Final 2008 budget

Tax Cut wins!

I decided to purchase Tax Cut again this year. I did try out Turbo Tax by downloading the software they sent me in the mail…unfortunately it caused an error in trying to tell me that I did not itemize last year which is not correct. Somehow it found my saved tax return on my computer. That error which would have made my 2007 income wrong by mischaracterizing my state income tax refund along with the difference in price was enough to send me back into the arms of Tax Cut. I purchased it at Best Buy for $69.99 which included the federal and state versions plus e-filing for both. The Tax Cut version that did not include e-file was $39.99. Turbo Tax does not have a version that includes e-filing (they charge an additional $17.95 per tax form) and the cost was $44.99. Once the e-file is included then Turbo Tax would have cost me $80. I have a $10 mail-in rebate for both Tax Cut and Turbo Tax. I know that price is not everything but my taxes are not complicated and the Turbo Tax version created an error so I am happy with my choice. Next year is another story.

Delta Skymiles Medallion Bonus

I realized yesterday that I was about $2,000 shy of earning the 10,000 Skymiles bonus for spending $25,000 on my American Express card in 2007. I put almost everything I can on the card and pay it off every month. Like the commercials say…double skymiles for groceries, gasoline, drug stores, etc. I made a strategic decision to accelerate my final cruise payment which was not due until February 1, 2008 for my April cruise and to also go ahead and buy the plane tickets. That leaves me just $437 shy of the spending threshold. For those of you not familiar with the Delta Skymiles program, Medallion miles help you earn silver, gold, or platinum status. Usually the only way to earn Medallion miles is to fly with a few exceptions and one of them being the $25,000 per year spent on a Delta Skymiles Amex card. I earned the 10,000 for 2006 but in retrospect I only got to silver status as I am less than 5,000 miles frm the coveted gold status which would allow me to use the shorter security line. Anyway I am currently trying to think of anything that I know that I would spend money on anyway so I can spend it before December 31st. I don’t want to spend money just to spend it. That is not the point. I don’t want to waste money and go into debt for things I don’t need. I know that I am going to purchase tax software for about $60, groceries for $60, a heating pad for $35. I know this just sounds crazy but the Medallion miles are valuable.

Final Christmas Tally

I ended up exceeding my original Christmas budget of $500 and spent a total of $635. The additional spending related to a trip to Harry & David for two gift baskets. In retrospect I need to only buy one of them. I will know better next year. All in all I am not too disappointed with my Christmas spending because it was less than the most recent prior years. I did spend money on myself that I did not expect to spend, primarily the new TV for the bedroom. I guess I spent my tax refund a little early. I am still i the process of finalizing my 2008 budget and will post it later this week. I originally did not even budget for Christmas which is silly because I will spend money. Those are the type of spending categories that I need to be careful of in my budget. Here is the breakdown of where I spent my Christmas budget:

Wine Country Gift Baskets $50
Harry & David $123
Amazon.com $285
BestBuy $25
Barnes & Noble $32
Target $50
Pottery Barn $10
Cash $20
Nail World $40

Unwanted catalogs

There is a website that will let you unsubscribe from unwanted catalogs, Catalog Choice.org. Not only will it help save trees and energy by receiving fewer catalogs, but it will help curb any shopping temptations that the catalogs may bring. It takes just a few minutes to sign up and then you can go through a comprehensive listing of catalogs and decide which ones that you don’t want. What a great idea.

WAMU savings rate still at 4.75%

The Fed dropped interest rates last week by a quarter point but WAMU still has the same interest rate for its online savings account. ING Direct dropped its rate on savings accounts from 4.3% to 4.1% last week. I am glad that I moved my banking relationships to WAMU. I opened a $1,500 CD with WAMU last week just before the Fed dropped the rate just in case WAMU dropped its savings rate.

Flat screen TV

I succumbed to the temptation to buy a new TV. I bought a Sharp 19 inch flat screen DVD combo. I don’t really need one but I have been eyeing them for a while. I do feel a bit guilty about it but I looked at BestBuy.com today and noticed that the price for the same tv this week is $50 more and the regular price is $100 more than I paid. That takes a little guilt away. I do need to buckle down again after the new year and focus on my savings.

Disability insurance

I heard somewhere that the biggest asset anyone has is their ability to earn a living. That is why I purchase long term disability insurance through my employer that will pay me 66 2/3% of my pre-disability income and then purchase another $2,000 per month policy for $252 a year. I usually get a refund of about $80 a year on the outside policy so it really only costs about $172. I have never been on disability (not even short term) but being single and having only myself to rely on…I got to take care of myself. I wonder how many people out there purchase such insurance? To me it is worth the peice of mind it brings. I would have income of about $7,800 per month until retirement age if anything were to happen to me. That doesn’t include any possible social security disability income that I could be eligible for.

Update on Christmas budget

We are a little over two weeks from Christmas and I am well on track to stay within my $500 Christmas budget. I really wish I could just donate to worthy causes in my family’s name but I tried that one year and certain people got mad. Kind of silly isn’t it. I actually don’t want gifts myself…I would be happy if other people would donate in my name. I think next year I will bring up the donation idea earlier to see if it flies. There are so many kid’s in this country who have parents that either cannot get their act together or have had some bad luck and without the kindness of others they would not get anything for Christmas. I donated to The Empty Stocking Fund this year and I know it will go to a good cause if it doesn’t get stolen. I say that because they had about $50,000 of gifts stolen from their warehouse this year. I hope they catch who ever did it!

Budgeting for Christmas

This year I am trying to stick to a $500 budget for all of my Christmas shopping. I recently read that spending 1.5% of your income is a reasonable amount (if you can do it without going in to debt). For me 1.5%would be over $1,500. That is more than I want to spend this year given my desire to get out of debt. Anyway, I would have to take on additional debt to spend that money because I don’t want to take it out of my savings.
Most of my shopping gets done online and I have been very good about taking advantage of the various free shipping offers. So far I have not paid any shipping charges :) I really like how Amazon.com ships for free if you spend more than $50. I think that is very reasonable. Last year according to my Quicken records I spent $1,247 plus another $950 or so for a combination Christmas and birthday gift for my dad. I bought him a flat screen TV. I just hope that I did not set up any unrealistic expectations for his gift this year.

Turbo Tax vs. Tax Cut

I am starting to think about purchasing tax software again. Last year I used Tax Cut because it was a little less expensive when I included the state return and electronic filing. I have read a few reviews comparing Turbo Tax and Tax Cut and Turbo Tax seems to be the better program. I had used Turbo Tax for years and when I switched to Tax Cut last year I did not notice any major differences. Both programs let me import directly from Quicken so the biggest difference for me was the price. That will probably be the same for me ths year. I am hoping to get at least a $5,000 refund from my federal taxes and $1,000 from my state taxes. That will allow me to pay off my credit card and have some left over for saving. I usually file as soon as I can, typically the first week or so of February. I have found that I can get my refund within 10 days or so by filing early.

$25 in found money!

I received a notice in the mail yesterday about a lawsuit that alleges that Visa, Mastercard, and Diners Club credit cards conspired to set and conceal their fees for making foreign currency transactions between February 1, 1996 and November 8, 2006. At first I almost threw it away because I was thinking that I was not eligible for the minimum $25 settlement, but then I remember that I did travel out of the country during that time period and use a credit card. I submitted my claim online. The deadline is May 30, 2008 so I probably won’t see the money before then. I will keep my fingers crossed.

Update on WAMU ATM card

I am getting spotty customer service at the WAMU branches. I never received my ATM PIN in the mail as I was supposed to so early last week I called customer service. I was told that I could go in to a branch and they could provide me with a PIN. On Friday I went to a branch and despite how understanding and nice the people were about my PIN situation I was told that they would have to order me a new one to be mailed to me. I left and drove to another branch location and was greeted by someone eager to help me resolve the issue. He promptly inspected my ID and left me run my ATM card thru a machine whereby I could choose a PIN. Problem solved. I do not understand why the first branch could not have done that.

November net worth update

The stock market was not kind to my net worth in November, down more than $3,200. My home equity balance increased a little more in November beacuse I paid my December 2nd mortgage payment in November. My liabilities decreased $1,124 primarily because I made my December car payment in November. I hope to see an increase in December’s numbers.