April 10 Net Worth:

Another great month even though we didn't see a huge amount of growth. We didn't see the stock market do it normal routine of going straight up daily. Still pushing through and hoping we don't hit a bumpy road with the stock market and wedding expenses.
Lets break it down:

Cash & Savings: This month we took a bit of a hit, mostly because purchases of stocks. I am not sure we will see much growth here the next couple of months, the wedding expenses are starting to add up, and do not see it stopping for the next couple months. This money grows from money directly transferred from paycheck to my money market. I do not see this money unless I have a big emergency. It is the money that we are saving for a downpayment on a house.
This bracket holds the funds for insurance, auto maintenance, Roth IRA, and vacation. This is why it can be a little deceiving, it also holds my monthly budget in it. It has about 13-15k sitting around as savings the rest are funds that are going to be used at some point over the year. The rest is used on a daily bases for covering expenses, rent, food, auto, etc...

Stocks/Brokerage: My stocks seem to perform well for me this month as gold is moving up everyday. With gold movement it is making all the mining and etfs I have go up as well. One of the best performing miner that I hold right now is Eldorado Gold Corp. (EGO) I am really happy with the purchase of this and wish I would have bought more. One of the stocks I have on my watch list is Silver Wheaton Corp (SLW) which some think is easily worth $30/share. As of right now I am holding back and hopefully save up some cash. The list of stocks I own (GLD)(SLV)(EGO)(AUY)(AVARF)(RGLD)(ZQK)(XOM)(CVX).

*As you can see I am heavy in commodities in my brokerage account. This is all based on my thought that over the next decade the best investments are going to actually be in hard assets. My Roth/IRA/401k are in pretty common index funds and mutual funds so I figure I can go more risky with brokerage. I believe these will out perform equities in the next decade and if nothing else I feel more comfortable with my portfolio diverse. I am bearish on the US Dollar and US Economy, I believe that trillion dollar deficits are not going bode well for the USA.

Retirement 401k: This braket is just me adding money to my 401k every month. Saw a nice little jump this month with the stock market. I'm not really checking on this bracket(daily/weekly) as it really long term and I just keep pumping money into it every paycheck.

Retirement IRA's: Slow growth here this month. I still think the market is going to correct itself. I will keep cash on the sidelines and just try and max out my fiancés and my Roth's next year. In this bracket I have all Vanguard Funds (VTSMX, VGSTX, VEIEX)

Debts and Liabilities - Vehicle under 10K!! Credit Cards done...

Credit Cards: This is just a more wedding stuff purchased with credit (Wedding outfit), it will be paid off before I am charged - I pay off any Credit Card debt monthly.

Car Loan: I am paying 4% APR on it so I am paying a little, but not a ton. Still looking to pay it off early-will probably be a goal this or next year. We are still saving up for a house so not sure its in our best interest to get rid of our cash sitting to be debt free on my vehicle.

April is now in the bank, I am still extremely bearish on the world economy and the US economy...We are headed for a financial storm and it is very important for all of us to be up to date on current events. It time to be prepared for the worse and pray for the best. I will be saving as much as I can but with the wedding I am going to be running low on cash flow. We will see how it all plays out here...

Thoughts from Chumbawamba

Here is some thoughts from (Chumbawamba) poster over at Zerohedge.com:

In a nutshell (because my education took years, so you can't expect me to give you the important background to my argument in one posting, or even several) this system is f*cked. Our debt-to-GDP ration is well beyond what other empires experienced just before their collapse. Our central bank is monetizing thin air to pay off the financial blackholes created by unregulated/out-of-control over-the-counter derivatives that are valued at well over $600 trillion globally, and our government is planning to borrow every last unit of currency under the moon in order to keep from falling into a fiscal abyss. How the hell does anyone expect this is going to turn out anything but very, very badly?

There are now literally tens of trillions of dollars of liabilities stretching from here on decades into the future. Our debt-based monetary system means these liabilities will only increase in cost and interest as time goes on. From where are the revenues going to come? The pace of productivity and wealth creation in this nation will have to inflate accordingly. How is this going to be accomplished? Do you have any answers? Does anyone?

We took a quantum leap from billions to trillions--a thousand-fold increase--in our economic discourse. It follows then that our GDP will have track this increase to keep up with the new normal. Again, from where are the revenues going to come? Are they going to be conjured up again like magic, so that we go from trillions to quadrillions as the new new normal? Or are you going to be expected to magically increase your productive output 1000 times to make up the difference, along with every other American (including children 1 and older, since we’ll also be needing more manpower for the job, way more than we have even if you include the illegals)?

WHO IS GOING TO PAY FOR ALL OF THIS?

The answer never comes. Oh yeah, this is simple to solve, they say. They'll just "add liquidity" to the market, then "drain it", as if this was just a matter of doing the dishes, and all the complaining and fussing and fearing and loathing and hemming and hawing was all just a matter of no one wanting to pony up to the sink to actually do the deed. But no, that’s just a cheap distraction. So the question remains:

WHO IS GOING TO PAY FOR ALL OF THIS?

I’ll tell you who: Us. As in you. And I. Or at least those of us that are silly enough to file and pay taxes (I don't know about you two, but I do not submit to extortion, otherwise known by the letters I-R-S). And how many people like me do you think there are now? Probably just a relative few. We're the "out there" nutballs. We're the ones that make wild-eye predictions of economic collapse and social chaos to follow. We're the ones who get pooh-poohed. Until the government keeps pulling shit like this. Then we grow in numbers. The disgusted; the disenfranchised; the disaffected. We find each other, learn from each other, and spread the wisdom. We watch as the government creeps upon our God-given freedoms like a depraved predator, one after the other, picking them off until one day we’ll be left naked and defenseless. But we prepare, and in the meantime we keep introducing new people to the mouth of the rabbit hole. And if you’re courageous, and intelligent, you’ll go in. And the deeper down the rabbit hole you go, the more you realize that real money—gold and silver—is the answer.

As more people discover the answer, the dollar takes one step closer to irrelevancy. Once it reaches that point, you have hyperinflation. Once the dollar enters hyperinflation the game is over; or rather, it just begins. But then that's a matter of perspective :)

Will the dollar cross that line of confidence? After all of my study, I sincerely believe it will and am convinced beyond a shadow of doubt about that conviction. I’ve been waiting for someone to come along and explain how I’m wrong about this. Despite my rhetoric, my eyes and mind are open. Convince me. Anyone?

In short: follow Austrian school of economics. I'm not saying they have ALL the answers, but so far it seems they have pretty damn nearly all of them.

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Ask yourself these questions:

1) What system is collapsing? The one in the US? I.E. the dollar?

1a) If the dollar collapses, what does that mean domestically?

1b) What does it mean internationally?

2) Is the FDIC solvent?

2a) If not, how safe are your bank accounts?

3) Are the firms in which you have your various retirement accounts solvent?

3a) Really? Are you sure? Did you check their balance sheet?

3b) Including all their hidden liabilities?

3c) If not, how safe are you accounts with them?

4) Does America strike you as a financially strong country?

4a) If not, do you think America will remain the world's sole superpower indefinitely under these conditions?

4b) If not, what does that mean for the dollar, the world's reserve currency, and the unit of account upon which all other world currencies (except gold) are based (again, domestically and internationally)?

Mull that over.

But here's a spoiler. The answer to all the above is:

Don't wait until inflation eats away your savings. Every day you wait is like an ounce of silver slipping out of your hands, lost forever.

History is your teacher. All others are substitutes. Including me.

I am Chumbawamba.

This might seem extreme, but he does ask some tough questions...cannot say I disagree and yes I tend to ignore what he says but doesn't mean that I don't feel this way down deep within my beliefs.

Governments hands in our 401(k)s?

After reading this article in the Wall Street Journal about major changes that are going to probably be coming down the road on 401k's has got me completely freaked out.  I also remember reading a article about this in Money mag on how our 401k's need to be revisited and revamped. I feel the government has its hand in to much of our personal lives as is, stay out of my retirement. I already have fears about some of the decisions being made in Washington that are going to come back hurt my pocket one day, but let's just stick to the subject. 

Some of the highlights from the article are:

"In another proposed change, President Obama's 2010 budget calls for the future establishment of a program in which all workers would be automatically enrolled in employers' retirement plans. Now, in most cases, they must opt in to participate. Also under the administration's plan, employers that don't offer a retirement plan would be required to enroll their employees in a direct-deposit individual retirement account. Employees would be able to opt out of either approach."

I could be wrong but don't we already have a plan like this, that is currently bankrupt, called social security? The only difference I see is the option to opt out? I think a easier solution would be to allow us to opt out of SS now. I would be up for opting out of SS, because I am 100% sure that I could take the 6.20% that I give every pay check and invest in something I would actually see one day. 

Goes on to say:

"The 401(k) has become the primary savings vehicle for 60% of workers but has been under scrutiny as workers lost $2 trillion in the market downturns, including traditional pension plans."

Look I agree that there should be some scrutiny behind a 401k. The individual needs to look at the plan and I don't think the government needs to have a hand in any part of my retirement or investments. They were not saying that when people were making money at 8-12% year? Everyone should have learned with Enron that you should be diversified and not have everything all in one company. I am willing to take a strong look at my 401k plan and determine personally, what I need, to make sure I have a nice egg for retirement. If someone decides not to participate in a 401k, they can just save or invest in other areas they seem fit. My grandfather never had a 401k, what he had was a saving account, and he saved enough money that he could retire and play golf everyday. 

I believe that this is what will happen if the government has their way

"Ed Ferrigno, of the Profit Sharing/401(k) Council of America, an industry group, said one fear is that more regulatory requirements will increase costs, and thus reduce services, for workers."

This is what happens when the government has there hands in the people's business. We don't need anyone to tell us what we should be doing with my hard earned money. What we need is for everyone to learn and understand that they need to save money for retirement. Whether they want to take the risk in the stock market or in other means of saving/investing is each individuals right as an American.

The one part of the article I like, talks about more tax incentives for workers and employers who participate in plans, but that should be the case now. Right now 401k's are deferring current income taxes, but the more incentives individuals and employers have, the more people would be willing to learn about the best options. If the government doesn't stop spending, the tax rate for my generation will be through the roof because of the deficit. They need to have more incentives like the Roth 401k which allows you to contribute with after-tax dollars and once you hit retirement age (59-1/2) you can begin to withdraw the money tax-free.

My whole fear in the government having a role in this matter, is that they don't have a very good track record with money, they seem to waste a lot. The government also seem to make decisions based on what crisis is going on, take this conversation for an example. For the most part they make changes that are the most popular one at the time or at these turning points. Our 401ks are individuals savings/retirement accounts and if the government has their hand in it, who is to say that they will not, if there is a national emergency, take that money from us and use it as they seem fit? That might be an extreme, but its to make a point...at the end of the day we don't need a nanny state. This seem again like the government is swooping in to bail us out? Please leave me out of this one as I am not counting on anything from the government when I retire, I can take care of myself.

I know this is probably a touchy subject but I really am very interested in hearing your thoughts on this. Is it a good thing, or are we playing with fire(retirement)?

401k vs Roth IRA - Round 2

So today I finally looked into what my best option was for either putting money into my company 401k or Roth IRA. I went and did some research on my companies HR site and found out that they are only matching up to 5% and not monthly but at the end of the year.

I'm not sure they will match until later but dont want to miss out if they decide to this year. I am currently putting in 8%, so this knock-down drag out fight still looks to be a draw. I dropped my contributions back to 5% and hopefully the company will match at the end of the year. In the meantime I will put the extra 3% in with my monthly contributions to my Roth. At the end of the day I still think this is the best decision and hopefully this will get me closer to my 2009 goal of maxing out my Roth. I also have my fingers crossed that the economy will turn around and will get my 5% matched come years end.

The showdown 401k vs Roth IRA?

Recently my company cut back on matching my 401k while the economy is upside down. I feel like I am at a bout (temporarily) with investing in my retirement…which one of these is the strongest investment at this current time.

Currently I am putting around 8% of my pay check into my 401k which is actually not losing money at the moment. It will come out to about $6160.08 at the end of the year. This money is also pre-taxed and by making pre-tax contributions, I am lowering my current taxable income.

With my Roth IRA which is after tax contributions, I am currently putting away $200.00/month = $2400.00/year with the limit on the Roth capped at $5000.00.

I am trying to figure out which should win this round? Maybe cut back 2% on my 401k which would put an additional $1540.00 in my Roth for a total of $3940.00/year and making my 401k total to $4620.00/year.

I know once my company starts matching again that I will bump it back up. During the meantime do I add more to my Roth or keep everything where it's at? I will keep you posted I need to do some more research. Please leave feedback!