Economic Meltdown

It's been a few months since my last post. Been busy working towards that cool mill. We've got a long way to go. Our investment accounts are down about 25% for the year. Our credit card debt is up to $8k. Cash flow has been tight as I've had a number of patrons depart my service. This is the normal slow time of year but the problems of the greater economy have definitely had an effect.

The project we're working on is still going, with an expected product release at the beginning of next year. Should break even on $ within one year and then provide between $5 to 20k per year, discounting my sweat equity.

Still rolling over the CCs

We had to roll over ~$5,000 on our credit cards again this month as cash flow is still tight. The finance charge was $36. Bummer.

It is amazing how things can creep up and all of a sudden you are behind the eight ball. I really don't like doing it but at least there's a light at the end of the tunnel. May was a tough cash flow month for my business. Fortunately the end of June will see enough cash coming in to wipe out the debt and put away a few dollars towards my IRA.

Then I'll have to finance some capital asset purchases for my project, but that's a separate analysis.

In other news, our retirement accounts brushed up against the $100,000 mark the other day. So we're doing all right there.

Blast!

For the first time in several years, we've needed to roll over a balance on our credit cards. The variable nature of my income coupled with our unplanned tax issues resulted in a cash crunch. June and July should be much better from a cash flow perspective. Wifey continues to put 700 per month into her 403b, $100 goes into Vanguard Wellington, and $50 in the Duke DRIP.

I will need to take on some extra work to make sure I can fund my IRA later this year while still developing our project.

The food and gas inflation is definitely hitting us - probably $150-200 more per month over a year ago.

Tax hits

The tax man reduced our cash savings from nearly 12k to 4k this month. Between 2007 taxes owed and quarterly 2008 taxes it has put the squeeze on us, which is never fun. I was dead broke for several years in my twenties and will work three jobs before that happens again. Fortunately May is a quiet travel month, which should reset us a bit.

We are 'trying' to save additional capital for a house purchase towards the end of this year or the beginning of next year. Since we decided this we've amassed exactly zero towards this goal due to a variety of expenses and poor spending habits.

I am also going to be investing 5-10k in a product launch this summer. Unfortunately I don't have a reliable method of predicting the return on this product at the moment. That's something I'm working on.

Stock market

So the stock market has been going wild lately. The wife and I don't do any day trading so it doesn't affect our strategy at the moment. I recently invested more into RPF (Cohen and Steers Premium Income Realty Fund). Managed to buy in at a very low point ($14.20) and it's now back up to $16.60. Pure dumb luck / dollar cost averaging. The dividend on this is $0.16 per share per month.

2007 tax report

The tax results are in - we took a $5k hit due to underpaying throughout the year on my consulting business. Fortunately we have enough liquidity to handle this without undue stress. Scratch the end of year vacation though. Everything else goes well.

Our strategies

Our strategies for saving/growing our wealth:
max out wife retirement plan and my IRA - ride out the market for long term growth.
Save additional $1,000 per month for a bigger home (the next two years will be great for home buyers)
Grow my consulting business (work more/smarter)
Create a niche product for future passive income growth (henceforth called Project D).