Jason Moran
Wednesday, May 21, 2008
  My Dog Sadie Growing Up
Sadie Fergalicious is nine or ten months old now, so she's about as big as she'll get. The pictures start in mid-October and continue until her newest picture at the bottom. The other dog that looks like her is Trinket, which is Sadie's sister who is owned by my sister Kelly.

Tuesday, May 13, 2008
  Adventures In Wealth Building
The goal is to be able to retire someday without caring whether social security pays me a dime.

You get there basically by increasing your net worth to the point that you can support your lifestyle via stuff you've saved. Net worth is basically this: Take everything you owe anybody (debt) as a negative. Next take everything you have (cash, 401K, IRA, house, cars, giant bars of gold, etc) as a positive (asset). Put those together and you'll have your net worth.

It's very common for a recent college graduate to have a large negative net worth. To increase it, you have to keep paying off debt while trying to gain less new debt while adding to your assets. I signed up at Net Worth IQ to help me track it over time.

I'm happy to say that I made the switch from negative net worth to the positive side in early 2008. I still have $25K of the $36K of college debt left, and I have a huge amount of mortgage debt - which sucks because I owe more on my house than it is even worth now that homes dropped in value. However, I've been stashing money in a Roth IRA, regular IRA, and a 401K. Plus, I just paid off all of my credit cards and I paid off both of my cars as of last month (I used that tax rebate everybody got to make the final payment!).

I just made it into the positive - so I have a long way to go. I hope to be on track by the time my early 30s hit. Check out this formula to see if you are on track:
AGE: Your current age (you can use decimals to be more exact)
$$: Your annual spending. This is not what you make, this also should not include most of your debt (like student loans). This is today's dollar amount that you spend on living or want to spend (food, travel, clothing, property taxes, car payments). Basically the things you'll be paying when you're an old geezer.

Target NET WORTH = (AGE/166 - 0.15) * AGE * $$

That is what your net worth should be today...based on this semi-common premise: "You will need 20 times what you annually spend to retire at 72".

I'm way behind...where are you at?

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