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Archive for September, 2012

Getting Started on Taxes

I know this isn’t the typical tax season, but it is for me.  For the past several years, I have gotten an automatic extension so that I don’t have to file until October 15th.  Since I will be leaving the country toward the end of September, I have a self imposed deadline to get all the information to the accountant before I leave, which means that I will be working to get all the information and data together in the evenings this week.

I already have most of the information gathered from the rental real estate.  Now I have to get some stuff together related to the usual 1040 stuff.  I would say I am about halfway done and will be hitting it quite hard tonight.

I don’t necessarily like to procrastinate, but it did become a necessity a few years back and I haven’t been able to fully recover yet, but that issue should get resolved this year.

I certainly don’t enjoy having to spend so much time putting all the information together in a format that is easy for my accountant to work with, but the effort is definitely worth it.

Communication and Knowledge is Important

Even though I have an accountant fill out all the forms and prepare my taxes, I learned several years back that it is important to know the tax code (as best as it can be known by any individual) and to communicate your situation effectively.  It is also important to have a  rough idea of what you might owe and why.

After getting my taxes back one year, I was surprised to see that I owed more that what I thought I should given my circumstances.  It turns out that the accountant had forgotten about a special circumstance that entitled my wife and I to more deductions than was actually figured into the numbers.  We ended up sending in an amended return.

Also, we had one year where we were hit with a failure to file penalty which was absolutely not true.  We had an extension which had been filed appropriately.  A simple call to the accountant resolved this issue, but had I not paid close attention, the outcome may not have been pleasant.  Again, knowing what I should owe has helped with some of these human errors.

Fortunately, my situation hasn’t changed much over the past several years, so it is easy to know what to expect.  Also, I try to read a lot about taxes and know what is changing from year to year.  I am concerned about the potential impact of the fiscal cliff as a result of changes in the tax code and on government spending and have been trying to pay off debt knowing that we might be entering another recession.

I doubt many of you have been focused on taxes this month, but what are your thoughts on the fiscal cliff.  Doing anything to prepare?


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4 comments - What do you think?  Posted by Cash Flow Mantra - September 24, 2012 at 9:31 am

Categories: Taxes   Tags: , , , , ,

Net Worth is Up Over 18 Percent

I had to prepare a personal financial statement again for the bank that holds the loan on the commercial building that I own with a partner.  Actually the bank owns it, and we are simply making payments to eventually acquire full ownership.  I am not sure why they are wanting the information so soon since I completed this exercise at the end of May.  Although I suppose it could have actually been for a different bank at the time since I have had several requests for the information from various banks for various reasons.

This is the only time that I bother to go through this exercise since it takes a few hours to get all the information together.  That is time that I would rather be spending doing something else.  But the good news is that from May 28, 2012 to September 2, 2012, my net worth increased by 18.5%.  I was really rather shocked since it had only been a little over three months.  The previous increase had been 28% over 6 months which I thought might have been an anomaly so I was only expecting maybe 6% at best.

Looking At the Numbers

When I look at the numbers, I realize that the increase in net worth has come from two primary reasons.

First, my total retirement account assets have increased.  I have continued to save the maximum even though cash flow can be tight at times.  I have always believed in paying myself first even though I have trouble doing that with net income at this point.  I also receive a match so there is no way I would be passing up free money.

Second, I have been contributing more to the commercial loan than my partner so I now own a greater percentage of the commercial building and have been benefiting from the decreased mortgage balance on that and a few rental properties.  I now have more equity in the real estate than I did in May so each payment that is made will simply continue to increase my net worth.

While it is nice to see net worth increasing, it does little to help the monthly cash flow and will not pay off any major debts that are coming due.  Unfortunately, I will have to make some tough choices in the months ahead.  I suspect that things will be getting better, but it may take to the end of 2013 before I see some major results.

At least it is good to see things headed in the right direction.  I have a plan and a suspicion that the plan may just work.

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4 comments - What do you think?  Posted by Cash Flow Mantra - September 12, 2012 at 10:00 am

Categories: Investing   Tags: , , , , , ,

You Tube Saved Me $100 or More

There is a lot of good information on the internet along with a lot of bad.  You have to somewhat discerning and figure out what might apply to your situation, but if you can do so, the internet holds a wealth of information that can allow you to do amazing things.  There is information on how to retire early, how to invest in stocks and bonds and real estate and futures, how to start a blog, how to start a business, along with a ton of other financial information.

It turns out that my son came home late the other evening from practice and locked his keys in the car.  He states that they fell out of his pocket as he was getting out.  Ordinarily, this wouldn’t be a big problem other than the fact that when we went looking for the spare on the hook, it wasn’t there.  A frantic search of all the possible locations it might be failed to locate the extra key to the car.  We were facing a rather grand dilemma at 10:30 on a Friday night.  His equipment for the tennis match in the morning was locked in the car along with his homework for the weekend.  We had to find a way into the vehicle.

Internet Research

Enter the internet!  A quick search of car locksmiths revealed that it would likely cost at least $100 to have one come out close to 11 pm on a Friday night in the rain to unlock the car door in order to retrieve the set of keys.  So I decided to see if there might be a DIY way to break into the car.

I found a great You Tube video that seemed promising on how to break into a car with a tennis ball.  Looks interesting.  How does this really work?  Wait a minute.  It says the video is a fake!  On to the next one which looked promising.  It was titled, “A Method How to Unlock Your Car in 10 Seconds.”  Sounds too good to be true.

But I watched the video and it seemed quite real.  You can check it out for yourself — Watch the video.

I showed my wife and we decided to try it.  It was quite dark outside and I had a black shoelace against black interior so my wife held an umbrella and flashlight app on her cell phone so I could see what I was doing.  The hardest part was getting the knot past the door and into the car with a decent size loop intact.  The first time I got the loop around the lock, it slipped off.  But the second time, it snugged tight and I was able to unlock the car.

It took me about 10 minutes, mainly trying to get the knot and loop into the car.  I often pulled the loop out sliding it past the door.  But once I got it in there with a decent loop, I was able to get it on the third try.  It was quite satisfying to say the least.  I showed the video to my son and explained what we did.  Hopefully, he has learned to keep the keys in his hand before locking the door, but if not, at least he has an idea how to unlock a car door with a shoelace.


Here are some carnivals I have been in recently:

Lifestyle Carnival #18 – PT

The Wealth Artisan FinCon  – CFM

Carnival of Money Pros – CFM, PT

Carnival of Retirement #35  – GPM, PT
Thanks for reading.  Hope you have a good week.



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8 comments - What do you think?  Posted by Cash Flow Mantra - September 10, 2012 at 8:09 am

Categories: Saving   Tags: , , , , ,

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