I have missed interacting with you and reading your positive stories. It has been a long time since I was able to write here.
Last month, after waiting five excruciating months, we were only able to refinance our house, take out some equity and pay off some high interest credit card payments. We saved some for a rainy day, as my wife and I thought there is no point paying off all of our debt if it means the next time something happens we go straight back into debt. We have still have lower interest debt but continue our plan for becoming cash flow positive and increasing our savings.
Next week I am giving a speech at Toastmasters on great ways to save money. I would love to hear your favorite ways to save more money in the comments below. One of my favorite’s is automatically saving 1% of every paycheck, and increasing it slowly as time permits. It gets you into the habit of saving and I love it.
Two things of note. The market has been crazy lately. Make sure to stick with your plan. Emotions are running very high. We may not be at a bottom just yet but we are getting close. Please read this blog post from Armstrong Economics.
Down & Dirty for the Dow? Feb. or March Low?
Considering we closed right in between the weekly bearish levels I plan to play heavy defense next week and a slight bit of offense to take advantage of any upcoming declines. From my experience the last two months, caution is highly advised. For my 401ks, our current allocation is 65% cash, 35% stocks, and going forward for new money it is 90% stocks, 10% cash. The only reason is I want to buy at these lower prices, even though I have no idea how low we go or for how long they will last. I know the market will rebound over the longer term and I can sell at higher prices.
Second, Ask Socrates is now available from Armstrong Economics. I had mentioned it before. This is a computer system that monitors the world. I have signed up for the service as we need an unbiased third party with a great track record to help in these turbulent times. I find it a great help. Just click through to see the features that are coming on the main page.
Thanks everyone and enjoy your weekend!
Vijay @ Smilingdad 😊
Picture courtesy of Stockcharts.com. This is a weekly picture of the Dow Jones over the last five years, along with a 200 week and 400 week moving averages.
3 thoughts on “A lot has changed, but are things really different?”
For me the best way to save money is to pay myself first. We use our venture rewards credit card for everything. I tweak what we spend against our budget. Halt the use if we go over our spend limit. That way we never go over our total budget. I pay off my credit card every month.
Thank you for your comment. You provided some good tips for me to think about. How often do you budget and how much do you pay yourself first? We get paid bi-weekly and every two weeks I allocate where the money goes. My wife and I find it is easier to stay disciplined with cash. One thing we are working on is setting aside money to pay for recurring items on our credit cards. At the moment we are carrying card balances and have a three to six month goal to pay off balances in full.
I make sure we write down every purchase just like a checkbook. We pay ourselves first our whole amount we are supposed to save after we do our budget every month. That way, we always have the correct amount actually saved. Then at the end of the month I make the credit card bill. I watch my budget like a hawk because with 2 spenders and 4 kids, it’s easy to get out of control.