Stacking Pennies . . .

After yesterday's post on being impatient to enroll in my company's 401k, today I found that I was finally "in the system" and could enroll! I eagerly got to the screen where I could indicate I wanted to save 15% of my pretax income. Then came the fund allocation screen....

Crap. I wasn't 100% prepared for this despite it being on my to-do list from about a week ago. I do have a loose plan of what I want to do, but haven't figure out how to align my three accounts into one asset allocation.

My overall goal for my asset allocation goal is as follows:

• Stocks/Bonds: 88%/12%
• Within stocks, Domestic/International: 60%/40%
• Within Domestic, Large Cap/Small Cap/REIT: 75%/15%/15%

I also would like 10% of my international allocations in emerging markets, and someday I may want to do something fancier with bonds as I hear a lot about TIPS and Treasury and things I don't know anything about (right now I just use a bond index fund).

Overall, this breaks down to 6 funds allocated as follows:

• Large Cap 37%
• Small Cap 8%
• REIT 8%
• Int. Index 32%
• Emerg. Mkts 4%
• Bond Idx 12%

Do you think I'm missing anything important?

There are some issues with this right now. It is pretty impossible for me to actually get the 4% emerging markets allocation or even the 8% REIT allocation. I don't have those options in my 401k, and Vanguard requires minimum investments of $3000, which is currently 15% of my portfolio. Besides, I don't really know exactly what my current allocation is, mostly because Fidelity's 2040 fund has about a zillion different holdings.

So, what is my plan? First, I need to move both my Roth IRA and old 401k to Vanguard, while rolling the 401k to an IRA. Then I want to roll $5000 of the 401k into the Roth. Why just $5000? Because I don't want to get hit with taxes on the full $15k this year. I figure I'll roll it into my Roth over a period of 2-3 years, hurrying it along if it becomes necessary (meaning, if I end up planning to get married before then, as the income limits are harder to meet if you aren't single). Perhaps more on the rollover later, as I contemplate all the implications of it.

Within the Roth, I want to buy $3000 of the REIT index fund, and put the rest in the Vangaurd 2040 fund (which does have a small percent emerging markets). I'll then set my future contributions to the 2040 fund and most likely put my old 401k into the 2040 fund as well. When my portfolio grows more, I may invest more into the emerging markets fund, but probably not any time in 2008.

Last I'll use the index funds in my 401k to balance out my other allocations (small cap, large cap, index, and bonds) as closely as I can to my goal.

What do you think? I do want to have real estate be part of my portfolio, as I don't own property and don't plan on it soon. Should I just wait on the REITs until I can keep them a smaller percent of the portfolio? Or, given the housing market, will they decline all on their own, so I won't have to worry?? :)

In a side note, I temporarily regretted posting anything about my relationship yesterday. People sometimes jump to conclusions based on limited information. I wrote a post detailing things, intending to "clear up" some things. It was wordy and not very personal finance related anyway, so I'll just say it in a concise fashion. It's been 3.5 years. When we were both students, we split things fairly evenly. He would never need a loan from me and is good with money, and will most likely be very successful (someday). He really is on a tight budget as we live in an expensive city. He does pay for things now and then, including dinners, just not this weekend. He spent hours helping me set up my furniture and hang pictures and is really helpful with that kind of thing. I eat his food when I'm at his place (but my food is so much better!) We discussed it briefly, he acknowledged it, and I'll see if it is an issue in the future. If so, I will write about it, but I have to remind myself not to get (too) defensive about the comments!

So, you aren't supposed to keep score in relationships. Still, I can't help it sometimes.

My boyfriend is a poor poor grad student who makes less than half of what I do (stipend). My savings is going up, his is staying flat at best. Naturally, I don't expect him to spend much on us. He is content with not going out to eat much and living quite cheaply, which is great for us in the long run because I'm fairly frugal too. We should never have problems living within our means. Still, sometimes I want treats, so I provide them for us.

This weekend (starting on Thursday) I paid for:
Pizza: $13, a good deal though, for 3 medium pizza's that fed us almost all weekend. I will say nothing about the healthfulness of it...
Sam Adam's White Ale: $14
Lunch at Ikea: $11 (though my fault, since we wouldn't have otherwise been at Ikea and he was helping me pick out and build stuff)
Random Food that we ate: Coffee, cereal, milk, juice, burritos from Trader Joe's.... Plus he made a smoothie that neither of us really needed/wanted (which was much to thick) with my frozen strawberries right before dinner for no logical reason!

Also, he doesn't have a car, so I'm always driving and using my gas. And he definitely ate/drank more of all that stuff than I did.

It isn't that I'm not generous with this kind of thing. I am actually quite generous: "Thanks for coming to Ikea... do you want to stop at the cafe? How about this Mango Sorbet too, that looks delicious!" Then I do my budget, see that I want to save more, then regret my generosity. Ooops.

Then again, how petty is it for me to quibble about $37 spent on "us" when i spent about $200 on me and my apartment at Ikea? It is hard to justify that.

I guess it's the principle rather than the dollar amount. When we stopped at the store to buy juice (potentially for future smoothies or to mix in drinks), he could have paid for it. It was only about $3, so it makes no difference in the scheme of things, but it makes me feel a little less like I'm being taken advantage of. I know that really isn't the case... I offer to do all these things and he would be fine if I stopped. Sometimes I can't help but be bothered by it though.

I guess I need to be careful with my generosity, and really think about it before I offer to pay for things for "us". I need to make sure I won't regret it. Spending money doesn't show love (though, I can't help but think it does, at least a little). I think (hope) that my attitude would be different if we were engaged/married and money spent on us was truly ours and not mine/his. I also think his attitude would be a little different as well. But it just isn't like that right now. It is my money, and if I'm going to share it, I need to make sure I'm sharing it within my budget.

My boyfriend randomly started up a personal finance conversation with me last night. He isn't that well informed (though he's good with money), so it was fun for me to share what I've learned from this personal finance blogosphere. Not that I mentioned my blog--it's private for now, though I wouldn't be horrified to share it with him.

One thing he came up with was a goal that we should try to have 150k saved up for a house in the next 3.5 years. Not that I do "SMART" goals (specific, measurable... acheiveable... see, I don't even know the acroynm), but I don't to dumb goals either. In fact, I invented a new acronym: Daft, Unattainable, Meaningless and Bogus! I asked if there was any math involved in coming up with that number, and he said no. He just took the date when he'd be done with grad school, pulled another number out of a hat, and said it would be a good goal for our house downpayment.

I did some quick math. Assuming I had to come up with 1/2 of that, I would have to save about $1800 a month. I could maybe do it, if I stopped saving for retirement! Besides, I'm not really all that keen on property ownership at this point in my life. I don't even know where I want to settle! I told him that we could discuss a goal like this if/when we are engaged, but for now, I'm sticking to my own goals. I'm willing to compromise, but not just on some whim of his!

Speaking of retirement, I would like to leave you with this depressing snapshot of my 401k. I'm sure glad I don't need this money for years!

I had three really close girl friends in high school. My senior year their was a fourth girl we spent a lot of time with as well. Of the five of us, I'm the ONLY ONE who is not currently married. I'm twenty-five, and the rest of them are about the same. Most have been married about a year, but one girl has been married almost 4 years already.

I've been with my boyfriend for about 3.5 years, and it isn't a real secret to many people that I had hoped to be engaged quite awhile ago. I'm not exactly "pushing for it" at this point (does that really work anyway?) but based on conversations we had in our relationship, I honestly thought it would have happened awhile ago. However, plans adjusted, and it seems like it'll happen eventually, but there isn't a rush right now. People around here don't always understand that. They think at 25, I'm a candidate for becoming an old maid. I'm willing to wait, at least for now. There certainly may come a time when waiting isn't the right thing for me anymore, but I don't know when that time is.

Oh, wait, is this personal finance blog? What is my point?

As much as I thought getting married ASAP would be ideal, there is something to be said for starting off a career on your own. I enjoy reading other young female bloggers, especially those who are also unmarried, and thinking how just a couple generations ago our lives would have been unthinkable. Though I admit I've had the emotional support of a relationship, I do rent my own apartment, pay my own bills, and really came into my own financially in a way that I simply wouldn't have had I been legally tied to another person. I'm sure we would have figured this stuff out together, but the whole financially independent thing is something I'm a little proud of myself for accomplishing. Independence in general is something I'm proud of.

Trent over at the The Simple Dollar recently wrote about how having a family and kids has totally changed his priorities in life. Being unmarried (when most of the people I know are married) has allowed me to keep my choices strictly my own. I'm not saying that I need to hold onto that forever, but I might as well enjoy this independence while I have it.

(Oh, and even though I'm all about frugality and practical purchases, I still want a diamond engagement ring. I simply can't help it. Do you agree?)

I think my parents are finally getting serious about their finances. It's long overdue (they are in their late 40s) but better now than in 10 or 20 more years. Or never.

To clarify, my mom has always been relatively good with her money. She was the one who paid the bills and took us clothes shopping. She rarely bought anything for herself (and conveniently, shared our clothes when we were in high school! The perks of being a petite woman with three girls!) and always worked hard. She has been good with money, but doesn't seem to branch too far from the basics of budgeting and getting things paid.

My dad has always been awful with money. He grew up in a very poor family and didn't learn anything about how to manage money. Things went alright for them when he worked for someone else. He'd get paid, turn the check into my mom, and she took care of the magic. It all fell apart when he went to business for himself. He worked hard enough, but it takes more than that to run a business. Let's just say that from the time I was about 16 until earlier this year, their finances were a bit of a disaster.

These days, my parents are doing something pretty neat since all of us kids are off on our own. My mom does travel nursing, and my dad (an electrician) finds work wherever they go. They take 3-6 month assignments in various cities in the US (mostly California, lately) and work. They are too young to retire, but they are able to see more of the world than they ever have before. I'm very proud that they took the initiative to do this, and they seem to really love it.

Anyway, for the first time in my life, my dad seems to be exceptionally careful with money. They have finally canceled their home phone line (they are there less than 6 months a year anyway!) and he announced to me that he was happy that that was saving him $30 a month. He also realized he was being charged a fee for his checking account, and promptly switched to a different version. Since they are traveling a lot, it doesn't make a lot of sense to buy "stuff", so they don't purchase a whole lot anymore. He also has been pestering me to get off of his car insurance plan once I get settled into Los Angeles. That'll save him several hundred dollars!

As much as I have loved having my car insurance paid, it is really a huge relief for me to hear them talking about saving money. Even if it costs me.

He's still not perfect--for Christmas he bought some overpriced remote controlled helicopters for a couple of his nephews, even though they are so obviously too young to be able to fly them. I bet they are broken by now. Still, he's made huge headway.

I've never read Dave Ramsey's "Total Money Makeover" book. I'm not the target audience for it, but my dad seems like he might be. It would be a little awkward for me to give it to him, and he is more of a magazine/newspaper guy than a book guy. Still, I'm going to keep my eyes out for a non-intrusive way to suggest it. I'm excited that they might live in the same city as me for one of their assignments. If my dad is actually receptive to this personal finance stuff, I might be able to sneak in a few other suggestions. Get a high yield savings account! Check your credit report for free! Have you considered a Roth IRA? Can I help?!?! Please!

Does anyone else find themselves more versed in personal finance than their parents? Have you ever made suggestions to them, or is it usually the other way around?

When I first graduated college, I knew very little about personal finance. I'd done a few smart things along the way, but wasn't even well versed on what I now consider the basics of personal finance. I knew enough to participate in my company's 401k and to consolidate my student loans, but I didn't consider a Roth IRA until I'd been out of school for over six months. I had an excellent credit score, but my asset allocation was completely out of whack.

I've been a huge NPR fan for years, and as I suddenly had paychecks coming in, I started listening to "Marketplace Money" on a weekly basis. From there, I found a the personal finance blogosphere, and the rest is history.

The very first personal finance task I tackled was my student loan debt. I had roughly 21k in federal subsidized Stafford loans, with another 6k in private loans. Since I had all this money coming in, I immediately started paying as much as possible on my private student loans. The interest rate was probably around 8%--nothing too terrible, but not a dream either. It felt so good to send them checks for $500 or $1000 and watch the balances decrease.

After the private loans were gone, I had a desire to tackle the federal loans. Despite the low interest rate, the balance really bothered me. I think part of it was influenced by my boyfriends mindset that all debt was bad. It took me months to convince him he really should get a credit card in order to build a credit history. It took me weeks to get him to move his money from a standard savings account to something that actually would pay him some interest. And though I have explained this to him more than once, I think it will take quite some time before I'm able to get him to understand that rushing to pay of my low interest loans at the expense of other goals is really not the best move.

As I've become more educated in personal finance, the student loan balance bothers me a lot less. In fact, it has dropped to the absolute bottom of my list of priorities. I still pay a little extra each month: Instead of the $133 due, I pay $175. This will shorten the life of the loan by about 8 years. I still plan to pay them off even more quickly than that, but I don't plan on accelerating them any more until bigger priorities are met: maxing out a 401k and a Roth, for example.

The reality is, most of my other personal finance goals would be out of reach if I had not borrowed that money to get an education. Each month when that money comes out of my account, I still think it was money well spent.

My boyfriend compliments me sometimes, saying that I'm good with money. He says that, but once or twice, he has added "but I'm better with it!"

I respectfully disagree with that sentiment. I'm better with money, he's just more stingy. Also, his stingyness comes primarily from the fact that he is a grad student and has a very limited disposable income. In general, he is selectively stingy. Back when he was making a reasonable income, he spent in the range of $3000 for private pilot flying lessons. So he spends less by buying cheap lunch meat and kraft singles, and I buy better stuff. I don't consider that being better with money, I consider that having more money and making choices, not being "worse" with money.

I think when we are married, we'll be able to manage our finances without too much conflict. We are both generally savers, but we are both (generally) willing to spend on certian things we value: for example, travel, occasional good meals, and wine. We should make decent money, and things should be smooth. And if they are not, we both are capable of cheap living.

I hope I get to be in charge of the budgeting and bill paying. I am a control freak and like that sort of thing, but he is a control freak as well. Of course, decision making will be together (which will be an adjustment after years of independence), but there has to be one executer.

I would like us both to be involved in our investment decisions. Since I already have a full time job and he is still in school, I'm a few years ahead of him in investment knowledge. Not that I'm an expert, but I'm at relatively comfortable with the basics. He does have a Roth IRA, but he opened it with a broker. Edward Jones, maybe? I'd need to let him know the virtues of target date funds, indexing, and low fees. Right now, he only has about 2-4k in there (I don't know the details), and I don't know the fees, so it isn't an issue. (Besides the fact we aren't even engaged!)

I think, over the next couple years (or until whenever it is we get married and what is "mine" officially becomes "ours") money might be a slight issue for us due to vast income disparity. If I want us to go out for dinner, I'm going to have to pay for it more often than not. He isn't gonig to demand to be taken out, but he doesn't have the funds to treat me too often. It is sort of something that I have accepted already over the last year and a half of me working and him being a student. It can be frusterating, especially when my my two closest friends from high school (who were students at the time) received coach purses for christmas last year from their signifcant others. I got a nice necklace, which is great, but it would be nice to be spoiled every now and then. Maybe he can spoil me in ways that don't involve spending money.

I spent the week surrounding New Years Eve with a friend I rarely see (we met on a study abroad semester), our boyfriends, and another friend of hers. With the exception of my boyfriend (still a grad student), everyone had just recently entered the working world.

One night, they wanted to go to a "fancy" restaurant for dinner one night, and my boyfriend and I politely declined but offered them the use of the car to go. They graciously offered to treat us, so we agreed to come along. The bf and I politely ordered relatively lower priced items (still probably $40 each), and the others ordered appetizers and dessert (though they were kind enough to share). Dinner for the five of us was about $350, maybe more. The food was decent, but didn't knock my socks off. The service was good, but not worth that kind of money to me at this point in my life.

Then there was the shopping. My jaw just about fell off when one girl stated that a $1000 handbag was "within the price range" she was looking for. I have no idea her salary (though I do think she lives with her parents, meaning, no rent, which helps), but it just seemed utterly unreasonable to pay that much for a handbag. Still, people do it. All the time. Just not many people that I know.

Sometimes it strikes me unfair when I see people my age spending on expensive items. In many cases, it is flat out unfair--their parents helped them through school and maybe even still subsidize their lifestyles, while mine didn't. Very few people are wealthy by their own doing at age 24. Many people are comfortable (myself included), but having enough wealth to live the high life? Not me.

Really, it doesn't matter if it is fair or not. Not one bit. All that matters is they are good people who don't make me feel bad about being more careful with my money. I do my best not to make them feel bad that they do spend more money.

I think when I move to Los Angeles, I'm going to run into this feeling a lot more than I do here in the Midwest. I'm extremely down to earth, and the L.A. stereotype isn't. I'm sure some won't fit the stereotype, but I'll surely meet a lot more people with piles of money than I know now. I'll also working at a big name company where many people went to top schools. I went to state school. You've never heard of my school. I was smart enough for a better school, but the finances just wouldn't have worked out. In some ways, it makes me proud of myself. I got to the same place as them, on my own, without a fancy school or lots of money. Even so, I wouldn't have minded if my parents paid for a top notch education. It wouldn't make me any less of a person.

Anyway,the girl who bought a Burberry towel (a towel? Why?) and a $250 watch (spur of the moment, out of spite!) suggests getting one coke at a pizza place and sharing the free refils. Too funny.

After yesterday's post on being impatient to enroll in my company's 401k, today I found that I was finally "in the system" and could enroll! I eagerly got to the screen where I could indicate I wanted to save 15% of my pretax income. Then came the fund allocation screen....

Crap. I wasn't 100% prepared for this despite it being on my to-do list from about a week ago. I do have a loose plan of what I want to do, but haven't figure out how to align my three accounts into one asset allocation.

My overall goal for my asset allocation goal is as follows:

• Stocks/Bonds: 88%/12%
• Within stocks, Domestic/International: 60%/40%
• Within Domestic, Large Cap/Small Cap/REIT: 75%/15%/15%

I also would like 10% of my international allocations in emerging markets, and someday I may want to do something fancier with bonds as I hear a lot about TIPS and Treasury and things I don't know anything about (right now I just use a bond index fund).

Overall, this breaks down to 6 funds allocated as follows:

• Large Cap 37%
• Small Cap 8%
• REIT 8%
• Int. Index 32%
• Emerg. Mkts 4%
• Bond Idx 12%

Do you think I'm missing anything important?

There are some issues with this right now. It is pretty impossible for me to actually get the 4% emerging markets allocation or even the 8% REIT allocation. I don't have those options in my 401k, and Vanguard requires minimum investments of $3000, which is currently 15% of my portfolio. Besides, I don't really know exactly what my current allocation is, mostly because Fidelity's 2040 fund has about a zillion different holdings.

So, what is my plan? First, I need to move both my Roth IRA and old 401k to Vanguard, while rolling the 401k to an IRA. Then I want to roll $5000 of the 401k into the Roth. Why just $5000? Because I don't want to get hit with taxes on the full $15k this year. I figure I'll roll it into my Roth over a period of 2-3 years, hurrying it along if it becomes necessary (meaning, if I end up planning to get married before then, as the income limits are harder to meet if you aren't single). Perhaps more on the rollover later, as I contemplate all the implications of it.

Within the Roth, I want to buy $3000 of the REIT index fund, and put the rest in the Vangaurd 2040 fund (which does have a small percent emerging markets). I'll then set my future contributions to the 2040 fund and most likely put my old 401k into the 2040 fund as well. When my portfolio grows more, I may invest more into the emerging markets fund, but probably not any time in 2008.

Last I'll use the index funds in my 401k to balance out my other allocations (small cap, large cap, index, and bonds) as closely as I can to my goal.

What do you think? I do want to have real estate be part of my portfolio, as I don't own property and don't plan on it soon. Should I just wait on the REITs until I can keep them a smaller percent of the portfolio? Or, given the housing market, will they decline all on their own, so I won't have to worry?? :)

In a side note, I temporarily regretted posting anything about my relationship yesterday. People sometimes jump to conclusions based on limited information. I wrote a post detailing things, intending to "clear up" some things. It was wordy and not very personal finance related anyway, so I'll just say it in a concise fashion. It's been 3.5 years. When we were both students, we split things fairly evenly. He would never need a loan from me and is good with money, and will most likely be very successful (someday). He really is on a tight budget as we live in an expensive city. He does pay for things now and then, including dinners, just not this weekend. He spent hours helping me set up my furniture and hang pictures and is really helpful with that kind of thing. I eat his food when I'm at his place (but my food is so much better!) We discussed it briefly, he acknowledged it, and I'll see if it is an issue in the future. If so, I will write about it, but I have to remind myself not to get (too) defensive about the comments!

So, you aren't supposed to keep score in relationships. Still, I can't help it sometimes.

My boyfriend is a poor poor grad student who makes less than half of what I do (stipend). My savings is going up, his is staying flat at best. Naturally, I don't expect him to spend much on us. He is content with not going out to eat much and living quite cheaply, which is great for us in the long run because I'm fairly frugal too. We should never have problems living within our means. Still, sometimes I want treats, so I provide them for us.

This weekend (starting on Thursday) I paid for:
Pizza: $13, a good deal though, for 3 medium pizza's that fed us almost all weekend. I will say nothing about the healthfulness of it...
Sam Adam's White Ale: $14
Lunch at Ikea: $11 (though my fault, since we wouldn't have otherwise been at Ikea and he was helping me pick out and build stuff)
Random Food that we ate: Coffee, cereal, milk, juice, burritos from Trader Joe's.... Plus he made a smoothie that neither of us really needed/wanted (which was much to thick) with my frozen strawberries right before dinner for no logical reason!

Also, he doesn't have a car, so I'm always driving and using my gas. And he definitely ate/drank more of all that stuff than I did.

It isn't that I'm not generous with this kind of thing. I am actually quite generous: "Thanks for coming to Ikea... do you want to stop at the cafe? How about this Mango Sorbet too, that looks delicious!" Then I do my budget, see that I want to save more, then regret my generosity. Ooops.

Then again, how petty is it for me to quibble about $37 spent on "us" when i spent about $200 on me and my apartment at Ikea? It is hard to justify that.

I guess it's the principle rather than the dollar amount. When we stopped at the store to buy juice (potentially for future smoothies or to mix in drinks), he could have paid for it. It was only about $3, so it makes no difference in the scheme of things, but it makes me feel a little less like I'm being taken advantage of. I know that really isn't the case... I offer to do all these things and he would be fine if I stopped. Sometimes I can't help but be bothered by it though.

I guess I need to be careful with my generosity, and really think about it before I offer to pay for things for "us". I need to make sure I won't regret it. Spending money doesn't show love (though, I can't help but think it does, at least a little). I think (hope) that my attitude would be different if we were engaged/married and money spent on us was truly ours and not mine/his. I also think his attitude would be a little different as well. But it just isn't like that right now. It is my money, and if I'm going to share it, I need to make sure I'm sharing it within my budget.

My boyfriend randomly started up a personal finance conversation with me last night. He isn't that well informed (though he's good with money), so it was fun for me to share what I've learned from this personal finance blogosphere. Not that I mentioned my blog--it's private for now, though I wouldn't be horrified to share it with him.

One thing he came up with was a goal that we should try to have 150k saved up for a house in the next 3.5 years. Not that I do "SMART" goals (specific, measurable... acheiveable... see, I don't even know the acroynm), but I don't to dumb goals either. In fact, I invented a new acronym: Daft, Unattainable, Meaningless and Bogus! I asked if there was any math involved in coming up with that number, and he said no. He just took the date when he'd be done with grad school, pulled another number out of a hat, and said it would be a good goal for our house downpayment.

I did some quick math. Assuming I had to come up with 1/2 of that, I would have to save about $1800 a month. I could maybe do it, if I stopped saving for retirement! Besides, I'm not really all that keen on property ownership at this point in my life. I don't even know where I want to settle! I told him that we could discuss a goal like this if/when we are engaged, but for now, I'm sticking to my own goals. I'm willing to compromise, but not just on some whim of his!

Speaking of retirement, I would like to leave you with this depressing snapshot of my 401k. I'm sure glad I don't need this money for years!

I had three really close girl friends in high school. My senior year their was a fourth girl we spent a lot of time with as well. Of the five of us, I'm the ONLY ONE who is not currently married. I'm twenty-five, and the rest of them are about the same. Most have been married about a year, but one girl has been married almost 4 years already.

I've been with my boyfriend for about 3.5 years, and it isn't a real secret to many people that I had hoped to be engaged quite awhile ago. I'm not exactly "pushing for it" at this point (does that really work anyway?) but based on conversations we had in our relationship, I honestly thought it would have happened awhile ago. However, plans adjusted, and it seems like it'll happen eventually, but there isn't a rush right now. People around here don't always understand that. They think at 25, I'm a candidate for becoming an old maid. I'm willing to wait, at least for now. There certainly may come a time when waiting isn't the right thing for me anymore, but I don't know when that time is.

Oh, wait, is this personal finance blog? What is my point?

As much as I thought getting married ASAP would be ideal, there is something to be said for starting off a career on your own. I enjoy reading other young female bloggers, especially those who are also unmarried, and thinking how just a couple generations ago our lives would have been unthinkable. Though I admit I've had the emotional support of a relationship, I do rent my own apartment, pay my own bills, and really came into my own financially in a way that I simply wouldn't have had I been legally tied to another person. I'm sure we would have figured this stuff out together, but the whole financially independent thing is something I'm a little proud of myself for accomplishing. Independence in general is something I'm proud of.

Trent over at the The Simple Dollar recently wrote about how having a family and kids has totally changed his priorities in life. Being unmarried (when most of the people I know are married) has allowed me to keep my choices strictly my own. I'm not saying that I need to hold onto that forever, but I might as well enjoy this independence while I have it.

(Oh, and even though I'm all about frugality and practical purchases, I still want a diamond engagement ring. I simply can't help it. Do you agree?)

I think my parents are finally getting serious about their finances. It's long overdue (they are in their late 40s) but better now than in 10 or 20 more years. Or never.

To clarify, my mom has always been relatively good with her money. She was the one who paid the bills and took us clothes shopping. She rarely bought anything for herself (and conveniently, shared our clothes when we were in high school! The perks of being a petite woman with three girls!) and always worked hard. She has been good with money, but doesn't seem to branch too far from the basics of budgeting and getting things paid.

My dad has always been awful with money. He grew up in a very poor family and didn't learn anything about how to manage money. Things went alright for them when he worked for someone else. He'd get paid, turn the check into my mom, and she took care of the magic. It all fell apart when he went to business for himself. He worked hard enough, but it takes more than that to run a business. Let's just say that from the time I was about 16 until earlier this year, their finances were a bit of a disaster.

These days, my parents are doing something pretty neat since all of us kids are off on our own. My mom does travel nursing, and my dad (an electrician) finds work wherever they go. They take 3-6 month assignments in various cities in the US (mostly California, lately) and work. They are too young to retire, but they are able to see more of the world than they ever have before. I'm very proud that they took the initiative to do this, and they seem to really love it.

Anyway, for the first time in my life, my dad seems to be exceptionally careful with money. They have finally canceled their home phone line (they are there less than 6 months a year anyway!) and he announced to me that he was happy that that was saving him $30 a month. He also realized he was being charged a fee for his checking account, and promptly switched to a different version. Since they are traveling a lot, it doesn't make a lot of sense to buy "stuff", so they don't purchase a whole lot anymore. He also has been pestering me to get off of his car insurance plan once I get settled into Los Angeles. That'll save him several hundred dollars!

As much as I have loved having my car insurance paid, it is really a huge relief for me to hear them talking about saving money. Even if it costs me.

He's still not perfect--for Christmas he bought some overpriced remote controlled helicopters for a couple of his nephews, even though they are so obviously too young to be able to fly them. I bet they are broken by now. Still, he's made huge headway.

I've never read Dave Ramsey's "Total Money Makeover" book. I'm not the target audience for it, but my dad seems like he might be. It would be a little awkward for me to give it to him, and he is more of a magazine/newspaper guy than a book guy. Still, I'm going to keep my eyes out for a non-intrusive way to suggest it. I'm excited that they might live in the same city as me for one of their assignments. If my dad is actually receptive to this personal finance stuff, I might be able to sneak in a few other suggestions. Get a high yield savings account! Check your credit report for free! Have you considered a Roth IRA? Can I help?!?! Please!

Does anyone else find themselves more versed in personal finance than their parents? Have you ever made suggestions to them, or is it usually the other way around?

When I first graduated college, I knew very little about personal finance. I'd done a few smart things along the way, but wasn't even well versed on what I now consider the basics of personal finance. I knew enough to participate in my company's 401k and to consolidate my student loans, but I didn't consider a Roth IRA until I'd been out of school for over six months. I had an excellent credit score, but my asset allocation was completely out of whack.

I've been a huge NPR fan for years, and as I suddenly had paychecks coming in, I started listening to "Marketplace Money" on a weekly basis. From there, I found a the personal finance blogosphere, and the rest is history.

The very first personal finance task I tackled was my student loan debt. I had roughly 21k in federal subsidized Stafford loans, with another 6k in private loans. Since I had all this money coming in, I immediately started paying as much as possible on my private student loans. The interest rate was probably around 8%--nothing too terrible, but not a dream either. It felt so good to send them checks for $500 or $1000 and watch the balances decrease.

After the private loans were gone, I had a desire to tackle the federal loans. Despite the low interest rate, the balance really bothered me. I think part of it was influenced by my boyfriends mindset that all debt was bad. It took me months to convince him he really should get a credit card in order to build a credit history. It took me weeks to get him to move his money from a standard savings account to something that actually would pay him some interest. And though I have explained this to him more than once, I think it will take quite some time before I'm able to get him to understand that rushing to pay of my low interest loans at the expense of other goals is really not the best move.

As I've become more educated in personal finance, the student loan balance bothers me a lot less. In fact, it has dropped to the absolute bottom of my list of priorities. I still pay a little extra each month: Instead of the $133 due, I pay $175. This will shorten the life of the loan by about 8 years. I still plan to pay them off even more quickly than that, but I don't plan on accelerating them any more until bigger priorities are met: maxing out a 401k and a Roth, for example.

The reality is, most of my other personal finance goals would be out of reach if I had not borrowed that money to get an education. Each month when that money comes out of my account, I still think it was money well spent.

My boyfriend compliments me sometimes, saying that I'm good with money. He says that, but once or twice, he has added "but I'm better with it!"

I respectfully disagree with that sentiment. I'm better with money, he's just more stingy. Also, his stingyness comes primarily from the fact that he is a grad student and has a very limited disposable income. In general, he is selectively stingy. Back when he was making a reasonable income, he spent in the range of $3000 for private pilot flying lessons. So he spends less by buying cheap lunch meat and kraft singles, and I buy better stuff. I don't consider that being better with money, I consider that having more money and making choices, not being "worse" with money.

I think when we are married, we'll be able to manage our finances without too much conflict. We are both generally savers, but we are both (generally) willing to spend on certian things we value: for example, travel, occasional good meals, and wine. We should make decent money, and things should be smooth. And if they are not, we both are capable of cheap living.

I hope I get to be in charge of the budgeting and bill paying. I am a control freak and like that sort of thing, but he is a control freak as well. Of course, decision making will be together (which will be an adjustment after years of independence), but there has to be one executer.

I would like us both to be involved in our investment decisions. Since I already have a full time job and he is still in school, I'm a few years ahead of him in investment knowledge. Not that I'm an expert, but I'm at relatively comfortable with the basics. He does have a Roth IRA, but he opened it with a broker. Edward Jones, maybe? I'd need to let him know the virtues of target date funds, indexing, and low fees. Right now, he only has about 2-4k in there (I don't know the details), and I don't know the fees, so it isn't an issue. (Besides the fact we aren't even engaged!)

I think, over the next couple years (or until whenever it is we get married and what is "mine" officially becomes "ours") money might be a slight issue for us due to vast income disparity. If I want us to go out for dinner, I'm going to have to pay for it more often than not. He isn't gonig to demand to be taken out, but he doesn't have the funds to treat me too often. It is sort of something that I have accepted already over the last year and a half of me working and him being a student. It can be frusterating, especially when my my two closest friends from high school (who were students at the time) received coach purses for christmas last year from their signifcant others. I got a nice necklace, which is great, but it would be nice to be spoiled every now and then. Maybe he can spoil me in ways that don't involve spending money.

I spent the week surrounding New Years Eve with a friend I rarely see (we met on a study abroad semester), our boyfriends, and another friend of hers. With the exception of my boyfriend (still a grad student), everyone had just recently entered the working world.

One night, they wanted to go to a "fancy" restaurant for dinner one night, and my boyfriend and I politely declined but offered them the use of the car to go. They graciously offered to treat us, so we agreed to come along. The bf and I politely ordered relatively lower priced items (still probably $40 each), and the others ordered appetizers and dessert (though they were kind enough to share). Dinner for the five of us was about $350, maybe more. The food was decent, but didn't knock my socks off. The service was good, but not worth that kind of money to me at this point in my life.

Then there was the shopping. My jaw just about fell off when one girl stated that a $1000 handbag was "within the price range" she was looking for. I have no idea her salary (though I do think she lives with her parents, meaning, no rent, which helps), but it just seemed utterly unreasonable to pay that much for a handbag. Still, people do it. All the time. Just not many people that I know.

Sometimes it strikes me unfair when I see people my age spending on expensive items. In many cases, it is flat out unfair--their parents helped them through school and maybe even still subsidize their lifestyles, while mine didn't. Very few people are wealthy by their own doing at age 24. Many people are comfortable (myself included), but having enough wealth to live the high life? Not me.

Really, it doesn't matter if it is fair or not. Not one bit. All that matters is they are good people who don't make me feel bad about being more careful with my money. I do my best not to make them feel bad that they do spend more money.

I think when I move to Los Angeles, I'm going to run into this feeling a lot more than I do here in the Midwest. I'm extremely down to earth, and the L.A. stereotype isn't. I'm sure some won't fit the stereotype, but I'll surely meet a lot more people with piles of money than I know now. I'll also working at a big name company where many people went to top schools. I went to state school. You've never heard of my school. I was smart enough for a better school, but the finances just wouldn't have worked out. In some ways, it makes me proud of myself. I got to the same place as them, on my own, without a fancy school or lots of money. Even so, I wouldn't have minded if my parents paid for a top notch education. It wouldn't make me any less of a person.

Anyway,the girl who bought a Burberry towel (a towel? Why?) and a $250 watch (spur of the moment, out of spite!) suggests getting one coke at a pizza place and sharing the free refils. Too funny.

After yesterday's post on being impatient to enroll in my company's 401k, today I found that I was finally "in the system" and could enroll! I eagerly got to the screen where I could indicate I wanted to save 15% of my pretax income. Then came the fund allocation screen....

Crap. I wasn't 100% prepared for this despite it being on my to-do list from about a week ago. I do have a loose plan of what I want to do, but haven't figure out how to align my three accounts into one asset allocation.

My overall goal for my asset allocation goal is as follows:

• Stocks/Bonds: 88%/12%
• Within stocks, Domestic/International: 60%/40%
• Within Domestic, Large Cap/Small Cap/REIT: 75%/15%/15%

I also would like 10% of my international allocations in emerging markets, and someday I may want to do something fancier with bonds as I hear a lot about TIPS and Treasury and things I don't know anything about (right now I just use a bond index fund).

Overall, this breaks down to 6 funds allocated as follows:

• Large Cap 37%
• Small Cap 8%
• REIT 8%
• Int. Index 32%
• Emerg. Mkts 4%
• Bond Idx 12%

Do you think I'm missing anything important?

There are some issues with this right now. It is pretty impossible for me to actually get the 4% emerging markets allocation or even the 8% REIT allocation. I don't have those options in my 401k, and Vanguard requires minimum investments of $3000, which is currently 15% of my portfolio. Besides, I don't really know exactly what my current allocation is, mostly because Fidelity's 2040 fund has about a zillion different holdings.

So, what is my plan? First, I need to move both my Roth IRA and old 401k to Vanguard, while rolling the 401k to an IRA. Then I want to roll $5000 of the 401k into the Roth. Why just $5000? Because I don't want to get hit with taxes on the full $15k this year. I figure I'll roll it into my Roth over a period of 2-3 years, hurrying it along if it becomes necessary (meaning, if I end up planning to get married before then, as the income limits are harder to meet if you aren't single). Perhaps more on the rollover later, as I contemplate all the implications of it.

Within the Roth, I want to buy $3000 of the REIT index fund, and put the rest in the Vangaurd 2040 fund (which does have a small percent emerging markets). I'll then set my future contributions to the 2040 fund and most likely put my old 401k into the 2040 fund as well. When my portfolio grows more, I may invest more into the emerging markets fund, but probably not any time in 2008.

Last I'll use the index funds in my 401k to balance out my other allocations (small cap, large cap, index, and bonds) as closely as I can to my goal.

What do you think? I do want to have real estate be part of my portfolio, as I don't own property and don't plan on it soon. Should I just wait on the REITs until I can keep them a smaller percent of the portfolio? Or, given the housing market, will they decline all on their own, so I won't have to worry?? :)

In a side note, I temporarily regretted posting anything about my relationship yesterday. People sometimes jump to conclusions based on limited information. I wrote a post detailing things, intending to "clear up" some things. It was wordy and not very personal finance related anyway, so I'll just say it in a concise fashion. It's been 3.5 years. When we were both students, we split things fairly evenly. He would never need a loan from me and is good with money, and will most likely be very successful (someday). He really is on a tight budget as we live in an expensive city. He does pay for things now and then, including dinners, just not this weekend. He spent hours helping me set up my furniture and hang pictures and is really helpful with that kind of thing. I eat his food when I'm at his place (but my food is so much better!) We discussed it briefly, he acknowledged it, and I'll see if it is an issue in the future. If so, I will write about it, but I have to remind myself not to get (too) defensive about the comments!

So, you aren't supposed to keep score in relationships. Still, I can't help it sometimes.

My boyfriend is a poor poor grad student who makes less than half of what I do (stipend). My savings is going up, his is staying flat at best. Naturally, I don't expect him to spend much on us. He is content with not going out to eat much and living quite cheaply, which is great for us in the long run because I'm fairly frugal too. We should never have problems living within our means. Still, sometimes I want treats, so I provide them for us.

This weekend (starting on Thursday) I paid for:
Pizza: $13, a good deal though, for 3 medium pizza's that fed us almost all weekend. I will say nothing about the healthfulness of it...
Sam Adam's White Ale: $14
Lunch at Ikea: $11 (though my fault, since we wouldn't have otherwise been at Ikea and he was helping me pick out and build stuff)
Random Food that we ate: Coffee, cereal, milk, juice, burritos from Trader Joe's.... Plus he made a smoothie that neither of us really needed/wanted (which was much to thick) with my frozen strawberries right before dinner for no logical reason!

Also, he doesn't have a car, so I'm always driving and using my gas. And he definitely ate/drank more of all that stuff than I did.

It isn't that I'm not generous with this kind of thing. I am actually quite generous: "Thanks for coming to Ikea... do you want to stop at the cafe? How about this Mango Sorbet too, that looks delicious!" Then I do my budget, see that I want to save more, then regret my generosity. Ooops.

Then again, how petty is it for me to quibble about $37 spent on "us" when i spent about $200 on me and my apartment at Ikea? It is hard to justify that.

I guess it's the principle rather than the dollar amount. When we stopped at the store to buy juice (potentially for future smoothies or to mix in drinks), he could have paid for it. It was only about $3, so it makes no difference in the scheme of things, but it makes me feel a little less like I'm being taken advantage of. I know that really isn't the case... I offer to do all these things and he would be fine if I stopped. Sometimes I can't help but be bothered by it though.

I guess I need to be careful with my generosity, and really think about it before I offer to pay for things for "us". I need to make sure I won't regret it. Spending money doesn't show love (though, I can't help but think it does, at least a little). I think (hope) that my attitude would be different if we were engaged/married and money spent on us was truly ours and not mine/his. I also think his attitude would be a little different as well. But it just isn't like that right now. It is my money, and if I'm going to share it, I need to make sure I'm sharing it within my budget.

My boyfriend randomly started up a personal finance conversation with me last night. He isn't that well informed (though he's good with money), so it was fun for me to share what I've learned from this personal finance blogosphere. Not that I mentioned my blog--it's private for now, though I wouldn't be horrified to share it with him.

One thing he came up with was a goal that we should try to have 150k saved up for a house in the next 3.5 years. Not that I do "SMART" goals (specific, measurable... acheiveable... see, I don't even know the acroynm), but I don't to dumb goals either. In fact, I invented a new acronym: Daft, Unattainable, Meaningless and Bogus! I asked if there was any math involved in coming up with that number, and he said no. He just took the date when he'd be done with grad school, pulled another number out of a hat, and said it would be a good goal for our house downpayment.

I did some quick math. Assuming I had to come up with 1/2 of that, I would have to save about $1800 a month. I could maybe do it, if I stopped saving for retirement! Besides, I'm not really all that keen on property ownership at this point in my life. I don't even know where I want to settle! I told him that we could discuss a goal like this if/when we are engaged, but for now, I'm sticking to my own goals. I'm willing to compromise, but not just on some whim of his!

Speaking of retirement, I would like to leave you with this depressing snapshot of my 401k. I'm sure glad I don't need this money for years!

I had three really close girl friends in high school. My senior year their was a fourth girl we spent a lot of time with as well. Of the five of us, I'm the ONLY ONE who is not currently married. I'm twenty-five, and the rest of them are about the same. Most have been married about a year, but one girl has been married almost 4 years already.

I've been with my boyfriend for about 3.5 years, and it isn't a real secret to many people that I had hoped to be engaged quite awhile ago. I'm not exactly "pushing for it" at this point (does that really work anyway?) but based on conversations we had in our relationship, I honestly thought it would have happened awhile ago. However, plans adjusted, and it seems like it'll happen eventually, but there isn't a rush right now. People around here don't always understand that. They think at 25, I'm a candidate for becoming an old maid. I'm willing to wait, at least for now. There certainly may come a time when waiting isn't the right thing for me anymore, but I don't know when that time is.

Oh, wait, is this personal finance blog? What is my point?

As much as I thought getting married ASAP would be ideal, there is something to be said for starting off a career on your own. I enjoy reading other young female bloggers, especially those who are also unmarried, and thinking how just a couple generations ago our lives would have been unthinkable. Though I admit I've had the emotional support of a relationship, I do rent my own apartment, pay my own bills, and really came into my own financially in a way that I simply wouldn't have had I been legally tied to another person. I'm sure we would have figured this stuff out together, but the whole financially independent thing is something I'm a little proud of myself for accomplishing. Independence in general is something I'm proud of.

Trent over at the The Simple Dollar recently wrote about how having a family and kids has totally changed his priorities in life. Being unmarried (when most of the people I know are married) has allowed me to keep my choices strictly my own. I'm not saying that I need to hold onto that forever, but I might as well enjoy this independence while I have it.

(Oh, and even though I'm all about frugality and practical purchases, I still want a diamond engagement ring. I simply can't help it. Do you agree?)

I think my parents are finally getting serious about their finances. It's long overdue (they are in their late 40s) but better now than in 10 or 20 more years. Or never.

To clarify, my mom has always been relatively good with her money. She was the one who paid the bills and took us clothes shopping. She rarely bought anything for herself (and conveniently, shared our clothes when we were in high school! The perks of being a petite woman with three girls!) and always worked hard. She has been good with money, but doesn't seem to branch too far from the basics of budgeting and getting things paid.

My dad has always been awful with money. He grew up in a very poor family and didn't learn anything about how to manage money. Things went alright for them when he worked for someone else. He'd get paid, turn the check into my mom, and she took care of the magic. It all fell apart when he went to business for himself. He worked hard enough, but it takes more than that to run a business. Let's just say that from the time I was about 16 until earlier this year, their finances were a bit of a disaster.

These days, my parents are doing something pretty neat since all of us kids are off on our own. My mom does travel nursing, and my dad (an electrician) finds work wherever they go. They take 3-6 month assignments in various cities in the US (mostly California, lately) and work. They are too young to retire, but they are able to see more of the world than they ever have before. I'm very proud that they took the initiative to do this, and they seem to really love it.

Anyway, for the first time in my life, my dad seems to be exceptionally careful with money. They have finally canceled their home phone line (they are there less than 6 months a year anyway!) and he announced to me that he was happy that that was saving him $30 a month. He also realized he was being charged a fee for his checking account, and promptly switched to a different version. Since they are traveling a lot, it doesn't make a lot of sense to buy "stuff", so they don't purchase a whole lot anymore. He also has been pestering me to get off of his car insurance plan once I get settled into Los Angeles. That'll save him several hundred dollars!

As much as I have loved having my car insurance paid, it is really a huge relief for me to hear them talking about saving money. Even if it costs me.

He's still not perfect--for Christmas he bought some overpriced remote controlled helicopters for a couple of his nephews, even though they are so obviously too young to be able to fly them. I bet they are broken by now. Still, he's made huge headway.

I've never read Dave Ramsey's "Total Money Makeover" book. I'm not the target audience for it, but my dad seems like he might be. It would be a little awkward for me to give it to him, and he is more of a magazine/newspaper guy than a book guy. Still, I'm going to keep my eyes out for a non-intrusive way to suggest it. I'm excited that they might live in the same city as me for one of their assignments. If my dad is actually receptive to this personal finance stuff, I might be able to sneak in a few other suggestions. Get a high yield savings account! Check your credit report for free! Have you considered a Roth IRA? Can I help?!?! Please!

Does anyone else find themselves more versed in personal finance than their parents? Have you ever made suggestions to them, or is it usually the other way around?

When I first graduated college, I knew very little about personal finance. I'd done a few smart things along the way, but wasn't even well versed on what I now consider the basics of personal finance. I knew enough to participate in my company's 401k and to consolidate my student loans, but I didn't consider a Roth IRA until I'd been out of school for over six months. I had an excellent credit score, but my asset allocation was completely out of whack.

I've been a huge NPR fan for years, and as I suddenly had paychecks coming in, I started listening to "Marketplace Money" on a weekly basis. From there, I found a the personal finance blogosphere, and the rest is history.

The very first personal finance task I tackled was my student loan debt. I had roughly 21k in federal subsidized Stafford loans, with another 6k in private loans. Since I had all this money coming in, I immediately started paying as much as possible on my private student loans. The interest rate was probably around 8%--nothing too terrible, but not a dream either. It felt so good to send them checks for $500 or $1000 and watch the balances decrease.

After the private loans were gone, I had a desire to tackle the federal loans. Despite the low interest rate, the balance really bothered me. I think part of it was influenced by my boyfriends mindset that all debt was bad. It took me months to convince him he really should get a credit card in order to build a credit history. It took me weeks to get him to move his money from a standard savings account to something that actually would pay him some interest. And though I have explained this to him more than once, I think it will take quite some time before I'm able to get him to understand that rushing to pay of my low interest loans at the expense of other goals is really not the best move.

As I've become more educated in personal finance, the student loan balance bothers me a lot less. In fact, it has dropped to the absolute bottom of my list of priorities. I still pay a little extra each month: Instead of the $133 due, I pay $175. This will shorten the life of the loan by about 8 years. I still plan to pay them off even more quickly than that, but I don't plan on accelerating them any more until bigger priorities are met: maxing out a 401k and a Roth, for example.

The reality is, most of my other personal finance goals would be out of reach if I had not borrowed that money to get an education. Each month when that money comes out of my account, I still think it was money well spent.

My boyfriend compliments me sometimes, saying that I'm good with money. He says that, but once or twice, he has added "but I'm better with it!"

I respectfully disagree with that sentiment. I'm better with money, he's just more stingy. Also, his stingyness comes primarily from the fact that he is a grad student and has a very limited disposable income. In general, he is selectively stingy. Back when he was making a reasonable income, he spent in the range of $3000 for private pilot flying lessons. So he spends less by buying cheap lunch meat and kraft singles, and I buy better stuff. I don't consider that being better with money, I consider that having more money and making choices, not being "worse" with money.

I think when we are married, we'll be able to manage our finances without too much conflict. We are both generally savers, but we are both (generally) willing to spend on certian things we value: for example, travel, occasional good meals, and wine. We should make decent money, and things should be smooth. And if they are not, we both are capable of cheap living.

I hope I get to be in charge of the budgeting and bill paying. I am a control freak and like that sort of thing, but he is a control freak as well. Of course, decision making will be together (which will be an adjustment after years of independence), but there has to be one executer.

I would like us both to be involved in our investment decisions. Since I already have a full time job and he is still in school, I'm a few years ahead of him in investment knowledge. Not that I'm an expert, but I'm at relatively comfortable with the basics. He does have a Roth IRA, but he opened it with a broker. Edward Jones, maybe? I'd need to let him know the virtues of target date funds, indexing, and low fees. Right now, he only has about 2-4k in there (I don't know the details), and I don't know the fees, so it isn't an issue. (Besides the fact we aren't even engaged!)

I think, over the next couple years (or until whenever it is we get married and what is "mine" officially becomes "ours") money might be a slight issue for us due to vast income disparity. If I want us to go out for dinner, I'm going to have to pay for it more often than not. He isn't gonig to demand to be taken out, but he doesn't have the funds to treat me too often. It is sort of something that I have accepted already over the last year and a half of me working and him being a student. It can be frusterating, especially when my my two closest friends from high school (who were students at the time) received coach purses for christmas last year from their signifcant others. I got a nice necklace, which is great, but it would be nice to be spoiled every now and then. Maybe he can spoil me in ways that don't involve spending money.

I spent the week surrounding New Years Eve with a friend I rarely see (we met on a study abroad semester), our boyfriends, and another friend of hers. With the exception of my boyfriend (still a grad student), everyone had just recently entered the working world.

One night, they wanted to go to a "fancy" restaurant for dinner one night, and my boyfriend and I politely declined but offered them the use of the car to go. They graciously offered to treat us, so we agreed to come along. The bf and I politely ordered relatively lower priced items (still probably $40 each), and the others ordered appetizers and dessert (though they were kind enough to share). Dinner for the five of us was about $350, maybe more. The food was decent, but didn't knock my socks off. The service was good, but not worth that kind of money to me at this point in my life.

Then there was the shopping. My jaw just about fell off when one girl stated that a $1000 handbag was "within the price range" she was looking for. I have no idea her salary (though I do think she lives with her parents, meaning, no rent, which helps), but it just seemed utterly unreasonable to pay that much for a handbag. Still, people do it. All the time. Just not many people that I know.

Sometimes it strikes me unfair when I see people my age spending on expensive items. In many cases, it is flat out unfair--their parents helped them through school and maybe even still subsidize their lifestyles, while mine didn't. Very few people are wealthy by their own doing at age 24. Many people are comfortable (myself included), but having enough wealth to live the high life? Not me.

Really, it doesn't matter if it is fair or not. Not one bit. All that matters is they are good people who don't make me feel bad about being more careful with my money. I do my best not to make them feel bad that they do spend more money.

I think when I move to Los Angeles, I'm going to run into this feeling a lot more than I do here in the Midwest. I'm extremely down to earth, and the L.A. stereotype isn't. I'm sure some won't fit the stereotype, but I'll surely meet a lot more people with piles of money than I know now. I'll also working at a big name company where many people went to top schools. I went to state school. You've never heard of my school. I was smart enough for a better school, but the finances just wouldn't have worked out. In some ways, it makes me proud of myself. I got to the same place as them, on my own, without a fancy school or lots of money. Even so, I wouldn't have minded if my parents paid for a top notch education. It wouldn't make me any less of a person.

Anyway,the girl who bought a Burberry towel (a towel? Why?) and a $250 watch (spur of the moment, out of spite!) suggests getting one coke at a pizza place and sharing the free refils. Too funny.

After yesterday's post on being impatient to enroll in my company's 401k, today I found that I was finally "in the system" and could enroll! I eagerly got to the screen where I could indicate I wanted to save 15% of my pretax income. Then came the fund allocation screen....

Crap. I wasn't 100% prepared for this despite it being on my to-do list from about a week ago. I do have a loose plan of what I want to do, but haven't figure out how to align my three accounts into one asset allocation.

My overall goal for my asset allocation goal is as follows:

• Stocks/Bonds: 88%/12%
• Within stocks, Domestic/International: 60%/40%
• Within Domestic, Large Cap/Small Cap/REIT: 75%/15%/15%

I also would like 10% of my international allocations in emerging markets, and someday I may want to do something fancier with bonds as I hear a lot about TIPS and Treasury and things I don't know anything about (right now I just use a bond index fund).

Overall, this breaks down to 6 funds allocated as follows:

• Large Cap 37%
• Small Cap 8%
• REIT 8%
• Int. Index 32%
• Emerg. Mkts 4%
• Bond Idx 12%

Do you think I'm missing anything important?

There are some issues with this right now. It is pretty impossible for me to actually get the 4% emerging markets allocation or even the 8% REIT allocation. I don't have those options in my 401k, and Vanguard requires minimum investments of $3000, which is currently 15% of my portfolio. Besides, I don't really know exactly what my current allocation is, mostly because Fidelity's 2040 fund has about a zillion different holdings.

So, what is my plan? First, I need to move both my Roth IRA and old 401k to Vanguard, while rolling the 401k to an IRA. Then I want to roll $5000 of the 401k into the Roth. Why just $5000? Because I don't want to get hit with taxes on the full $15k this year. I figure I'll roll it into my Roth over a period of 2-3 years, hurrying it along if it becomes necessary (meaning, if I end up planning to get married before then, as the income limits are harder to meet if you aren't single). Perhaps more on the rollover later, as I contemplate all the implications of it.

Within the Roth, I want to buy $3000 of the REIT index fund, and put the rest in the Vangaurd 2040 fund (which does have a small percent emerging markets). I'll then set my future contributions to the 2040 fund and most likely put my old 401k into the 2040 fund as well. When my portfolio grows more, I may invest more into the emerging markets fund, but probably not any time in 2008.

Last I'll use the index funds in my 401k to balance out my other allocations (small cap, large cap, index, and bonds) as closely as I can to my goal.

What do you think? I do want to have real estate be part of my portfolio, as I don't own property and don't plan on it soon. Should I just wait on the REITs until I can keep them a smaller percent of the portfolio? Or, given the housing market, will they decline all on their own, so I won't have to worry?? :)

In a side note, I temporarily regretted posting anything about my relationship yesterday. People sometimes jump to conclusions based on limited information. I wrote a post detailing things, intending to "clear up" some things. It was wordy and not very personal finance related anyway, so I'll just say it in a concise fashion. It's been 3.5 years. When we were both students, we split things fairly evenly. He would never need a loan from me and is good with money, and will most likely be very successful (someday). He really is on a tight budget as we live in an expensive city. He does pay for things now and then, including dinners, just not this weekend. He spent hours helping me set up my furniture and hang pictures and is really helpful with that kind of thing. I eat his food when I'm at his place (but my food is so much better!) We discussed it briefly, he acknowledged it, and I'll see if it is an issue in the future. If so, I will write about it, but I have to remind myself not to get (too) defensive about the comments!

So, you aren't supposed to keep score in relationships. Still, I can't help it sometimes.

My boyfriend is a poor poor grad student who makes less than half of what I do (stipend). My savings is going up, his is staying flat at best. Naturally, I don't expect him to spend much on us. He is content with not going out to eat much and living quite cheaply, which is great for us in the long run because I'm fairly frugal too. We should never have problems living within our means. Still, sometimes I want treats, so I provide them for us.

This weekend (starting on Thursday) I paid for:
Pizza: $13, a good deal though, for 3 medium pizza's that fed us almost all weekend. I will say nothing about the healthfulness of it...
Sam Adam's White Ale: $14
Lunch at Ikea: $11 (though my fault, since we wouldn't have otherwise been at Ikea and he was helping me pick out and build stuff)
Random Food that we ate: Coffee, cereal, milk, juice, burritos from Trader Joe's.... Plus he made a smoothie that neither of us really needed/wanted (which was much to thick) with my frozen strawberries right before dinner for no logical reason!

Also, he doesn't have a car, so I'm always driving and using my gas. And he definitely ate/drank more of all that stuff than I did.

It isn't that I'm not generous with this kind of thing. I am actually quite generous: "Thanks for coming to Ikea... do you want to stop at the cafe? How about this Mango Sorbet too, that looks delicious!" Then I do my budget, see that I want to save more, then regret my generosity. Ooops.

Then again, how petty is it for me to quibble about $37 spent on "us" when i spent about $200 on me and my apartment at Ikea? It is hard to justify that.

I guess it's the principle rather than the dollar amount. When we stopped at the store to buy juice (potentially for future smoothies or to mix in drinks), he could have paid for it. It was only about $3, so it makes no difference in the scheme of things, but it makes me feel a little less like I'm being taken advantage of. I know that really isn't the case... I offer to do all these things and he would be fine if I stopped. Sometimes I can't help but be bothered by it though.

I guess I need to be careful with my generosity, and really think about it before I offer to pay for things for "us". I need to make sure I won't regret it. Spending money doesn't show love (though, I can't help but think it does, at least a little). I think (hope) that my attitude would be different if we were engaged/married and money spent on us was truly ours and not mine/his. I also think his attitude would be a little different as well. But it just isn't like that right now. It is my money, and if I'm going to share it, I need to make sure I'm sharing it within my budget.

My boyfriend randomly started up a personal finance conversation with me last night. He isn't that well informed (though he's good with money), so it was fun for me to share what I've learned from this personal finance blogosphere. Not that I mentioned my blog--it's private for now, though I wouldn't be horrified to share it with him.

One thing he came up with was a goal that we should try to have 150k saved up for a house in the next 3.5 years. Not that I do "SMART" goals (specific, measurable... acheiveable... see, I don't even know the acroynm), but I don't to dumb goals either. In fact, I invented a new acronym: Daft, Unattainable, Meaningless and Bogus! I asked if there was any math involved in coming up with that number, and he said no. He just took the date when he'd be done with grad school, pulled another number out of a hat, and said it would be a good goal for our house downpayment.

I did some quick math. Assuming I had to come up with 1/2 of that, I would have to save about $1800 a month. I could maybe do it, if I stopped saving for retirement! Besides, I'm not really all that keen on property ownership at this point in my life. I don't even know where I want to settle! I told him that we could discuss a goal like this if/when we are engaged, but for now, I'm sticking to my own goals. I'm willing to compromise, but not just on some whim of his!

Speaking of retirement, I would like to leave you with this depressing snapshot of my 401k. I'm sure glad I don't need this money for years!

I had three really close girl friends in high school. My senior year their was a fourth girl we spent a lot of time with as well. Of the five of us, I'm the ONLY ONE who is not currently married. I'm twenty-five, and the rest of them are about the same. Most have been married about a year, but one girl has been married almost 4 years already.

I've been with my boyfriend for about 3.5 years, and it isn't a real secret to many people that I had hoped to be engaged quite awhile ago. I'm not exactly "pushing for it" at this point (does that really work anyway?) but based on conversations we had in our relationship, I honestly thought it would have happened awhile ago. However, plans adjusted, and it seems like it'll happen eventually, but there isn't a rush right now. People around here don't always understand that. They think at 25, I'm a candidate for becoming an old maid. I'm willing to wait, at least for now. There certainly may come a time when waiting isn't the right thing for me anymore, but I don't know when that time is.

Oh, wait, is this personal finance blog? What is my point?

As much as I thought getting married ASAP would be ideal, there is something to be said for starting off a career on your own. I enjoy reading other young female bloggers, especially those who are also unmarried, and thinking how just a couple generations ago our lives would have been unthinkable. Though I admit I've had the emotional support of a relationship, I do rent my own apartment, pay my own bills, and really came into my own financially in a way that I simply wouldn't have had I been legally tied to another person. I'm sure we would have figured this stuff out together, but the whole financially independent thing is something I'm a little proud of myself for accomplishing. Independence in general is something I'm proud of.

Trent over at the The Simple Dollar recently wrote about how having a family and kids has totally changed his priorities in life. Being unmarried (when most of the people I know are married) has allowed me to keep my choices strictly my own. I'm not saying that I need to hold onto that forever, but I might as well enjoy this independence while I have it.

(Oh, and even though I'm all about frugality and practical purchases, I still want a diamond engagement ring. I simply can't help it. Do you agree?)

I think my parents are finally getting serious about their finances. It's long overdue (they are in their late 40s) but better now than in 10 or 20 more years. Or never.

To clarify, my mom has always been relatively good with her money. She was the one who paid the bills and took us clothes shopping. She rarely bought anything for herself (and conveniently, shared our clothes when we were in high school! The perks of being a petite woman with three girls!) and always worked hard. She has been good with money, but doesn't seem to branch too far from the basics of budgeting and getting things paid.

My dad has always been awful with money. He grew up in a very poor family and didn't learn anything about how to manage money. Things went alright for them when he worked for someone else. He'd get paid, turn the check into my mom, and she took care of the magic. It all fell apart when he went to business for himself. He worked hard enough, but it takes more than that to run a business. Let's just say that from the time I was about 16 until earlier this year, their finances were a bit of a disaster.

These days, my parents are doing something pretty neat since all of us kids are off on our own. My mom does travel nursing, and my dad (an electrician) finds work wherever they go. They take 3-6 month assignments in various cities in the US (mostly California, lately) and work. They are too young to retire, but they are able to see more of the world than they ever have before. I'm very proud that they took the initiative to do this, and they seem to really love it.

Anyway, for the first time in my life, my dad seems to be exceptionally careful with money. They have finally canceled their home phone line (they are there less than 6 months a year anyway!) and he announced to me that he was happy that that was saving him $30 a month. He also realized he was being charged a fee for his checking account, and promptly switched to a different version. Since they are traveling a lot, it doesn't make a lot of sense to buy "stuff", so they don't purchase a whole lot anymore. He also has been pestering me to get off of his car insurance plan once I get settled into Los Angeles. That'll save him several hundred dollars!

As much as I have loved having my car insurance paid, it is really a huge relief for me to hear them talking about saving money. Even if it costs me.

He's still not perfect--for Christmas he bought some overpriced remote controlled helicopters for a couple of his nephews, even though they are so obviously too young to be able to fly them. I bet they are broken by now. Still, he's made huge headway.

I've never read Dave Ramsey's "Total Money Makeover" book. I'm not the target audience for it, but my dad seems like he might be. It would be a little awkward for me to give it to him, and he is more of a magazine/newspaper guy than a book guy. Still, I'm going to keep my eyes out for a non-intrusive way to suggest it. I'm excited that they might live in the same city as me for one of their assignments. If my dad is actually receptive to this personal finance stuff, I might be able to sneak in a few other suggestions. Get a high yield savings account! Check your credit report for free! Have you considered a Roth IRA? Can I help?!?! Please!

Does anyone else find themselves more versed in personal finance than their parents? Have you ever made suggestions to them, or is it usually the other way around?

When I first graduated college, I knew very little about personal finance. I'd done a few smart things along the way, but wasn't even well versed on what I now consider the basics of personal finance. I knew enough to participate in my company's 401k and to consolidate my student loans, but I didn't consider a Roth IRA until I'd been out of school for over six months. I had an excellent credit score, but my asset allocation was completely out of whack.

I've been a huge NPR fan for years, and as I suddenly had paychecks coming in, I started listening to "Marketplace Money" on a weekly basis. From there, I found a the personal finance blogosphere, and the rest is history.

The very first personal finance task I tackled was my student loan debt. I had roughly 21k in federal subsidized Stafford loans, with another 6k in private loans. Since I had all this money coming in, I immediately started paying as much as possible on my private student loans. The interest rate was probably around 8%--nothing too terrible, but not a dream either. It felt so good to send them checks for $500 or $1000 and watch the balances decrease.

After the private loans were gone, I had a desire to tackle the federal loans. Despite the low interest rate, the balance really bothered me. I think part of it was influenced by my boyfriends mindset that all debt was bad. It took me months to convince him he really should get a credit card in order to build a credit history. It took me weeks to get him to move his money from a standard savings account to something that actually would pay him some interest. And though I have explained this to him more than once, I think it will take quite some time before I'm able to get him to understand that rushing to pay of my low interest loans at the expense of other goals is really not the best move.

As I've become more educated in personal finance, the student loan balance bothers me a lot less. In fact, it has dropped to the absolute bottom of my list of priorities. I still pay a little extra each month: Instead of the $133 due, I pay $175. This will shorten the life of the loan by about 8 years. I still plan to pay them off even more quickly than that, but I don't plan on accelerating them any more until bigger priorities are met: maxing out a 401k and a Roth, for example.

The reality is, most of my other personal finance goals would be out of reach if I had not borrowed that money to get an education. Each month when that money comes out of my account, I still think it was money well spent.

My boyfriend compliments me sometimes, saying that I'm good with money. He says that, but once or twice, he has added "but I'm better with it!"

I respectfully disagree with that sentiment. I'm better with money, he's just more stingy. Also, his stingyness comes primarily from the fact that he is a grad student and has a very limited disposable income. In general, he is selectively stingy. Back when he was making a reasonable income, he spent in the range of $3000 for private pilot flying lessons. So he spends less by buying cheap lunch meat and kraft singles, and I buy better stuff. I don't consider that being better with money, I consider that having more money and making choices, not being "worse" with money.

I think when we are married, we'll be able to manage our finances without too much conflict. We are both generally savers, but we are both (generally) willing to spend on certian things we value: for example, travel, occasional good meals, and wine. We should make decent money, and things should be smooth. And if they are not, we both are capable of cheap living.

I hope I get to be in charge of the budgeting and bill paying. I am a control freak and like that sort of thing, but he is a control freak as well. Of course, decision making will be together (which will be an adjustment after years of independence), but there has to be one executer.

I would like us both to be involved in our investment decisions. Since I already have a full time job and he is still in school, I'm a few years ahead of him in investment knowledge. Not that I'm an expert, but I'm at relatively comfortable with the basics. He does have a Roth IRA, but he opened it with a broker. Edward Jones, maybe? I'd need to let him know the virtues of target date funds, indexing, and low fees. Right now, he only has about 2-4k in there (I don't know the details), and I don't know the fees, so it isn't an issue. (Besides the fact we aren't even engaged!)

I think, over the next couple years (or until whenever it is we get married and what is "mine" officially becomes "ours") money might be a slight issue for us due to vast income disparity. If I want us to go out for dinner, I'm going to have to pay for it more often than not. He isn't gonig to demand to be taken out, but he doesn't have the funds to treat me too often. It is sort of something that I have accepted already over the last year and a half of me working and him being a student. It can be frusterating, especially when my my two closest friends from high school (who were students at the time) received coach purses for christmas last year from their signifcant others. I got a nice necklace, which is great, but it would be nice to be spoiled every now and then. Maybe he can spoil me in ways that don't involve spending money.

I spent the week surrounding New Years Eve with a friend I rarely see (we met on a study abroad semester), our boyfriends, and another friend of hers. With the exception of my boyfriend (still a grad student), everyone had just recently entered the working world.

One night, they wanted to go to a "fancy" restaurant for dinner one night, and my boyfriend and I politely declined but offered them the use of the car to go. They graciously offered to treat us, so we agreed to come along. The bf and I politely ordered relatively lower priced items (still probably $40 each), and the others ordered appetizers and dessert (though they were kind enough to share). Dinner for the five of us was about $350, maybe more. The food was decent, but didn't knock my socks off. The service was good, but not worth that kind of money to me at this point in my life.

Then there was the shopping. My jaw just about fell off when one girl stated that a $1000 handbag was "within the price range" she was looking for. I have no idea her salary (though I do think she lives with her parents, meaning, no rent, which helps), but it just seemed utterly unreasonable to pay that much for a handbag. Still, people do it. All the time. Just not many people that I know.

Sometimes it strikes me unfair when I see people my age spending on expensive items. In many cases, it is flat out unfair--their parents helped them through school and maybe even still subsidize their lifestyles, while mine didn't. Very few people are wealthy by their own doing at age 24. Many people are comfortable (myself included), but having enough wealth to live the high life? Not me.

Really, it doesn't matter if it is fair or not. Not one bit. All that matters is they are good people who don't make me feel bad about being more careful with my money. I do my best not to make them feel bad that they do spend more money.

I think when I move to Los Angeles, I'm going to run into this feeling a lot more than I do here in the Midwest. I'm extremely down to earth, and the L.A. stereotype isn't. I'm sure some won't fit the stereotype, but I'll surely meet a lot more people with piles of money than I know now. I'll also working at a big name company where many people went to top schools. I went to state school. You've never heard of my school. I was smart enough for a better school, but the finances just wouldn't have worked out. In some ways, it makes me proud of myself. I got to the same place as them, on my own, without a fancy school or lots of money. Even so, I wouldn't have minded if my parents paid for a top notch education. It wouldn't make me any less of a person.

Anyway,the girl who bought a Burberry towel (a towel? Why?) and a $250 watch (spur of the moment, out of spite!) suggests getting one coke at a pizza place and sharing the free refils. Too funny.