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Archive for April, 2008

Lord of the Rings and Personal Finance

April 30th, 2008 at 01:32 pm

Lord of the Rings and personal finance may not seem like they have a lot in common at first. You might be wondering, "What analogy could this guy possibly draw?" Is the Ring of Power similar to debt (something that you may want to use for good but is ultimately corrupting)? Are Orcs similar to the barbarians and pirates that assail people who do not use Capital One credit cards? Maybe, but it's not quite as exciting as all of that.

When I think of Lord of the Rings, one thing sticks out in my mind above all else: Frodo and Sam endlessly plodding toward Mordor. This long leg of the journey that Frodo and Sam take has many themes intertwined: friendship, bravery, cowardice, and many others. In terms of personal finance, however, I think of the dogged progress that they ever so slowly make.

2008 has been a year of plodding progress for me. I faithfully shovel money in my 401k and Roth IRA. I throw 20% of my income in my savings account. Furthermore, I budget and keep track of my money.

I am happy with the progress that I am making, but it is odd at times to think of the huge amount of time it takes pay down debts and save up money. That's what makes me think of Sam and Frodo's journey.

I think J.R.R. Tolkien was telling us something by having the little Hobbits from the Shire actually take the Ring to the heart of Mount Doom. He could have cooked up some hero or another, but he choose Sam and Frodo. I think that all of us have a corrupting Ring to destroy. For some of us, it's debt. For others, addiction to drugs, violence, or whatever else.

Like Sam and Frodo, we all need help along the way. We need the help and joy that comes from being in community with other people on the same path. I think that Saving Advice helps a bit with the community aspect. However, I hope all of you have several Sams in your lives to help you out along the way.

Safe Travels...

Save Money: Fix Your Own Car

April 24th, 2008 at 04:29 am

I briefly mentioned my '98 Mercury Sable in yesterday's entry. It currently has 120,000 miles on it, and my goal is to get it to at least 200,000. Since Q and I lovingly refer to it as the Stingray, it's extra important that it continues to run.

Well, I quickly discovered that I was going to need to learn more about fixing cars for it to be cost-effective to keep the Stingray until 200,000. What really put me over the edge was when my wiper-motor linkage went out (The wiper-motor linkage is found, in most vehicles, right below the windshield. It's a very small motor and an assembly of bars that force both wiper blades to move when the motor moves one of them.). The dealership was going to charge me more than $200 for parts and labor.

I have never been particularly fascinated with mechanical things. I appreciate and respect engines, computers, other technological; however, I've always been more interested in language. While that has been good in many ways (the ladies love it), the downside is that I don't know a lot about fixing cars.

Anyway, to make a long story short, I have been learning a lot about fixing cars by trying to work on my car myself instead of immediately taking it to the dealership or to a garage. Also, I have been saving lots of money, and I think the Stingray just might make it to 200,000 miles.

Still Rollin'

April 23rd, 2008 at 10:49 am

Well, I haven't made an entry on here in a while. I'm still plugging away at my emergency fund ($6500 currently with the goal of $10000).

I opened a Roth IRA through T. Rowe Price last month. I am now putting 5% of my income in my 401k and 5% in the Roth. I'm gradually going to move toward funding only the Roth and let the 401k funding go to virtually nothing because I don't get a company match.

My 1998 Mercury Sable is still serving me well. I have had to learn a bit about fixing cars in the process, but that's just an extra perk.

Ok, I need to go for now.