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Made first Bid on a House

January 21st, 2011 at 05:59 am

They didn't accept the bid, but it was a good learning process.

The asking price was $65,000. The place needed a new roof, a slight upgrade in the electric, and a lot of cosmetic work. However, the structure was solid, we liked where it was, and we liked the house.

We offered $46,000, which is probably what it's actually worth. I proceeded to panic for two days because things like that stress me out.

We're pre-approved up to $65,000 on a 15-year fixed with 20% down, which means we can get something up to $80k give or take. We could definitely borrow more, but I have an obsessive fear of debt.

They countered at $60,900, which I took to mean that they weren't going to play ball, so we're letting it sit.

Buying a house is a bizarre process.

Major Update

January 13th, 2011 at 04:11 pm

I forgot all about this place until Saving Advice sent me a birthday greeting in my email! Nice marketing, guys! I seriously need to update everything here.

I have been very, very blessed since I made my last entry in here. Here's the scoop:

1. My wife and I have absolutely zero debt! Debt free!

2. We drive a paid-for 2006 Saturn Vue.

3. We have $18,250 in a savings account for a down payment on a house. We just looked at a really cute house that's selling for $65,000, which is around the price that we want.

4. We have $10,000 in an emergency fund in addition to our other savings.

5. My wife gets to be a stay-at-home dog mom.

6. We tithe 10% of our gross income to our church. I'm just telling you guys because you don't know who I am. Tithing has been so amazing. If you don't do it, I challenge you to do it for a year.

7. We're making plans for baby #1.

8. We are contributing about 12% of our gross income to retirement. One of our goals for 2011 is to raise that to 15%.

9. We do all of this on one teacher's salary.

10. God is good. Sometimes I get scared that things are too good to be true, but we just keep having faith and pushing through hard times as they come.

The Grand Plan: Part I

May 22nd, 2008 at 12:34 pm

I am getting married on May 31st. My fiancee and I are extremely excited, have known each other for a long time, have similar interests and values, and all of that other good stuff. One thing that I think is going to help us avoid a lot of fights is that we have similar values when it comes to money.

With that being said, I want to lay out our plan for the next five years to see what you all think. First, between the two of us, we have saved roughly $17,000 since we graduated from college. That is somewhere between nine months and a year of living expenses for us. With that safety net in place, we can proceed to debt.

In terms of debt, all we owe is for student loans. I currently have $9,200 and will only have a few thousand more to complete my M.A. I get a $4,000 raise when I complete my M.A., so we plan to throw all of that on to student loans until they are paid off. DF, soon to be DW, (If I understand correctly, DW means "Dear Wife"? Going on this assumption, DF is "Dear Fiancee.") is starting an M.A. in college administration, so that will ultimately throw $18,000 to $20,000 more in student loans on top of that.

Our plan is to live only on my salary and save all of DF/DW's salary. Assuming she makes somewhere around $30,000 each year, which is low-balling it, we could have $80,000-$100,000 saved up in five years.

If this does come to pass as planned, we have a couple options. The first option is to throw all of it on a house. The second option is to max out a Roth IRA and throw that rest on house. Beyond that, I don't really know. Any suggestions? Is this plan feasible?

State Budget Cuts = My Job in Danger

January 9th, 2008 at 04:40 pm

Well, Kentucky needs to balance its budget. That means education funding is about to be cut. Potential staff layoffs, hiring freezes, and other such wonderful things are on the horizon. Letters and memos have already been flooding through the state everywhere from community colleges, to state universities, to high schools: funding is being cut.

I pride myself on being an advocate of the free market. If a company can't compete, it shouldn't receive any help. The people who work in those careers should move on to more productive positions in the economy.

I may be faced with that now. The claim is art, business, home economics, and PE will be cut. Furthermore, I find it hard to believe that the 800+ students in my high school are going to receive English instruction unless there are the same number of English teachers as there are now. I guess I'm trying to say that I'm 70% sure that I'll have a teaching job this coming fall.

I don't like those odds one bit. Maybe I'm completely wrong. Maybe the last thing on anyone's mind is cutting English positions, but I'm the new guy. Other teachers there have houses and kids and tenure.

As I said before, I'm an advocate of the free market. I'll move on if I have to, but I'm not going to fib: it's going to hurt a bit.

This is why I save money. This is why I can't imagine living paycheck to paycheck. I currently have three month's living expenses saved up. With the three months of summer that I'll still have paychecks and insurance IF I don't have a job next year, that's at least six months of living expenses. I could feasibly have ten months in my emergency fund by the time next August rolls around.

It may seem like I'm blowing things out of proportion. I'm just saying that I see a storm coming, and I'm going to be caught right in the middle of it. I stand by my 70% chance of having the same teaching job next year. If I don't get rehired, I'll have plenty of money saved up. I'll easily find employment somewhere else.

Like I said, though, it's not going to be painless.

Wesabe

January 6th, 2008 at 01:01 pm

Does anyone here have experience with Wesabe?

Long-Term Financial Goals

December 22nd, 2007 at 06:57 am

Wow, thanks so much to everyone who posted on my first entry. It really means a lot to feel welcome right from the start.

I guess a good second entry might be to set some tentative financial goals. I'm open to any suggestions and feedback on these.

Goal #1: Have enough money in my 401k and Roth IRA to live on for the rest of my life when I retire.

Kentucky teachers draw a pension after they have taught for 27 years. The pension system is a pretty good deal; you draw 60% of your max salary for the rest of your life. If I stay in the classroom, I'll draw somewhere around $40,000 a year from my pension for the rest of my life. Now, that seems like a good deal, especially if you have a nice stash in your 401k and Roth IRA, but I know enough to know that I should NEVER bank on a pension system of other form of group benefits. Those things are at the mercy of politicians and other types who wield far more power than I do. I need to be prepared to financially stand on my own two feet when I need to retire.

Goal #2: Figure out how much money I will need in my 401k and Roth IRA to meet Goal #1.

Does anyone know how I can go about doing this?

Goal #3) Have absolutely no debt.

This is a really long-term financial goal for me because I have just started accumulating debt. I got through my undergrad without acquiring any debt, but I have had to start taking on some since I started my M.A. I am nursing a car that my parents gave me a long time ago, a 1997 Mercury Sable, so I'm going to need a new car within a year or two (I'm thinking of buying a certified, pre-owned Honda Civic). That will put me farther in debt. Then, I'd imagine that Q (let Q = my fiancee) and I will be looking for a house within five years or so. All of these things are not bad debt. Still, they are debt.

Many of you have much more experience with this stuff than I do; please let me know what you think. Offer suggestions because they are more than welcome.