Can I save for a home and pay off my debt at the same time?

Sorry for being gone for so long; the month of April was ridiculously busy at the 9 to 5. But I'm back strong and with a good question that came from formspring:

I'm almost debt free and I want to start saving for a down payment. How can I aggressively tackle the last credit card...and save at the same time?

My advice: Don't spread yourself too thin. You have a finite income and that money only stretches so far. If you're almost debt free, you should devote as much of your income as you can to paying off the debt until it's gone. That will help you as much as saving for a down payment (on a home, I'm assuming) because lowering your debt will help improve your credit score. When the debt's gone, take the money you were putting toward that and apply it to a down payment. Take your time and remember you can't do it all at once.

Also, how much money do you have in an emergency fund? If it's less than six months worth of your living expenses, that should be your priority over both a down payment and paying off debt. What you don't want to do is be in a situation where you've got to run up credit cards or beg, borrow and steal if you should  lose your job.

Good luck.

Financial Literacy Month

February was Black History Month; March, women's history month? Anyone have a clue what April is? Hint: It's the title of this blog post!

I view the idea of Financial Literacy Month the same way I view the other "months" celebrating ethnic heritage, gender solidarity or any other cause or purpose. It's nice to take 30 days to emphasize the need for a basic level of financial smarts in this country. You need only look at our abysmal personal savings rate, how many adults live on credit and how many of our young people lack basic consumer skills like how to create and live by a budget to know that there's a serious need for financial education in this country. But having a "month" is only a start. What happens when April is over and all the marketing campaigns go away?

I'm a big advocate of making financial literacy a mandatory and integral part of the school curriculum from the earliest levels. No one should be able to graduate from high school without demonstrating that they can manage the wages they'll earn on a job. But more on that in a later post.

Here, I just want to create a list of links to Financial Literacy Month sites and other programs that are focused on personal finance education. It'll start short, and grow as people point me in the direction of more links, so be sure to tweet me any you have.

Financial Literacy Now: A campaign for financial literacy sponsored by The McGraw-Hill Companies, The New York Public Library, Working in Support of Education (W!SE), Literacy Partners, and Talking FinLit

FinancialLiteracyMonth.com: A site promoting the month, it's purpose and events from the nonprofit Money Management International

America Saves: "A nationwide campaign in which a broad coalition of nonprofit, corporate, and government groups helps individuals and families save and build wealth" -- from the site's "About Us" page. 

More to come...

Online tools to help with budgeting

Q: I need to grow up and create a budget/spending plan. I'm a techie, so can you recommend some online/software to use to create a budget I can stick with?

A: First, congratulations on your decision to start budgeting. Here's a few tools you might want to look into:

• Mint.com tracks and categorizes your spending so you can tell exactly where your money is going in real time. That's extremely helpful when you're trying to budget because you can instantly see if you're overspending on non-essentials like dining out or too many pairs of jeans. Mint can also keep track of spending from multiple bank accounts, track your investments and work with tax software TurboTax to help you find deductions.
• One thing many people neglect when budgeting is the difference between their gross (before taxes) and net (after) incomes. Since no one actually lives on their gross income, it's necessary to estimate how much you'll pay in state and federal taxes, and other pre-tax expenses like some retirement account contributions, your contribution to healthcare premiums, etc. PaycheckCity is a free online tool that I've used nearly every time I've taken a new job to figure out what my actual net income might look like, and it's always been pretty accurate. It'll ask you for your gross salary, and then you'll plug in the state you live in and answer other questions about deductions likely to come out of your paycheck each month. At the end, it spits our what your net pay should look like. One thing it won't ask you for is any personally identifiable information, so there's no privacy concerns.

Those are two to get you started. I'm going to tweet this question to my followers and post any of their answers as they come in. Good luck.

When she makes more

I got three questions yesterday from a woman who wanted my opinion on her friend's pre-marital financial situation. The questions paralleled yesterday's post about income inequity in relationships (i.e., who makes more and more importantly, who cares).

Long story short, in a couple that plans to get married soon the woman makes far more than the man. They have a joint checking account and the lower-earning man wants to use some of the money from that account toward starting a business (or as the questioner put it, for his "business schemes).

I don't know much about what kind of business he plans to do or exactly how much of an income disparity we're talking about, so I have to go on what I'm told is a very big income gap between the two. There are three questions here, and I'm answering them separately:

Do you beleive in pre nup/financial agreements between couples who are getting married? Especially if it is a significant difference in salaries?

I don't think your current financial situation matters to whether or not you get a prenup; I believe everyone should seriously think about having one.

Remember that prenuptial agreements aren't just about where you are before you get married. They're legal documents that are supposed to be structured to protect people's assets and interests in the (hopefully unlikely) event of a divorce. Everyone who gets married knows that divorce is a possibility, though most people, rightfully, don't want to focus on that.

A difference in salaries as an engaged couple might make someone more likely to want one, but that doesn't mean folks of the same income levels shouldn't also consider one.

If there is money left after monthly expenses in the joint account, should one partner use the leftover for personal reasons I.e starting your own business?

That should be a decision made by both partners. If the money is coming from funds that have been jointly saved, that technically -- and probably legally -- would give both people equity in whatever business venture was being started. In other words, if I take money from OUR joint account, I'm automatically making YOU an investor in whatever business I start.

So the other party should be as active in investigating and doing any vetting any business opportunities and if they're not comfortable, the business plan needs to be tweaked or scrapped.

What is a fair percentage for couples to put in joint account? If one spouse makes more should they put more in joint account? Should a percentage of individual bonuses be put in the joint account?

I think contributing to joint accounts on a percentage basis is a good idea because it makes both partners responsible at the same level of their contributions, regardless of income. If a couple were to contribute a particular dollar amount of their salaries, the partner making more money would obviously be able to contribute that more easily -- and perhaps at a smaller percentage of his or her salary -- than the partner with the lower income. But if both agree to save, say, 30 percent, both know that they're giving at the same level, though the partner with the higher income will be contributing more on a dollar basis.

But more important than how much is how the decision gets made. This is something to be talked about and agreed to together. If a couple can come to an amicable solution together about how much each person contributes to expenses, savings, investments and other goals, that's a good start for them.

I sincerely hope these answers reach the couple they're intended for and that they make the commitment to get some financial counseling before they leap into marriage. Unfortunately, the only thing that breaks up marriages more than money is infidelity, so making sure there's a solid commitment in romance and in finance is key to making it last.

Good luck in love.

Bank overdraft fees lead to lawsuit

Do you get hit with high overdraft fees from your bank? Sick of it?

In most instances, I'd say that should make you pay more attention to how much you're spending. But what if your bank was charging you with fees even if you had enough money to cover your expenses? That's what one woman who is suing her bank, Fifth Third Bank in Cincinnati, is claiming. (Fifth Third sued over overdraft policies).

Since the suit was just filed, it'll be a while before we know how the court comes down on this, but I suspect many people feel vindicated just because of the lawsuit itself? How many times have you felt screwed by a bank with no recourse? I know I certainly have.

A few years ago I got a fat check for some freelance work and deposited into my checking account at an ATM machine. This was normal and I'd never had a problem doing so. A few days later, I wrote checks to cover some bills, and I'll be damned, they all bounced. Why? Because the bank never credited my account with the amount I deposited. A bank representative told me on the phone that that was because they didn't recognize my signature on the back of the check (as if someone working there KNEW exactly what my signature looked like, and never mind the fact that the name and address on the check matched the name and address on my bank account).

It took a few days and I finally got the issue resolved, but for about a week, my bills were unpaid, I had no access to my own cash and I'd been hit with more than $100 in overdraft fees. All of this happened after I deposited a check into my own account for more than double the amount of bills Id written checks to pay.

Needless to say, I switched banks. So I'm curious: what are some of your bank fee horror stories? Unfair overdrafts? Onerous ATM fees? What does your bank do that you hate?

Posted using ShareThis

Track expenses daily to keep the budget in line

Last Friday was the final Friday of January and you know what that means: payday. Like I always do on payday, I woke up and texted my bank for a balance just to make sure I wasn't fired two weeks ago and hadn't been told. The good news is I still have a job. The bad news was that I had a balance in my checking account that was short of what it should have been after payday.

Fortunately, I'm not in a position where that means I can't make the rent. But it does mean I spent over my budget between this pay and the last and in fact, I've probably been less disciplined about my spending for a few months.

So this month I'm going back to the drawing board with an exercise I haven't done in a few years: keeping a running tally of all my spending for 30 days. This is something I think everyone should do at least once every couple years, or when you make a significant change to your budget. It's easy to make a budget by estimating fixed expenses like the rent, light bill, cable and car insurance. But seeing everything you spend on paper, including small things like the junk food you bought at lunchtime, shows you how much money you're really spending and more importantly, where you're wasting some money.

This past weekend, I spent about $220 that wasn't in the budget, for example. While that money came out of disposable cash that isn't set aside for any particular purpose, spending like that on a regular basis without tracking it can wreck a budget.

So if you're not tracking your expenses, you should try it. Get small notebook and keep it with you every day for a month. Every time you spend money, on anything, write down the item, the date and the exact cost. Add it up at the end of the month and find out how much you're really spending.

The $0 Balance Countdown

This is it: the big week when I'll be making the final $500 payment on the credit card balance I've been carrying since college.

I can't wait to feel the exhilaration of hitting the "make payment" button, logging in the next day to see the balance reflected as $0, and knowing the liberation of having hundreds of suddenly available cash flow in my budget every month after that. In fact,it's such a great thought and a great feeling, I want you to have it, too. So I'm issuing a challenge: how many of you believe you can eliminate all of your credit card debt in the next 12 months, using nothing but sheer financial discipline and sound budgeting?

If you think so, hit me up with your story (keithtr(at)gmail(dot)com or on twitter). I'll pick a few people to follow and chronicle here monthly as they work toward their goals.

In the meantime, I'm devoting all this week to posts about credit cards and debt elimination, be sure to check back.

photo courtesy freedigitalphotos.net

Things for new investors to consider

Today's question from tweeted to me by @JNeedHisScrilla (love that handle):
What is the best direction to go for a first time investor with limited funds?
That's a tough question to answer, because like choosing a mate or a place of worship,choosing a smart investment strategy is intensely personal. Where you put your money, and how much of it you put there, should reflect your own goals, resources and time frame. There are as many reasons for investing, and kinds of investments, as there are people with things to spend money on.

But here are some common reasons first-time investors get in the game and things you should consider:

• To save for a first home. Usually, putting your downpayment savings into stocks or mutual funds doesn't make sense because of the risk of losing money. But if you're young and not planning on buying for 5-7 years, you might be able to weather a downturn and still see a return on your principal before you have to touch that cash. You probably still want to keep those holdings separate from any other investments.
• To save for retirement. This is likely to be the first introduction to investing that most young professionals will get. You start your first job and they hand you your benefits packet and that includes information on the company's 401(k) plan and an enrollment form. Read that information from first word to last, and then enroll at the maximum level you can afford to. If you're working and not in your company's 401(k) or other retirement plan, there's really no point in thinking about any other kind of investing.
• To save for a business. To build capital for a business. The same rule as saving for a home downpayment applies: don't put money into the market that you're going to need over a short time frame. But if you don't think you'll be hanging out your own shingle for at least five years or more, this might be an option.

In any event, the best thing you can do before you begin investing is to learn as much as you can about investing. Do you know the difference between equities (stocks) and fixed income investments (bonds)? Do you know what a mutual fund's expense ratio is (and do you even know the difference between funds and individual stocks?). Before diving into any major endeavor, you need to know as much as you possibly can to mitigate your risk.

Good luck.

photo courtesy of freedigitalphotos.net

Why the homebuyer tax credit should be extended

I saw this question on Twitter yesterday and had to post it: Do you think the 1st time homebuyer tax credit should be extended past November?

The credit was approved by Congress last year to try and fix the foreclosure problem. It expires soon, so Congress is debating whether to extend or even expand it to a $15,000 credit.

My answer is it should be extended for another year. Here's why: though some are optimistic the recession is ending, we can't afford another "-less" recovery -- as in "job-less" or "homebuyer-less". The economy needs housing stability to be really strong and that's not possible until people have jobs again. Employment will likely be one of the last things to recover, so without help, people still won't be making major purchases like homes.

Note to haters: I'm NOT suggesting that the government subsidize home purchases for the unemployed. My point is that average people don't judge the economy's strength like economists do; we go by what we see in our checkbooks and what's happening around us. If a lot of my friends are still out of work or being laid off, I'm not likely to be comfortable borrowing a few hundred grand for a new crib.

On the other hand, the one good thing about the recession is that it caused working people to re-evaluate their financial habits. I believe a year from now, many people who weren't previously able to save enough for a down payment and to clean up their credit will have done so, and at that point there won't be a real need for an $8,000 or $15,000 tax credit anymore.

But that's a year from now. Until then, I fear for people like my friend who's home in suburban Cincy has lagged on the market for more than a year without a single offer, despite repeated price drops and an attempted short sale. Congress should renew the credit.

Should I sue my condo association?

I received this question via email:

Hi Keith, I have a question regarding a condo association. We have recently experienced a building fire and are now all displaced. The condo association is requiring all owners to continue to pay monthly assessments. Is this legal? We have been told that we will not be able to live in the building for one year. The building has 80 plus units, imagine all of that money not being used! Help! Do we have any grounds to sue for these assessments back? Any input will be greatly appreciated. I have no where to turn. Also, any suggestions on how we, the homeowners, can get the ball moving? It has been 3 months since the fire and no work has been started. We are all worried that our individual insurance will run out before the building is finished, and then what? By the way, our condo association is not pleased that we are contemplating the possibility of litigation.

Thank you for your assistance

Since I'm not a lawyer and I'm assuming the reader (who didn't want her name used) isn't either, my first and best piece of advice is that she needs to consult an attorney before proceeding with anything. Litigation may or may not be a good option, but qualified legal advice is certainly a great option.

One thing to remember is that as an owner, you are a member of the condo association and technically part of your building's management. In other words, if you brought suit against the association, you'd in part be suing yourself.

Otherwise, I wouldn't necessarily assume that your condo fees aren't being used. The association must continue to operate after a catastrophe like a fire. Expenses like filing insurance claims, getting estimates and yes, legal fees, have to be incurred whether you're living in the building or not. Look into what kind of cash reserves your association has and what kind of insurance policy as well. That will be important.

Good luck.

On hiatus for relaunch

I'm sure you've noticed I haven't posted since May 18. I have good reasons: 1) I spent the bulk of the last three weeks traveling and 2) after considerable thought, it's time to relaunch and revamp the blog. So I'm putting things on hold until about late June. When I come back, you can expect a few things:

• a better layout, images or video with every post and just a generally better looking blog
• better topics. I've noticed how loud the crickets are when I post about the economy and I get more responses when I answer questions that are on people's minds. Look forward to more chances to ask questions and also talk about career choices and other decisions on the periphery of personal finance.
• I may or may not keep the blog here or migrate it over to wordpress. Either way, the URL won't change.

See you in late June

Pretty soon you won't know your own credit score

Since I ranted yesterday about the need for more financial education, I was going to make today's post about a good program a friend told me was going on in some Louisiana schools.

Leave it up to the credit rating agencies to ruin a positive end-of-week post. Experian, one of the three agencies whose ratings of your credit are the most important factor in whether you can borrow and how much interest you'll pay, is in a beef with Fair Isasac & Co., the company that created the so-called FICO score, according to the New York Times.

The result of their beef is you'll no longer be able to see the credit score that Experian assigns to you, even if you're willing to pay for it.

If you don't understand why that's ridiculously important, think of it this way: Say you were divorced and wanted to remarry, only your ex-husband or wife has told every available single person in town that you were no good. The problem is no one will tell YOU that you're being called no good, so you can't understand why no one will date you.

In this situation, Experian is the equivalent of the rumor-spreading wife: telling every lender or employer who asks how good or bad your credit is, but refusing to tell you what your score is.

Unless there's a fix for this soon, I imagine many consumers are going to find themselves with a problem.

401(k) bootcamp

Yesterday I got another example of why financial literacy should be mandatory in schools and provided as part of a benefits package from employers. A woman in her early 20s found me online yesterday and had a line of questions a mile long about 401(k)s.

The questions were riddled with clues about her lack of knowledge of basic investing principles: What's the difference between a 401(k) and an employee stock purchase plan? Does the value of my 401(k) drop if my company isn't doing well? (Not unless all you have in your 401(k) is shares of your company's stock). The market's bad; shouldn't I be taking money out of my 401(k) and putting it into a regular savings account? (No, that'd be one of the worst things you could do.)

Beyond that, she wasn't sure what investments she had chosen for her 401(k), whether they were appropriate for her age and risk tolerance or even how the money she put in translated into shares in funds or stocks.

I'm glad she reached out and I'm not in any way belittling her for having the questions she had. But what's frustrating is that at a time when the country can ill-afford to have it's educated, employed, high-income potential young people financially unawares, our educational system and employers continue to do students and workers a disservice by equipping them to make money but not educating them on what to do with it next.

So all next week I'm doing a 401(k) bootcamp on the blog, going over basic terms and principles of a 401(k) plan, and answering any questions you might have. Now's your chance to learn if you're not sure, so don't be afraid to speak up.

How to make your money last during a layoff

Unfortunately, a few of my friends lost their jobs in mass layoffs in the past year. And while losing your primary source of income clearly sucks, the silver lining is that not knowing where the next check is coming from forces you to learn how to stretch a dollar really, really far.

So I asked a friend of mine -- we'll call her "Sandra" -- for some tips to share about how she held it together when she was out of work briefly last year:

• Filed for unemployment IMMEDIATELY: It now takes 5 weeks (longer than in years past) to begin getting the benefit payments, so this is CRUCIAL

• Cut off all major luxuries: (no more fancy dinners, no shopping, all trips were cancelled) and limited things like hair salon visits (non-essential dry cleaning, bi-weekly hair appointments instead of weekly)
• Paid all my essential bills up front: to make sure things like heat, car note and insurance payments, prescriptions, cell phone/internet were guaranteed to be there.
• Took a part-time job: The work was beneath me, but provided a steady stream of extra cash for pocket expenses (about $150 to $250 a week, depending on how much time a put towards it).
• Set aside enough money to pay credit card minimums: I paid 4 months worth although, I was only out of work for 2 months.
• Deferred some bill payments: I called around to see who would let me defer payments out of "hardship consideration, and both my student loans and gas company were willing.
• Reduced cable services: I kept HD channels, but dumped on-demand and premium channel services.
• Gave my family small gifts and "IOUs" for the holidays: It hurt to have to do this, but I'll make it up to them. I also skipped sending holiday cards.
• Switched to low-cost entertainment activities: I rediscovered house parties, museums, going out for dessert and coffee (instead of meals and drinks) and frequented clubs/parties where I knew people, and could be guest-listed.
• Paid more attention to what I paid for groceries: I shopped on sale days and clipped coupons on higher priced items (like laundry detergent and saline solution).
• Cooked at home WAY more: Being unemployed showed me how much of my money went to waste on food, particularly snacks, lunches and dinners, while on the go, etc., etc.
• Used public transportation whenever possible. The price of gas is less of a concern now than it was last summer, but PARKING is still way overpriced and a huge waste of money in NYC and Boston.

Hopefully, Sandra's experiences will help someone else who reads this and finds themselves unfortunately unemployed. Better yet, most of her suggestions are things that can save you money long before you lose a job. There's nothing wrong with working AND being frugal.

One thing everyone has that's worth more than cash

For obvious reasons, I post mostly about how people earn and spend money. Today I'm writing about how you spend a more valuable resource: time.

In a conversation over the weekend, a friend summed up how much more valuable time is than money this way:

Time is the only thing we can't earn more of.

So true. And if you really think about it, the more effectively you manage your time, the more time you'll have to think and act creatively and more productively to earn more money (and spend time enjoying what you're earning).

So let's try something: for the next week, try to practice one thing that helps you use your time more efficiently, and post what you're doing and how well it's going here. I'm going to start by being more meticulous about keeping prioritized lists of the things I need to do each day and concentrating on getting done only the most important things.

Good luck.

A lesson in losing money by not paying attention

This is a link to a chart of my money going down the drain.

I got a letter from the brokerage UBS. I'd been getting these letters for a while but always ignored them because I knew what they were about: my old New York Times Co. employee stock purchase account. I only put money into it a few times about five years ago, then stopped because the stock sucked and even with the discount I got on shares they always ended up underwater (worth less than I was paying for them).

Problem is I never dumped the shares and forgot I had them, until this week. Anybody wanna guess how shares of newspaper companies have done since November, 2004? If you answered by farting or picking your nose, you're right. The 39 shares I owned were worth $41.06 apiece, for a total of $1,601.34, the day they were purchased. It was a good deal then because I only paid $34.90 a share; I saved more than $300 off their market value.

But the stock was only worth $5.53 a share as of this morning, meaning I've lost more than a grand by forgetting I owned them and thus forgetting to sell them before the losses were too heavy. (Click here to see its current value).

Anyway, you don't need to be a stock market genius to get the point: PAY ATTENTION TO YOUR MONEY!!! That means whether you own individual stocks like in this case, of if you have a 401(k), which you shouldn't be actively trading in but should at least make sure you have the right asset allocation for the age that you plan to retire at. Even if you're just trying to get on a budget and pay down some debt, staying organized and keeping track of every dollar you spend is the difference between success and failure.

Real economic changs is up to you, not this guy

While Barack Obama was being sworn in, the stock market was tumbling. The Dow had its biggest Inauguration Day loss ever, of more than 300 points.

When the stock market takes dips like it did yesterday it's a buying opportunity because shares are cheap. It's like shopping at the mall during a sale: you can buy twice as many pairs of shoes at half off as you could when they were full price. The difference with stocks is that when prices come back up, you can't resell the shoes and make money; with stocks you can.

But the big questions are why did the market fall so much and is that a bad sign for the economy under Obama? Reality check: no one has the answer to either question. I've heard commentators speculate everything from another round of bad news for banks to wealthy investors being worried that Obama will repeal the cozy tax cuts they got from Bush (another reality check: Obama's already said he won't immediately raise anyone's taxes and a tax cut could well be part of his stimulus package).

Either way, here's a few words from Obama's speech that everyone should take to heart if they're really interested in seeing the economy and their own finances improve:

Our economy is badly weakened, a consequence of greed and irresponsibility on the part of some, but also our collective failure to make hard choices and prepare the nation for a new age.

"Our collective failure to make hard choices". Collective, y'all. Sure there were a great many greedy folks on Wall Street and elsewhere who made bad loans and absconded with shareholders' money. But they're not the only reason the economy is where it is: If you're like me and still paying off purchases made months ago, plus interest; or if you're still spending way more than you save or invest; part of the problem rests with you, too.

Ultimately we can all wait for an Obama stimulus or the stock or housing or job markets to turn around, but if we all don't make the decision now to save more of our incomes when we get our jobs back, to only buy houses we can afford with down payments and under terms we can understand, and start saving for the retirement we know we'll have to foot (because with deficit spending, social security just won't be around), any recovery will only be shallow and temporary.

So, are you really ready for change?

Need cash? Just borrow from an ATM

Sometimes you see things you just don't believe, and on those days, thank god for camera phones. The image above is what I saw when I went to withdraw money from a US Bank ATM machine at Cleveland Hopkins International Airport last week.

Look real close at the top option on the left hand side and the bottom two on the right. Can't see them well enough? Try this one:


You're not seeing double: when I told the machine I wanted to make a withdrawal, it asked me if I wanted money from my checking or savings. OK. Or, um, did I want an advance from a credit card? OOOOK. Or, maybe an advance from a credit line? Ummm, no, not that one either.

Alright, then. How about an advance against your next deposit?

WTF??

I'm not sure how many banks besides US Bank are doing this at their ATMs, or how new this is. I do know I've never seen those options before. But it strikes me as exactly the kind of things consumers should be avoiding and banks should be wary of. Taking an advance against your next deposit from an ATM machine sounds like a close cousin of getting a payday loan. It's certainly a form of borrowing money, and without any vetting or loan application. Just punch in your PIN and go.

I wonder what the terms are: how much interest do you pay on that advance? How long do you have to make a deposit afterward to cover for the advance you took? How much interest are you paying on top of any ATM fees? If US Bank isn't your bank (it isn't mine), do you pay interest or fees to both institutions?

And what happens if you don't pay the money back?

A life-changing, budget-crashing, celebratory event

Sorry for the pre/post New Year's hiatuses. There's much to talk about in the economy that I'll get caught up on this week, particularly the Obama administration's proposed $300 billion tax cuts (and what there's a good chance they'll lead to higher taxes later), and a few reader questions I've gotten over the past few weeks.

But the real news, at least in my life, is that I've had a series of life-altering events that are affecting my own finances and have kept me away from blogging. Since Dec. 15, I've moved from Cincinnati to Cleveland, left my job as a reporter to become editor of Catalyst Ohio magazine and and in the process of securing custody of my 12-year-old son, Malik, moving him from Pennsylvania and enrolling him in school here in Ohio.

It goes without saying that something like this alters life dramatically in all kinds of ways, not the least of which is financially. Already, I've reconfigured my budget to account for higher spending on food, gasoline, clothes and haircuts, and my health insurance premium contribution will also increase. Some of this, though, will be offset by a decrease in my tax burden (I've ranted in the past about the ridiculousness of my own taxes).

In any event, I'll keep chronicling the financial aspects of the change here. Wish us luck.

We need some resolutions

Well, not really. I actually loathe new year's resolutions because they're usually very temporary. But a new year is a great time for reflection and adjustment, for updating goals and tweaking old behaviors.

So here's where I'm headed in '09:

I started 08 with nearly $8,000 in credit card debt (shudder) which I vowed to eliminate. I didn't quite get there, but I did cut it in half. Priority #1 is to finish the job.

I also need to find new souces of income. The economy did away with two very steady freelance gigs. The good news: it was freelance so I didn't rely on the money to live; the bad is that was how I paid down so much debt.

I'm reading "Rich Dad, Poor Dad", and it's changed my focus in at least two areas. Saving cash for a hous purchase is less of a priority, while investing in assets that produce income, like dividend-paying stocks is high on the list. (BTW, if you haven't already, resolve to read Rich Dad.)

Those are my financial non-resolutions for '09. Share your money goals for the new year in the comments section.

Happy 2009.