Shedding Those Pesky Zeros from Bank Acct. Balance

The title of my post is pretty much how I feel these days. I'm due to write up my quarterly net worth statement and I am less than excited to do so. This is the first quarter I will have lost money in years. Cést la vie I suppose. Not like I've been doing much saving on my own to make up for my market losses. I feel like if the market is going to wipe out all of my savings, I might as well have some fun with what $ I do have! Next quarter should be better, because as of October 1, I have paid all of my social security tax for the year. That means an automatic raise of several hundred dollars during Q4. And we are inching towards bonus time (thank the gods).

I feel I have made some progress on fighting back the other force of evil trying to suck $ from me, the IRS. I put together a kick ass package for my audit, and there is no reason that I should not be receiving a check for overpayment from the IRS. I actually discovered that I double reported my dividends for the year in question, so I should get back a few hundred dollars. If they do not accept my business expense explication I will so appeal that finding. There is no reason for them not to, but with the government coffers running low I'm sure they are tasked with sucking every last penny they can from the populace. I'm going to fight for my rights and not let them intimidate me.

More Ugh

I have been having a bit of a pity party for the last week, ever since I came home to a big fat package from the IRS saying that they were looking at my 2008 tax return. This is highly annoying because the reason they say they are looking at my return is absolutely ridiculous and totally does not apply to my situation (they think I have been paid by a foreign embassy). But, in the process I am now going to have to defend my deductions (it's really just one big one) and there is the chance that I could lose. In which case I could have to pay interest in addition to the tax owed, and who knows maybe even penalties for good measure. Not to mention the annoyance of having to gather all of the paperwork required for this. And consulting an accountant who is VERY expensive. This whole ordeal could cost me $5k or god forbid more. Which on top of the 15K or so I have lost in the market eats up a lot of my savings for I guess the last two quarters or so.

I feel so wronged by the financial gods. I save, I invest, I plan and then the market dives, the banks don't pay any interest and now the IRS is harping on me.

Well, if I do end up paying a big tax bill, I will simply have to scale back. I was contemplating another trip in November, so I'll kill that idea. I was also thinking about having a cosmetic procedure done (judge away, I don't mind -- it's non-invasive and totally unneccesary but I want it). You know -- that whole stimulating the economy thing. But if the IRS wants to claw back my $, then the US government will have to find another consumer to do some shopping.

More Ugh

My taxable account has reached an unpleasant low today. The balance hasn't been this low since October of 2010. So almost a year of growth wiped out in a week or so. This market really requires a stomach of iron.

One thing that hasn't crashed and seems to be moving along nicely is my Lending Club account. Making me think I should invest more in there and lower my stock positions even more. I'm already like 60/40 investments/cash. Maybe I'll start taking more of the investment money and put it into loans. I like the idea of investing in people.

O-M-G

Everything was moving along nicely. My balances kept increasing. My savings were paying off. We all know what happened to that story this week. Ugh. I've lost on paper about 20K. Which is better than the start of the week when it was more like 30K. Of course, I'll just be patient and wait it out and hope that my balances reach what they were in July again at some point. I'm just getting tired of waiting. My taxable account is filled with index funds that I bought in 2003. I'm starting to doubt the buy and hold strategy. It's been 8 years, and I don't feel like there's any consistent growth. There are some points when the market is high, but I don't have a lot of confidence that this money will consistently keep growing. I'm tiring of hearing the financial advisers dole out advice to buy and hold. I am a disciplined, patient investor. I would never sell when low. But I'm starting to think of putting parameters in place. Stop losses and gains. So that my shares automatically sell when they've risen a certain amount. 10%? 15% Of course that incurs transaction fees and then there is the challenge of trying to find places to put the money once I sell. We'll see.

I had such confidence that I would finish the year (pre-bonus) with a net worth of 400K. I got complacent, forgetting the market can nose dive at any minute and wipe out months if not longer of growth.

Cash Money$

As I mentioned, I have a fairly large cash position. While the financial planner made me feel less guilty about not having it invested (he told me there will be volatility soon so it's ok to have a lot of cash on hand), I did want to earn something on it. Again from Get Rich Slowly readers, I learned about the Ally 5k-year CD. The best part about it is you only lose 2 months of interest if you pull your money early. I opened one big one, and now I plan to open several smaller ones. Opening several smaller ones is helpful because if I do have to pull some money, I'll lose less interest. That was another idea from a blog commenter. Yay for learning from others!

Know Your Stuff

I have been going through the process of cataloging my possessions for a while now. I read about a great tool in the comments on Get Rich Slowly. It's a website called knowyourstuff.org It's great. It gives you a place to catalog and document (with receipts, images) your stuff. Obviously this will be great in the case of a fire or another catastrophe. I entered most of my stuff and even looked up the original prices from my credit card records for a lot of them. Like my wardrobe, a lot of my furniture is hand me downs, including:
My Television
My coffee table and side table
My kitchen table
My bookcase
My lamp (my mom bought it for me when I was young)

Except for my fancy bedroom furniture that I bought last year, the rest of it is mostly Ikea or of equal cost and quality. I do like most of it, so it doesn't really bother me. My couch is too big for my living room, but it is soooo comfy I refuse to give it up. At least not yet.

Money Stress

I don't normally feel stressed about money. Mostly because I have designed my life's expenses to be way lower than my income. So I have a big cushion every month. This month that's not the case. I have so many obligations -- birthdays, weddings, etc. that I am spending a lot of money. I think it is bothering me because I feel like it is out of my control. Not that I resent my friends for the money I've spent, but I feel like I should be making cuts in other areas to compensate and I am finding that very hard to do. This is making me feel more empathy for those people who don't have a large cushion and feel like their expenses pile up each month out of control. Of course, in reality, I do have control. I don't have to attend all of these weddings and birthday parties. Or I don't have to be so generous with my gifts. But the fact if that I want to do these things, so I just have to give myself permission to spend more this month, and not stress about it because these are one time events. Here's to a more frugal (hopefully) August.