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Mid-May Update

May 15th, 2008 at 04:05 pm

That's great, it starts with an earthquake, birds and snakes, an aeroplane -
Lenny Bruce is not afraid. Eye of a hurricane, listen to yourself churn -
world serves its own needs, regardless of your own needs. Feed it up a knock,
speed, grunt no, strength no. Ladder structure clatter with fear of height,
down height. Wire in a fire, represent the seven games in a government for
hire and a combat site. Left her, wasn't coming in a hurry with the furies
breathing down your neck. Team by team reporters baffled, trump, tethered
crop. Look at that low plane! Fine then. Uh oh, overflow, population,
common group, but it'll do. Save yourself, serve yourself. World serves its
own needs, listen to your heart bleed. Tell me with the rapture and the
reverent in the right - right. You vitriolic, patriotic, slam, fight, bright
light, feeling pretty psyched.

It's the end of the world as we know it.
It's the end of the world as we know it.
It's the end of the world as we know it and I feel fine.

Thatís right. I feel fine.

Yep. My wake up to date started with an earthquake of 25k in medical debt last August. Then, I was listening to my inner voice just churn with self-doubt. Then, the fear of the height of my debt crept in. Then, I saved myself and served myself and it was the end of my old world as I knew it, but I feel fine.

During the first quarter of this year, mid month was always the apex of the stress for the month. Then last month, something happened. There wasnít any stress. This month, no stress.

Why? I had a plan at the being of the year. Itís basically the same plan I have this month. Itís because I have full faith in the plan. As they say ďPlan the work and work the plan.Ē

So now, I donít have to devote my mental energy to worry about the whether the plan will work or not. I can now start mapping out my next steps. My plan, which encompasses my goals, is pretty much mapped out for the rest of the year. I work the plan and I should get there.

This leaves me to start looking at what I want to do in 2009. What direction do I really want to go? And what are the main variables?

So whatís on the table for 2009?

Definite:
1) $15,500 to 401(k)
2) Contribute to 529s Ė total of $4,000
3) Max. 2008 IRA contributions

Now comes the harder goals. I need to explore if it is better for me to be a 1099 consultant or a W-2 consultant.

But the real big question is whether to stock up cash for real estate investment purchases or to pay down the mortgage. My thought process is that I am probably 2-3 years from purchasing my first investment property. I have a child that is 9 months and one that is 3.5 years old. At this juncture in my life, I really donít want to take time away from them. Also, I want to do tremendous research into the market and formulate a business plan. I also want to enter the market from a position of strength (good down payment, strong cash reserve, and time to devote to it).

I also would love to get my 30 year mortgage down to a 15 year.

So those are the three things rolling through my head right now. But I have time to think before 2009 gets here. Time at the moment is on my side.

7 Responses to “Mid-May Update”

  1. pjmama Says:

    haha. I love that song. Those of us in Akron Ohio have a certain appreciation for it.

  2. Broken Arrow Says:

    Hehe, life on the road of life is always better with traveling music.

    I also aim to max my 401(k) and Roth IRA each year... but beyond that, things are a bit hazier. Then again, I don't make enough to worry about this part yet. Big Grin I know I need a replacement car soon so that'll probably eat up whatever is left anyways.

    You probably know this already, but to me, going into real estate for investing is like operating a side business. In which case, I'd probably lean towards something more stable like W-2 consulting. That is, I'm assuming that you are also planning to take on renters until you can flip it for profit.

    Investment properties are too high cost of an entry for me though. At most, I'll probably do REITs, but I don't know what to think of REITs yet.... Probably a good idea to look into, say in another year or maybe two?

  3. ceejay74 Says:

    Wow, '09! I haven't even thought about it, beyond getting rid of the second half of my credit card debt. Too many job/school/refi variables up in the air right now.

    I have promised myself I can start trying to get pregnant once I get rid of the CC debt, so it's another great incentive to do it early (but will probably change the rest of my debt-payoff landscape a bit).

  4. merch Says:

    BA Ė Yea. Iím looking for the financials to recover. Once that happens, Iíll roll that into REITs. Probably about a year away.

    As for real estate, itís not something to go in with low funds. I pan on starting with one 3 family. It will probably got 200k. So, I would be looking at 45k to get in and then have an additional 30k sitting in the company account, just in case. That way I am going in strong and not desperate.

    You should think about a 2 family. Weíll have competing real estate empires in 15 years.



    Ceejay Ė My goals are pretty much set for the end of this year. So, Iím on autopilot now. Just keeping the pace. So, Iím trying to look ahead and make any small adjustments that I need to. Unfortunately, the USS Merch doesnít turn on a dime.

    Also, I wouldnít wait for children. My wife and I had to go through an egg donor for our second child. Just something to think about. Itís never the perfect time for kids.

  5. Broken Arrow Says:

    You should think about a 2 family. We%u2019ll have competing real estate empires in 15 years.

    Hahahaha! Something tells me you'll wipe the pants off with me, but hey, a little healthy competition never hurt anyone!

  6. NJDebbie Says:

    Bought a 2 family house in '98 real cheap. Managed to pay off the mortgage in '08. After taxes and insurance our net income is about $1600 a month. Smart move on our part. Go for the 2 or 3 family.Smile

  7. Petunia Says:

    Never did know the words to that song, except the last ones which I could actually understand.

    We're still pretty far from "planning the work and working the plan" but it's nice to know that when that day comes . . . my stress level is likely to go down. Smile Good work Merch, and thanks for continuing to inspire us.

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