Category Archives: Uncategorized

I’ve Moved Yo’

After some thought and a lot of help from Andrea @ Curiosity Killed the Blog, I’ve moved to my own domain.  That’s right, I now own a website.  Come on over and visit the new site here.  The site isn’t 100% done, so feel free to leave some feedback on the looks/layout.  I look forward to it.


401k’s and 5k’s

So this post really has nothing to do with 401k’s.  I just lack a major quality of being a good writer, that quality some people call creativity.  Figured I would just throw that out there incase you didn’t notice already. 

This post is dedicated to all things running.  All part of the bucket list.

I want to run a full marathon-  This will take a while, especially right now seeing as I have been lacking motivation to exercise.  It’s also not going to get any easier as every year passes.  The thing that sucks most about it, is that I used to be a pretty damn good runner.  I just wish I had the motivation that I had when I was in basic training.  Every morning we would wake up at 4am, go out and stretch and do exercises.  I thought it sucked at the time, but as I look back now I realize it wasn’t so bad.  Back in basic they would split you into different groups, based on what your 1 mile time was during reception week.  I’m not exactly sure what my time was (it was back in 2003) but I think it was around 7 minutes.  I was placed in A group with the “fast” runners. 

During the 9 weeks of basic training, our drill sergeants would push us, even when we thought we couldn’t go any farther or any faster.  They pushed us, motivated us and demanded that we run harder.  Each day as this went on it got easier and easier.  We were in pretty good shape by the time our first PT test came.  I ran my first 2 mile test in 13min and 36 seconds.  That would turn out to be the worst time of all my tests.  By the time we finished basic I had dropped it to under 12 minutes.  Our drill sergeants still pushed us, demanding we try harder.  After basic came AIT (job training).  Our last 2 mile was my best.  It was a simple course, a straight 1 mile track, turn around and run back.  They had a timer where you turned around and when I got there I couldn’t believe my time.  On my 2 mile pace I ran the first mile in 5 minutes flat.  I was thrilled, even during high school I had never broke the 6 minute barrier.  My total time when I finished was 10 min and 54 seconds.  I finished 4th out of the 180+ we had in our company. 

So why do I write about 2 mile tests when a marathon is 26 miles.  Because this is going to be my motivation, to try to get back into that shape.  I know at times during basic we ran 10+ miles and I wasn’t tired at the end of it.  I also know that 26 is a whole other ball game.  There is the physical challenges of running a marathon, but there will also be the mental challenges.  Some say the mental aspect is just as hard.  Before I train for a marathon, there are a couple other runs that I would like to do, runs that the wife is also interested in. 

I want to complete the Tough Mudder–  This is a race/obstacle course that was designed by the British Special Forces.  Not only is the race itself awesome, they also raise money to support the Wounded Warrior Project.  Something that I truly believe in and am very passionate about as my wife can attest to, is that I love all things military.  This race is normally 10-12 miles long, depending on location, and has obstacles along the way.  The obstacles include crawling under barbwire through mud, wall climbs, a 15 ft jump into water, climbing across netting and ropes, running through fire, running through mud in a maze of trenches, running while carrying a log, a slip-n-slide (not as hardcore lol), jumping into ice water, log jumping, climbing over a giant hay-bale pyramid, about 30 feet of monkey bars (some of which are greased) and last but not least, running through a bunch of wires, some of which are electrified with 10,000 volts.  I have no idea why I want to do this, probably because I like to test myself, and to prove that I can do it.  The race itself relies heavily on teamwork, helping others through the obstacles, but the top 5% of people who finish are invited to the World’s Toughest Mudder, which is a 24 hour race, whoever completes the most laps wins.  The ultimate goal of mine would be to finish in the top 5% and run the final.  The next race is one that the wife wants to do together.

We want to Run For Our Lives  We want to do this race purely on our love for the tv show The Walking Dead.  I don’t know if you watch it, but you should check it out.  It’s a pretty awesome show.  This race is a 5k obstacle course.  It has some basic obstacles in it but with a twist.  You have to wear a belt and on the belt are 3 flags which are your health flags.  In order to be considered a “survivor” you have to complete the race, and do all the obstacles with at least 1 flag left when you cross the finish line.  There are a bunch of people dressed up as zombies throughout the course who try to take your flags.  I don’t know about you but this sounds like it could be a blast.  We ran a 5k obstacle course together last year and had tons of fun, I think this could be even better.  We’re just not sure if we are going to do it this year or wait until next year.  It kind of sucks because the dates for the zombie one coincide with MX races I want to do. 

Do you like to challenge yourself?  What motivates you to get into shape?


aROTHaclypse Now, or Later

Today the PF blogosphere will start a movement to educate people on the awesomeness that is the Roth IRA.  This movement, led by Jeff Rose over at Good Financial Cents, the peeps that run RothIRA.com, IRA Market and 140+ other bloggers like myself want you to know how sweet a Roth IRA can be.  The following article is one of the reasons why I think you should open a Roth IRA. 

I like to read about all types of investment accounts, from college savings plans (I don’t even have kids yet), to IRA’s, 401k’s and individual accounts.  When I was researching where to open a Roth IRA I came across an article explaining some benefits of IRA’s, both Traditional and Roth’s.  One of the side benefits of Roth IRA’s is that You Can Use Roth IRA Contributions to Buy Your First Home!!!!   There are some strict conditions to this, but it can be a good way to save for retirement and a home at the same time. 

I’m not saying this would be a good idea for everybody.  This doesn’t make as much sense  to me if a person in their 40’s and 50’s were to do this.  Withdrawing such a large amount this late in the game could reduce your earnings potential to a point where it wouldn’t make it financially beneficial for you to do so.  I suppose it depends also on how much you have in your account and how much time you have left until retirement.  Being later in the game it could make a dent in your retirement plans.  I do however think that if a person was in their 20’s or early 30’s and they decide to do this it could be an awesome way to kill two birds with one stone. 

I will try to explain it in a simple way.  The first requirement is that you have to be a “First-time Homebuyer.”  Does that mean that because you have owned a home in the past that you are disqualified for this?  Nope.  To be qualified as a “First-time Homebuyer” you couldn’t have owned a house during the past two years.   A second requirement is that you must use the money to buy or build a home within 120 days of the withdrawal. 

You can do this with both a Traditional IRA (tax deferred and pre-tax contributions) and a Roth IRA (tax-free and after-tax contributions).  There are more limits going the Traditional route than going with the Roth.  The biggest limit is that you can only withdraw $10k penalty free over your lifetime from a Traditional IRA to build or purchase a home.  This can be done by your spouse also.  The other problem that runs with the Traditional is that the withdrawal will be taxed, because your contributions are pre-tax dollars.  To me that pretty much knocks that option off the table.  Lets take a look at the Roth IRA option. 

With a Roth IRA you can withdraw your contributions at any point in time (penalty and tax-free) if you need them.  The key word here is Contributions, not the money you hopefully made from your investments.  As of today a person under the age of 50 can contribute a maximum of $5k into a Roth IRA each year.  Say you maxed out your contributions each year for 10 years, you would have contributed $50k into your Roth.  You are able to pull that money (your contributions) out for any reason because it was all after tax money.  You can also withdraw up to $10k more (which would be drawing from your earnings, assuming you had earnings) but this also has stipulations to it.  One being that the account had to have been open for 5 years or more from the date of your first contribution.  If you meet this requirement the $10k would be tax and penalty free.   If the account has been open for less than 5 years, you can still withdraw the extra $10k without the early 10% distribution tax, but the $10k would be taxed at your current tax rate.  The extra $10k is a lifetime limit per person and once you have used that limit up its done.  For an account that has been open for 10 years (maxed-out contributions) you would be able to withdraw a total of $60k ($50k in contributions and $10k of earnings) tax and penalty free.  Your spouse could also do this with his/her Roth IRA, so if both of you have been maxing out your Roth IRA contributions there is potential to have $120k towards building or purchasing your first home. 

If after 10 years you decide that owning a home is not what you want to do, then you have an awesome start to a retirement account.  If you decide you want to use a Roth IRA as a home purchase account and withdraw money later on for that reason, you still have whatever you earned in those 10 years in your Roth IRA, with plenty of time to make up for the money you are withdrawing for a home purchase. 

I don’t know about you, but I hate seeing how much of my mortgage payment goes towards interest and not the principle.  The point of this for those that decide to use Roth contributions towards purchasing a home, is that you could potentially save a boatload of money on interest by sacrificing some of your early earnings potential in your retirement account.  If you do this by age 30, you still have 30 years left to make up for it.   You should take account of what the interest rates are at and what your returns are in your Roth.  It might not make financial sense to do this when interest rates are so low.  Unless you really hate debt like I do.  I purchased my home before I got into investing, not saying that we wouldn’t have bought our home if we would have known about this option, but it would have given us something to think about.   Either way, contributing to a Roth is a win-win for you.

What do you think, could this be a good tool to use for the younger generation to save for a home? 

P.S. I am not at all a tax or real estate professional.  This is just my observations and understanding from what I’ve researched.  You should always consult with a tax professional and your investment manager prior to making decisions like this.  Information in this article was found here specifically pages 51 and 62.  Always research and read the fine print before making your decision. 


Weekly Bucket

Here goes the second post to my weekly series of stuff I want to do/experience/accomplish in my lifetime.  So in keeping with the same idea of the last post, this one will be in the same category of adrenaline rushes. 

I want to Jump out of a Plane

A lot of people might think this is a stupid idea.  My dad always asks me, “Why would you want to jump out of a perfectly good airplane?”  My answer to his question is always, “Why would you not want to?”  From snowboarding, to  racing motocross, I have loved doing jumps, and having the feeling of weightlessness.  It’s a pure adrenaline rush. 

I’m not saying that I am fearless when it comes to any of this stuff.  That would be a lie.  Some motocross jumps scare me, especially ones like this (start at :12).  The adrenaline rush on those is crazy.  I am not afraid of the heights part of it, its more the landing than anything.  So skydiving would not be a problem for me, it only takes a split second to make the decision to make the leap.  The part that would scare me is the parachute not opening, which is pretty rare, even then you still have a backup parachute. 

I am trying to get the wife to do this with me.  I think it would be an awesome experience for both of us.  Not sure if I can get her on board though.  If not I have a couple of buddies that would also like to go, so it wouldn’t be by myself.  I’m thinking it would be way easier to do with friends to motivate me (or shame me into doing it). 

Am I crazy for wanting to skydive?  Has anyone experienced this and if so how was it?


Bucket List

I wanted to start a random weekly series that is fun and had nothing  (well, a little bit) to do with personal finance.  The first idea that came to my mind was the bucket list (also I stole this from Making Sense of Cents).  Everything that I include in the list I am very passionate about and is a dream of mine to accomplish/experience.   These will be in no particular order, just whatever I feel like writing about at that time.   So here goes the first one, and the winner is……………….

 

Backflip my Dirt bike:     I used to snowboard quite a bit during my teenage years.  After the first year I started to do jumps, and eventually attempted my first backflip.  It took me probably 30 tries until I finally landed it.  That feeling was incredible. 

Ever since I started racing  motocross and jumping (about 6 years ago), I’ve always loved the feeling of being in the air.  I’m nowhere even close to being awesome at jumping, I still crash quite a bit.  There are some jumps that I’m pretty scared of also.  I really love uphill jumps, and tabletops.  Not a huge fan of jumps that have a gap before the landing.  Landing short can hurt pretty bad.  I’ve always watched freestyle MX, like the X-games.  One of my favorite riders is Travis Pastrana, a guy known for pushing the sport to new limits, like landing the first double-backflip on a dirt bike. 

One other rider that I admire goes by the name of Scott Murray (if you click on that link, make sure to have your volume turned down).  He is relatively new to the freestyle world, best known for being the first privateer (non-sponsered) rider to be invited to the X-games.  He drove out there in an ambulance that was converted to haul his bikes.  He attempted the double backflip but under-rotated a little bit and crashed.  Since then he has landed it and now travels the world doing what he loves.  

Last year Scott started a little amateur competition at his freestyle park.  On the friday he teaches how to jump ramps, starting real close to the landing and then moves it out farther once you get used to the speed that is needed.  Saturday is the friendly competition.  I couldn’t get the days off from work last year to go to this and was kind of bummed out.  I emailed him the other day to ask if he was doing it again this year.  His answer was yes, and that it was on June 16th.  I checked my schedule and was super excited when I found out I had that weekend off.  Frickin sweet!!!! So I’m not sure if we will be using his foam pit to jump into at first.  And I’m not sure if he will even allow it being from such a beginner.  But it is one step closer to crossing this off the ole’ bucket list.  Here’s to hoping.  Even if it doesn’t work out, I still get to hang around not only a professional freestyle MX rider, but just an all around good guy. 


No Time

This weekend was a busy one, mostly just doing some spring cleaning and getting the house ready for todays appraisal.  So I didn’t have much time to blog.  Hopefully the time we spent will be worth it though and our refinance gets approved. 

I’m really excited about the rest of the year.  Motocross season is coming up and I need to get some new gear.   Hopefully I will be able to work overtime to pay for those things, really just a new helmet (previous one has been through many crashes) and a new pair of boots.  I should be able to get both for under $400.  The boots I will be able to get cheaper online, but I would like to buy the helmet local, kind of important to have a good fit.  It can get expensive but I love it and the wife is my biggest fan. 

The title of the post says “No Time”, which is something I always feel I am lacking.  It doesn’t matter what it is, I still always wish there was more time.  I am horrible at managing my time (the wife reminds me of this a lot), I need to get better at this and kind of start “budgeting” my time.  Allocating a set number of minutes/hours to what I do.  One thing I def have to start budgeting time towards is working out.  Motocross is physically intense and I am not even close to being in shape.  I tell myself every year that I’m going to get into MX shape, but I never do.  Maybe this will be the year.

Do you manage your time well?  Or are you like me and need to start budgeting time?


Epic Fail……….

We have been working on our refinance for about 6 months now.  It has been a very frustrating time for both my wife and I.  There hasn’t been a simple problem, only tough ones, ranging from not having the title to our house, to not enough comparable sales for our appraisal to be approved.  The former being something that we could handle and the latter being completely out of our control.  Along the way we have felt frustration, hope, more frustration, excitement and last but not least, failure.

Last Friday I called our mortgage officer.  Feb 27th was supposed to be our last day of the lock-in period.  I knew he was going to extend it by a week because we were waiting on one more sale to go through, and see if the underwriters would approve that sale as a comparable.  So last monday that sale closed, the one we were waiting on for the underwriters to approve our appraisal, which was the last step before closing.  The underwriters decided to decline that sale as a comparable.  Pretty much stopping our refinance from happening.

The refi is on the back-burner for now, so that leaves us with some options on other stuff.  We had money saved up about 9k to pay down our mortgage to get a VA loan, so now we have to decide what we want to do with that money.  Here are some options.

  • Still pay down the mortgage, about $8400 to get it down to the original appraisal’s 20% equity and get rid of PMI, saving $106/month plus the interest savings over the life of the loan.  This would also let us get a later refi without putting any more $ down.
  • Pay off the camper, about $7500, saving $236/month.
  • Pay off Student loan, about $3900, saving $70/month.
  • Keep the money in savings.
  • Buy a brand new motocross bike?

I think the best route to go here is to put it towards the mortgage.  Over the long run I think it’s the best option to go with.  We would still have the other loans, but the goal of paying those off by years end is still the goal considering we had earmarked that money for the mortgage pay down.  Our mortgage officer told us that another option for us is to wait until the more active selling season (summertime) is over, talk to some real estate agents and see how sales were with houses that are comparable to ours and then reapply for the refinance.  I think that by going with the 1st option, we would already have the mortgage paid down far enough to not put any extra down if we were able to refi in the fall.  The camper and student loan would still be there for a while but will still be paid off by years end.

As frustrating as this whole refinance has been, I am trying to take some good from it.

  • We have the title in our name now.
  • Our savings rate has increased by cutting back on other stuff.
  • We now have a plan to attack our debt.

Which option do you think is best and why?  Can you think of other options that I might have?