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August 5, 2005
Monthly Wrap-Up:
July 2005
I just finished putting July 2005 into the books:
| NOTE: I carry no revolving, interest-bearing credit-card balance. I do, however, use credit cards to my advantage whenever possible. This includes using credit cards to generate rewards from normal, everyday usage. However, I always pay the full balance each month. I also use low-rate offers to generate profits via arbitrage. At this time, I am holding a balance of roughly $7645 on one card, carried at zero percent interest through November 2005. Those funds are concurrently held in an account at ING Direct, where they earn me 3.15 percent annually. |
Readers may recall that an extra pay period last month (June) allowed us to increase our net worth by over $1,900 from its level at the end of May. There was no "extra" paycheck in July, yet our net worth still managed to climb by 2 percent — or $1,619. All things considered, I'll take it.
Sure, it could've been better. I could have chosen not to purchase a combo DVD/VCR for our bedroom, thus saving $86 in the Cash Flow chart below. However, it's really nice to be able to watch movies at night without worrying about waking up our daughter. (Much tougher to do with the entertainment system in our living room.) Plus, football season is right around the corner ... and the second VCR will come in handy when it's time to tape my beloved Sooners' games on Saturdays.
"Maybe books are your Latte Factor," an emailer suggested to me during a correspondence last week. I snickered when I read this, but not because I think the idea is silly. Not hardly. No, I'm quite certain there's a big measure of truth in that statement.
I've adored reading since I was a child. My mom, now a semi-retired third-grade teacher with the most perfect cursive handwriting you've ever seen, swears she read to me before I even came out into the world. All I remember is that Book Fairs and Weekly Reader Fridays were big-time in my elementary-school world. Oh, Judy Blume books got me started, I guess, followed shortly thereafter by The Three Investigators, Encyclopedia Brown, and the Choose-Your-Own-Adventure series. Then came the World War II and history books and biographies of the U.S. presidents, and I was off to the reading races. I have to wonder if Amazon.com's Jeff Bezos saw me coming ... and smiled.
I'm slightly older now, but I'm not letting up: July saw me shell out $116 for books. (No, I didn't pay cover price for any of them. Doing that, at least, is a rarity for me.) The "Books to Read" box next to me (it never seems to get smaller!) says I purchased Freakonomics, the "Everyday Math" book, Anna Quindlen's Loud and Clear, a scrapbooking how-to for my wife, plus a couple of Miss Spider books for our daughter. I may be missing a few in there, too.
"So why don't you do something about this, Michael?" readers might be asking. "Use the library, and stop this money drain." I've tried that in the past; it didn't work. Why? Because I rarely read books only once. (In fifth grade, as I recall, I checked out a book titled From Pearl Harbor to Iwo Jima four times in one year. I read it in full each time.)
As for my book habit, well, there's the obvious educational and entertainment aspects, of course. But books also make great fodder for article ideas, both for this site and for the other writing projects I undertake. And because I continually turn to my personal library for research, hope, affirmation, and motivation. Come to think of it, I'm not sure how you put a price on those last three things.
So yes, I can and do spend a fair chunk o' cash on books. But in so many ways, those books stay with me for years ... if not forever. It is one of those cases where I feel that the book money I spend now — and what I've spend in the past — is and has been absolutely worth it (and important) to me personally.
Anyhow, on to other things.
It's a pretty new page, but already a heavily trafficked one (for this site): My Balanced Money Formula page is attracting Google searches galore, as well as drawing visitors from message boards all over the place. Seems that people are pretty interested in Warren and Tyagi's suggested financial ratios (if only to make fun of them ... sometimes). With that in mind, I will continue to post my household's monthly results as they compare to the 50/20/30 guidelines recommended in All Your Worth. If nothing else, it's interesting to me. Something else to shoot for, right?
That's how my BMF ratio looked in July: 55% spent on Must-Haves; 24% on Wants; 21% to Savings.
I'd like to see that Must-Haves percentage come down, of course. But as I look at my Quicken cash flow reports, I really feel as if the only viable way it can happen is if I somehow manage to boost my income from this point forward. (Rather than lopping big $$$ off of my expenses, I mean. I simply don't see much room to cut there.)
Michael |
August 5, 2005
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