dungeon of our closet since I had started spending a little on it... $100 for summer shoes for DS and I which we needed, but I don't ever, ever want to have a credit card balance again. EVER! Which means cash, baby. Being in credit debt rebound is tough.

When should financial institutions be held accountable?

May 24th, 2006 at 02:10 pm

My SO got me a European charge card from his bank the other day so that we can use Euros for the coming year from his bank account over there. (This is the year we'll be making about half of our salary for education pursuits).

It got me thinking again about the book that had the 50%Needs, 30%Wants, 20%Savings strategy that I've been using for the last year. Pregnancy has affected my brain, so I can't remember the title, but it's a great book. Smile

Anyhow, the writer's talk about how in the 1950's a person COULDN'T really go over their credit line, and COULDN'T spend more than 25% of their income(or so) on their house and the banks WOULD NOT loan the money for a new car that they didn't think you could afford (using much stricter guidelines than they do now). Etc., etc., etc. Their point was that "fixed" expenses were much much lower than they are/can be today. Hence, many people are in straight jackets because of their fixed expenses.

Back to this charge card thing... SO tells me that I have a credit limit each month, but that the bank automatically takes the payment out monthly and pays the card off in full. He didn't have to sign up for this, they just don't have "credit cards" where he's from, they have "charge cards" like the American Express card that HAS TO BE PAID OFF and if you don't have the money, they revoke the card. That's it. End of story. Is this why Europe has a higher savings rate on the whole than we do? Which brings me to the question at the title of this entry, at what point should financial institutions be held accountable?

Isn't this a little hard on the individuals who borrow this money to be in such financial difficulties? How does it affect a person/family's quality of life if they're in debt up to their eyeballs? Yes, I know, people need to take responsibility for themselves at some point, but that would mean they'd need to be educated as well... kind of like those hazardous messages on cigarettes. If a person hasn't been taught, how are they to KNOW? It took me a long time to get out of debt. What would life have been like if I hadn't gotten into debt in the first place... ? Did it kill me to eat macaroni and cheese dinner 4 nights a week because my house payment and credit card bills took up almost all of my paycheck? Nooooo.... and it's my fault. I just wonder for the rest of our kids, our future, "what if?" What if companies were forced into more reasonable borrowing percentages? And what if credit card companies were required to have higher minimum percentages on the balances owed? The list is endless and this is long. I just got that charge card application in my hand and had to wonder how it is that we're going to compete with the rest of the world when we as a people have no savings.

P.S. Contrary 1 - couldn't figure out how to send a private email like the old set-up on the site. I'll keep looking. And baselle... I don't get the emails when comments are posted, but see above. I'll keep looking. Smile

Help?! Moving to Seattle - need info

May 23rd, 2006 at 04:33 pm

If anyone has recommendations for life in Seattle, we'd love to hear your comments. We're relocating and will be living just NE of downtown (not too far). Since everyone on this site tries to get the best bang for the buck, we're wondering who you use for:

-cable internet (faster than DSL)
-renter's insurance
-car insurance
-which brick and mortar sp? bank (low fees, no monthly fees, etc.)
-anything else?

We don't have cable and won't start when we move...and I think gas and garbage will be paid by the landlord. I've never been to the Northwest, so have no idea which companies to even start looking at. Someone from that area sent me an email from Comcast.net, so I'll start there for cable internet, but golly, there's a lot! AND.. it doesn't help that we're already going to be paying double in rent what we're paying for our mortgage. Life in the big city, I guess!

Thanks for reading!

In Love with Larry E. Swedroe

May 23rd, 2006 at 08:07 am

When I first saw, "What Wall Street Doesn't Want You To Know" on the shelves of my local library, I passed it over for something I felt would be a little more interesting.
Then, a friend brought Sedroe to my attention later in the week over coffee. "It's a good strategy, you should read him."

So, I did.

And I'm in love. I've read a lot of books on why index funds are the best things to invest in, but I never felt that I had the back-up information to support that claim.

Now, I do.

Too bad my parents, who are very much interested in "choosing the right stock" and "making money!!" by trying to time the market, etc., etc., etc. haven't read him as well.

Bummer that my money is in Fidelity where index funds aren't flouted and active trading is. Will have to check out to see if I can buy other funds that aren't Fidelity and see how much the fees are going to be to buy them.