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Archive for January, 2007

But I don't wanna save today!

January 27th, 2007 at 01:09 pm

Occasionally my inner child pops up and cries and screams and wants something. Something shiny and expensive. It's been happening for me since the beginning of this year, and even before. Two things I want- a digital SLR camera and a trip to Europe- that aren't cheap.

And here's the thing. I can mostly avoid the temptation of putting them on my plastic. But I can't avoid the feeling that if I just didn't save any money one month- just took one month out of a year off of savings- I could get the camera I want. Just two months off of savings and I could take myself to Europe.

None of my savings is on automatic. I have no 401(k) option at work, and for now I've disabled the auto-save to my IRA, since any contributions automatically made now would go for 2007, and I need them to go for 2006. I have to make that choice each pay period, to save money rather than buy the things I want.

The only thing that's really keeping me honest? The knowledge that the project I'm on at work is ending in February, and I may not have a job for a while after that. Oh, that and the fact that I need some dental work soon. Also not cheap.

I love optimistic retirement calculators

January 20th, 2007 at 01:18 pm

This one: http://finance.yahoo.com/calculator/retirement/ret-02
says that I need to save between 3.4 and 7.1 percent of my gross salary to have a comfortable retirement, not counting social security or anything.

Not that I believe it, of course.

Right now I'm saving 15%, though I'm not quite sure what will happen when, sometime next year, that amount begins to exceed the amount I'm able to put into a Roth IRA. I would like to open a taxable mutual fund account in a tax-efficient index fund, but I worry that the small amount I'm able to invest in it every year would make it not worth the fees. After the Roth limit goes up to $5000, I would only be able to invest $1000/year outside of it, and not only does the fund I'm considering have a minimum of $3000, but it has low-balance fees up to $10,000. Only $10/year, but, you know, it adds up.

We'll see; it's not something I have to consider seriously at the moment.

And no, no 401(k) at work. If that becomes available within the next two or three years, that could change my plans too.

Playing catch-up

January 19th, 2007 at 03:46 am

Tomorrow is payday, my first for 2007. I know I need to catch up on my Roth IRA contributions for 2006. I've only put in about half what I'm eligible to put in for 2006, leaving me with about $2000 to go before April 16 if I'm going to max it out.

If things go well, and I'm consistently employed through that time, I anticipate making it just out of contributions of 15% of my gross pay.

If I'm not (the more likely alternative), there are two ways it could go:

1) I become unemployed in the middle of February, start living off my emergency fund, stop contributing to my Roth IRA, get my tax refund check, continue living off emergency fund and tax refund check, become poorer and poorer till I find a new job/ get on a new project at the place I'm currently employed, fail to max out 2006 Roth IRA.

2) I become unemployed in the middle of February, stop contributing to retirement, but get re-employed before the middle of April. In this case (if I get put on a project that's going to last at least 6 months) I'll take what I need to max out my 2006 Roth IRA from my emergency fund. I can re-grow my emergency fund- and I'm not going to let it get below $1000- but I don't want to miss my chance to contribute the full amount for 2006, if I have any alternative.

Then it's on to thinking about 2007...

Testing this weekend to get on a new project at work. Hope that it goes well; I would rather stay employed than the alternative.