Enoughwealth's Personal Finance Blog

Browsing for info on the net I found out that stair climbing burns 0.15 kcal per step up, and 0.05 kcal per step down. So today's 532 steps (each way) should have burned an extra 106 kcals - assuming I'd otherwise have been sitting around doing nothing. By the end of next week I hope to be a bit more in condition so I can do 13 "laps" of the "stairway from hell" - a total of 988 steps daily. This should take around 30 mins each lunchtime at work, and burn off 198 extra kcals. As 3,500 kcals/wk equates to 0.5 kg/wk of body fat, this should help me lose an extra .15 kg/wk compared to just dieting.

One thing to note is that even vigorous exercising for the recommended 30 mins/day won't burn off enough calories to lose much weight by itself (although it will help you lose fat and gain muscle, so you look better than just dieting, and will help you get fit). By comparison, eating 500 kcals/day less than your "maintenance" intake should lead to a weight loss of around 0.5 kg/week.

Overall my diet plan is for around 1,800-2,000 kcals/day (with only 5-10% cals from fat). Based on an estimated 2,800 kcals/day for "maintenance" I should lose around 1 kg/week from CRAN (calorie restriction with adequate nutrition) and another .15 kg/week from increased daily activity (exercise). At a rate of -1.15 kg/week in total I should reach my "ideal" weight (based on getting to a BMI of around 22) in 26 weeks - a nice round 6 months. My goal is to get below 70kg before the end of the Australian Financial Year (30th June).

As you lose weight your maintenance calorie requirement drops (also with CRAN your metabolism tends to slow a bit, though this is offset by boosting metabolic rate via exercise). So I'll probably have to add some additional exercise towards the end. Stair climbing is good to start with, as it seems fairly "low impact" if done in a controlled manner (ie. not like Rocky Balboa!), but once I get down to less than 80 kg I'll start to do some rope skipping. Skipping is a good exercise as it can be done indoors, so it's good for home at night, even if it's bad weather outside. Skipping has a METs rating of 12 (METs = metabolic equivalents. One MET is defined as the energy it takes to sit quietly) compared to stair climbing (8.6 METs) and stair descending (2.6 METs). So skipping will burn around twice as many kcals per minute as climbing up and down flights of stairs. So doing 15 minutes skipping each evening in addition to my lunchtime stair exercise would double the amount of calories burnt off by exercising each day.

Once I reach my "ideal" weight I'll ease back on the exercise a bit (to the recommended 30 mins brisk walk a day) so that my weight stabilises while still sticking to the same CRAN diet. Supposedly CRAN has good prospects of helping you reach your optimal lifespan - although starting it seriously at age 45 is not ideal. It would obviously have been better to maintain my ideal weight and stick to it using CRAN throughout my adult life.

Spent $97.76 on groceries and vitamins, did my planned exercise (532 stair steps) and stuck to my diet plan. A land valuation notice for our home arrived today - apparently the land value has gone up 7% from $400,000 to $428,000 over the past three years, even though house prices have been static. A new valuation is issued every 3-4 years and is the basis for our local rates assessment. This will mean our local taxes will be considerably higher this year.

A no spend day, I ate healthily (is that a real word?) and did 5.5 "laps" (418 steps) of the "tower of terror" (aka. "stairway to hell" - see pic below). On the financial front the Australian stock market went back up by 80 points (around 1.5%) today, after falling by a similar amount yesterday. As each point change translates to around $90 change in my NW this would be hair-raising if I wasn't planning to hold on to my stock portfolio for the next 20+ years. As it is I just get a laugh listening to the business news "explaining" the changes - apparently yesterday there was either negative "market" sentiment, "more sellers than buyers", or the stock market was overpriced. Today either the "bargain hunters" were out in force (at 2.5% below a recent all time high?), or everyone had decided inflation was suddenly under control because the oil price had dropped a little bit. Ah well, nice to see "Mr Market" is alive and well.

A credit card offer from HSBC addressed to "The Householder" arrived in post today. Nice to see that "Householder" was "conditionally approved" for a card! I may apply for a card as they are offering 0% interest on balance transfers until 1 October 2007, and no fees for the first year. Presumably I could cancel the card after paying off the balance transfer in September and avoid paying any fees. If I get $10,000 transferred to my normal CC account I can then withdraw the money as a cash advance (for a $10 fee) and invest the money at 6% in an online savings account for 8 months, netting $400, or around $240 after taxes. Every little bit helps.

Here's the regular round up on how the various PF bloggers who post Net Worth each month are progressing. I've added a couple of new ones this month. Leave a comment if I've missed yours out!
Monthly Net Worth of PF Bloggers for DEC 2006:

Blogger Age Net Worth $ Change % Change
Accumulating Money 2x $45,705.16 $2,563.37 5.9%
Binary Dollar 25 -$5,724.36 $4,521.17 N/A
Blogging Away Debt 2x -$38,691.00 $1,757.00 4.3%
Consumerism Commentary 30 $70,108.19 $2,820.68 4.2%
Crazy Money 27 $241,889.00 $8,238.00 3.5%
Enough Wealth 45 $1,032,783.00 $41,091.00 4.1%
Financial Freedom 30 $250,775.82 $16,972.50 7.3%
Financial ladder xx $134,846.55 $3,119.72 2.3%
Ima Saver 6x no Dec data no Dec data N/A
It's Just Money 32 no Dec data no Dec data N/A
Lazy Man and Money 2x no Dec data no Dec data N/A
Make love, not debt 2x -$70,787.04 $4,207.07 5.6%
Making Our Way 37 $605,201.77 -$8,224.51 -1.3%
Mapgirl 32 no Dec data no Dec data N/A
My Money Blog 28 $114,508.00 -$4,603.00 -3.9%
My Money Path 29 $105,092.00 $2,612.00 2.5%
My Open Wallet 37 $312,771.00 N/A v N/A
New Age Personal Finance 31 $151,917.64 $9,810.87 6.9%
Savvy Saver 27 $220,286.00 $2,837.00 1.3%
Tired But Happy xx $110,270.00 N/A N/A

nb. Some ages have been adjusted as follows:
exact age provided = listed as given
"20's" = listed as 2x
"early 20's" = listed as 22
"mid-late 20's" = listed as 27
and so on.

Fortunately yesterday's flat tyre was able to be patched, so it ended up only costing $30 (better than a new tyre, especially as this one was only a couple of months old). First day back at work was business as usual. At lunch time I went to the shops and withdrew $400 from my credit union account so that I could pay $397 into our Joint Account (to cover the interest for my "little book" US share portfolio for last month). Also spent $44.71 on groceries and $15.18 on petrol (the tank was still half full, but I had a 10c/L discount voucher which expires today, and the petrol price was near its weekly low).

I did manage to stick to my eating plan today, and did four "laps" of the four storey staircase near my workplace after lunch. By the end of the fourth ascent (304 steps in total, but who's counting?) my legs were getting a bit wobbly, and I realised just how little exercise I'd been getting since I stopped the daily paper round with DS1 last July. Hopefully I'll have recovered enough to manage at least two "laps" tomorrow, preferably four. Apparently climbing stairs has a "METS" rating of 8.0, compared to 3.5 for a brisk walk, so ten minutes of stair climbing a day should be equivalent to a 20 min walk. By the end of the week I should be able do ten "laps" a day in 15 minute sessions - maybe

Spent $114.51 on groceries yesterday and another $88.27 today on groceries and some school supplies for DS1. I didn't do any exercise this weekend, but at least I stuck (more or less) to my diet plan. I'll have to make an effort to get some exercise at work tomorrow - there's a four storey metal staircase built into a cliff near my workplace (with a nice few of the Sydney skyline and Harbour Bridge from the top), so if it's not too hot at lunch time I'll climb up and down the staircase a few times for my exercise.

While driving home from the shops this afternoon the car's handling felt a bit odd - I thought the roads may have been a bit slippery from the rain, but it happened a bit too regularly so I checked all the tyres when we arrived home. Sure enough, one tyre was a bit soft and I found a nail stuck in it. As soon as I removed the nail the tyre completely deflated, so I had to put on the spare. I'll drop the car in for a new tyre tomorrow morning on the way to work, and have arranged to get a lift in to work from my co-worker (who lives close to our home). I doubt the puncture can be repaired, so I'll probably have to pay for a new tyre (I only got this one put one a few hundred km ago). Such is life.

For Australians the HILDA survey provides statistically valid data about household net worth and lets you see where you stand in relation to others of similar age or income. For US readers Scott Burns has some interesting posts about his "Wealth Scoreboard" based on similar data for the US. To save you hunting around his website for the latest figures, here they are:
Here’s how the Scoreboard works. Households in the U.S. are divided by age groups and then by the net worth required to be in the top 1 percent, top 5 percent, top 10 percent, and top 25 percent of all households in that age group. A median figure is also provided so you can tell whether you are in the top, or bottom, half of your age group.
If you are 50 to 59 years old, for instance, you’ll need a net worth of at least $188,000 to be in the top half of households that age. You’ll need 3 times that, $570,000, to be in the top 25 percent. And you’ll need a whopping $9,554,000 to be in the top 1 percent. (See table below.)




The Wealth Scoreboard




The table shows median net worth for households, arranged by age of the chief earner. To find your rank, go to the right age category and find the net worth closest to yours. (Data are from 2004; all U.S. dollars are in nominal terms, in thousands.)




Age Group



Top 1%


Top 5%


Top 10%


Top 25%



Median




80 or Older


$3,349


$1,770



$1,149


$536


$188




70 - 79



$9,198


$1,945


$1,106


$489



$183




60 - 69


$10,188


$3,075



$1,522


$699


$232




50 - 59



$9,554


$2,223


$1,180


$570



$188




40 - 49


$4,710


$1,297



$746


$353


$113




30 - 39



$1,971


$451


$272


$121



$39




20 - 29


$607


$206



$103


$30


$6



Source: VIP Forum, based on data in the 2004 Survey of Consumer Finances



The Scoreboard is put together by VIP Forum, a Washington DC based group that does research on wealth and wealth management practices. The basic data comes from a Federal Reserve survey that is done every three years, the Survey of Consumer Finances. The last survey was done in 2004.

You can get a coupon for 10% off online Target purchases by accessing Target deals via the couponchief website. Once you've navigated to the Target site via one of the links provided, you can browse the Target online shopping site and you should automatically see the 10% discount when you get to the checkout page.

Couponchief has a wide range of other coupons and deals available online - for example, Dell, Sony, Overstock and more. You can either browse for deals from a particular merchant, or browse the website by category, or search.

Aside from moving to dedicated hosting fairly recently, No Credit Needed (NCN) has now started to create an individual page for each member. I haven't updated my debt figures for last month yet, but as soon as I do (and NCN sets up my 'homepage' I'll put a permlink to my graph next to my NetWorthIQ chart (If I can display the chart as a link to NCN, rather than just a text link I'll do so).

Most of the NCN members are paying down CC or student loan debt, and hope to pay it off in a couple of years. If you're in a similar situation you can visit NCN for inspiration. Some other members are tracking more hefty debts such as home or investment property mortgages. I think I'm the only one tracking a whole portfolio of debt (mortgages, margin loans etc.) with a "pay off" timeframe of 20+ years!

Grrrr - both a "spend day" AND an "overeat day" - luckily not *too* bad on either front. I took DW and the kids to our local shopping precinct to get a batch of digital photos printed (DW tends to get "cabin fever" if she stays at home for more than a two days in a row, and DS1 loves visiting the shops, even though he never buys anything!) Although the photo printing was free (using a coupon from my dad), DW visited the Target store and bought her and DS2 some clothing. Although the clothing was a real bargain (DW got a blouse for $3.87 that was originally priced over $27) it still ended up being $11.85 spent on clothing. The bad part of this family outing was that while there I succumbed to a "two pizzas for $5 deal" at the Pizza Hut outlet in the foodcourt (they're normally $4.95 each) and totally blew my diet plan for the day by eating them both (they were the small "personal pan" ones meant for 1 person, and it was way too much fat and calories for healthy eating, let along someone supposedly on a "diet"). Ah well, tomorrow is another day to get back on the wagon, and next week I'll be back at work and can "brown bag" my standard lunch each day.

I also nearly went beserk and bought a Grundig LCD TV that was on sale (for $1499 compared to "original" RRP of $3200), but DW convinced me to leave it and come back "tomorrow" to check it out in detail. Luckily when I got home I realised that I should make an in-depth analysis of all it's features and price it compared to other models and makes, and that we don't really *need* another TV right now (although a "big screen" digital TV has been on my "wants" list for a couple of years). Anyhow, I can't be bothered doing the necessary homework right now, and prices will keep dropping on such electronic toys, so I'll try to forget about it for another year or two.

Ended up having to spend something today - $4.35 on petrol for the lawn mower (it ran out of gas half-way through mowing the lawn). Aside from that everything went according to plan - mowed lawn, cleaned gutters, shoveled four wheel barrow loads of earth from one side of the pool to the other (in preparation for putting down some gravel), and have a quick swim. DW has organised some of her digital photos taken this holiday season, so I'll burn them onto a CD tonight so she can take them to get printed tomorrow. She got a coupon for free digital photo printing from my dad (it came with the camera he bought).

It's the last day of my "at home" vacation tomorrow (back to work on Monday), so I'll have to try get the last of my stock portfolio data entered into Quicken and file away the big pile of paid bills and financial statements that's been building up for the past few months.

I'm wondering if I'll receive tax information for my US stock holdings and have to lodge a US tax return. So far I haven't sold any of my "little book" portfolio shares, but I did receive some dividends that had US foreign tax withheld. Not sure if I need to do a US tax return, or can just declare the dividends and claim the foreign tax credit on my Australian Tax return.

A very pleasant day out, with an evening walk around Taronga Zoo for three hours at dusk with my family and my parents. My parents have a "zoo friends" pass ($190 pa) so they are able to take DS1 to the zoo as often as he likes. Tonight (after closing) there was a special "picnic night" offer available to Zoo Friends and their guests, so DW and I got in for just $15 each (normal entry cost is $32 per adult). My parents paid for the entry and brought some sandwiches for our "picnic" dinner, so this was a "no spend" outing from my point of view.

My parents had also brought in some takeaway noodles for DW and themselves, and also brought some extra for me. Unfortunately I "fell off the wagon" and had some fried noodles and a couple of spring rolls for dinner - definitely NOT on my healthy eating plan. To make matters worse I then also ate the ham and turkey sandwiches I was supposed to have had for dinner as a late night supper ;(

Hopefully the three hours of walking around the zoo provided some extra exercise to offset some of this bout of over-eating. Although from memory a serve of fried noodles would take about 100 hours of walking to burn off the extra calories!

My only spending for the day was $18.38 worth of groceries I bought on the way home (so that I won't need to go to the shops for anything tomorrow). I'm planning to mow the lawn, clean out the gutters and do some more "earthworks" around the pool tomorrow, so it *should* be a no spend, high exercise and healthy diet day.... we'll see how it turns out.

The Australian stock market was up around 20+ points (to another "all-time high") before lunch, but then plummeted during the afternoon to end around 26 pts down for the day. This translates to a paper "loss" of around $2500 to my net worth, but as I'm a "long term" investor I try to just ignore the daily ups and downs of the market. Better to just concentrate on the things I can (and should) control - like my diet and exercise.

Another OK day - I managed to just eat mostly the "right stuff" again (hey, maybe I should write an eBook called the "The Right Stuff Diet"! - if so I'd better take the "before" shots for the cover before I get too trim, taut and terrific) and I got a bit of exercise cleaning the pool and shoveling some dirt from one side of the garden to the other. [We had bought a tonne of small river pebbles last year, and the plan is to put them between the path surrounding our pool and the back fence in place of the grass that is currently there. Hopefully the gravel will look a bit neater than the overgrown grass.] My weight is down to 98.6 kg - at the moment weight is dropping off me as if I'm on "The Biggest Loser". I know my weight won't keep dropping at this rate, but if I stick strictly to my diet plan it should average more than 1kg a week.

For the record, today was a fairly typical "diet" day, which comprised:
* 4 "weetbix" for breakfast, with 150ml skim milk and 150 lite soy milk, 4 tspn sugar and 4 tspn "aktavite" (a type of chocolate flavoured, vitamin enriched "sprinkles")
* a low-salt, lite ham and alfalfa sprout sandwich (on 2 slices of white, hyfibre bread)
* 1 navel orange
* 1 tin of chicken/veg soup and 4 slices of white, hyfibre bread (this isn't particularly healthy)
* 100g grapes
* 100g grilled, lean beef
* 50g grilled pumkin
* 100g boiled rice
* 3 "frosty fruit" ice-blocks (frozen fruit juice) (I should only have 1 of these as dessert each day, but it's still better than junk food or icecream)

Today wasn't a "no spend" day as I had to buy some groceries ($43.42) and top up the petrol ($14.97) to last until I go back to work next week. The petrol purchase wasn't too bad as the tank was still half full (not doing as much driving while on vacation at home), Tuesday is the day of the week where petrol price is cheapest around here, I had a 4c/L discount coupon from my shopping docket (which reduced the price to $1.109 per Litre), and I paid for it with the VISA "giftcard" that I'd got from my company as a "bonus".

I made some progress entering the current stock holdings for one of my margin accounts into Quicken (two more margin accounts to go), then my "Little Book" portfolio transactions for the past 7 months). That's the easy part. Going through the past 10-15 years worth of my broker and margin lender statements and my tax returns to fill in all the historical transaction data is not going to be fun. Luckily I still have an old copy of my Quicken files from '98 which had all my stock transactions up to that time entered correctly, so I'll just have to copy and enter them into the new version of Quicken, then work my way forward from '98 and check if the final stock holdings then reconcile. It's times like this that I hate DRPs, stock splits, takeover (especially cash/stock combos) etc. Another reason to only invest in 10-12 individual stocks, or, better yet, index funds).

DS1 visited my parents and they took him out to the cinema to see "Happy Feet". As Tuesday is the "half price" day at the cinemas here, the cost for two "seniors" and a child would have been reasonable. DW took DS1 and DS2 for a walk in the afternoon and collected some free wood chips for our garden beds from up the road (the local council had cut down a dead/dying tree last week and left a pile of wood chips on the side of the road. They usually come back after a week or so and clean up anything that's left).

One good thing with blogging is that I can write stuff that probably only I'm interested in

My New Year's Resolution for healthy living has survived the first day - although I stuck to my healthy eating plan (no snacking on left-over Christmas "goodies"), my exercise for Day 1 was limited to cleaning out the swimming pool. At the moment it's cool and raining in Sydney - most unusual for Jan 1 as it's often 40 deg C and clear blue skies at this time of year. Especially unusual considering that we're been in a drought for the past two or three years and the main dam supplying Sydney's water is down to around 30%. Luckily some of the rain today fell in the dam's catchment area.

As soon as the weather fines up I'll start doing half an hour of laps in our backyard pool each day while I'm still on vacation. Until then I'm making do reading the health and fitness blog written by a fitness women which has some interesting posts. The most immediately useful one is the ten tips for starting a training program. Although some of the tips (such as "Live in an area that provides opportunities for physical activity") seem a bit extreme - I'm about to move house just to be closer to a gym!

This blog also has some useful tips on how to handle the constant challenge of eating out without ruining your diet. Although I tend to "brown bag" my lunch (a tin of no added salt baked beans (for fibre), a tin of salmon in springwater, and some "high fibre" bread) for both health and budget reasons, there is sometimes no alternative to eating out - especially if it's a business lunch with the boss.

Another interesting post was the tip to stay hydrated by drinking a couple of glasses of water after drinking a cup of coffee (as it is a diuretic). I don't drink coffee, but I drink LOTS of diet coke - I'm trying to cut back from a couple of 2L bottles a DAY, to just one 2L bottle lasting all day at work and at home with dinner. I'll make an extra effort to take a bottle of filtered water along to work, so I can alternate between the caffeinated drink and plain water throughout the day. Hopefully the reduction in caffeine plus the weight loss will get my blood pressure back down below the "borderline" readings I got last time I visited my doctor. Avoiding having to start taking blood pressure medication by losing weight and execising would also save a lot of money in the long run.

Anyhow, my weight is currently 99.1 kg (goal

Who knows. But, as this is the time of year when lots of people who should know better start to make wild guesses, I might as well have a bit of fun and put on my Nostradamus hat (at least I have no reputation to tarnish):

My PF:
- Although you ever know when the markets will tank, I'll stick with the herd and say that the total return for the Oz stock market won't be the 20% or so we've enjoyed for the past three years, but will manage a good 10% or so. This will help my retirement fund and geared stock portfolio to have another positive year (10-20% increase).
- I imagine that commodity prices will moderate slightly as Chinese growth is held to a more sustainable rate, and oil will stay mostly within a $50-65 a barrel band in '07.
- The Sydney housing market will remain subdued (0-5% gains), despite interest rates having peaked and possibly being dropped a notch or two during '07.
- The US stock market will gain a bit by the end of '07 (5-10%), so I wouldn't be surprised if my "little book" portfolio ends up with a slight profit by the end of '07.
- At this time I'm hopeful that my NW will increase by my target 10-12% (plus my $30K savings) during the year.

World events: Hmmmm, the crystal ball is a bit cloudy, but I'd guess that:
- Nth Korea is still resisting international pressures over it's nuclear program by the end of '07, and is trying to get financial and diplomatic concessions from the US.
- China continues to build up its military and holds some impressive military exercises to intimidate Taiwan. The US gets less and less supportive of Taiwan as it's economic ties with China increase.
- Fresh elections in Palestine by the end of the year see some progress towards an negotiated peace with Israel, but sporadic violence continues to make this a long-term proposition. [Unless Israel or the US bombs some nuclear facilities in Iran during the year].
- US, Oz, UK all increase troop numbers slightly in early '07, but it's not enough to improve matters in Iraq. By the end of '07 numbers are being reduced and coalition forces are fortifying green zones and bases for maintaining a long-term presence in Iraq "supporting" the Iraqi police and army. Monthly Coalition losses start to reduce towards the end of '07, but the de facto civil war continues with civilian deaths continuing to escalate.
- Lots of wars in Africa kill lots and lots of innocent people.
- Bird Flu and Mad Cow outbreaks make headlines a couple of times, but more people are killed on the roads each day in the US, Oz, and UK than die worldwide from these two in '07.
- After considerable debate and campaigning, regulations requiring labeling of cloned meat is enacted in the US. Meanwhile people continue drop like flies from smoking, alcohol and drug abuse.

I'll give myself a score out of 12 this time next year

Well, my financial goals are pretty well set and my asset allocation implemented - what actual performance I end up with this year is in the lap of the gods. So, the goals I'll be concentrating on most at the start of '07 are:
* using Quicken to track my daily transactions in detail once again [like I did before I got married, had some kids and suddenly had no spare time ],
* get my share transaction records up to date in Quicken so my capital gains tax calculations will be less onerous in July. It may even let me do some propoer end of tax year planning and run some "what if" scenarios.
* stick to my healthy eating plan (aka "diet") and get a bit more exercise, so I can achieve my ideal BMI by the end of June...

Aside from that I'll be busy this year doing a subject for my Masters in IT in the first half of the year, and starting my studies for a Grad Dip Ed in Secondary Science education - that will keep me busy! In the second half of the year I'm taking a leave of absence from the MIT course, as I'll be flat out with the Grad Dip Ed subjects, plus I have to do a month of prac teaching (for which I'll have to take 4 weeks annual leave from my "real" job).

It will be interesting to see where things stand at the end of '07.

Wishing all my readers season's greetings. Blogger has been playing up so I didn't get to post much over the holidays.

Well, maybe, maybe not. I've seen a few articles about the resources boom that hold the view that when the Chinese economy and World economy takes breather (next year?) commodity prices will drop back down to their pre-boom prices as new production (stimulated by the recent profitability of resources companies) comes on stream.

A contrary view is that exploration and development was at very low levels between 1998 and 2003, so the push for increased production has only just begun. Couple this will a typical lead-time of up to 10 years to get a new mine into production and the picture for commodity prices looks somewhat more rosey.

Today's Australian Financial Review also had some interesting facts about the concentration of commodity production - a handful of big resources companies control the lion's share of production, and therefore are in a good position to maintain high commodity prices in the medium term:

Commodity % output from big-5
Produced in each industry
Platinum 94%
Iron Ore 85%
Nickel 82%
Alumina 55%


I think I'll hold on to my BHP and Rio Tinto stocks for a while longer - especially as they've already come back considerably from the peaks earlier in the year.

I got an email from wealthcreator.com.au a few days ago announcing the launch of their "investment shop". The email included a $15 evoucher as a Christmas gift. So I checked out what was on "special" and found that the "The Bullseye Investment System, - Audio Tapes & WorkBook" was on clearance sale for $24.00 (RRP $240). After applying the discount this ended up costing me just $9.00 (there's free shipping on courseware, presumably because the profit margin is usually quite large on these products) - a 96.25% "saving".

The "Bullseye Investment System" course comes on 6 audio cassettes (my car doesn't have a CD player), so it will be good to listen to on the 1-hour drive to or from work. According to the marketing guff "The Bullseye System is designed to help eliminate poor investment choices, identify superior investment opportunities, maximize profit potential, minimize risk, and simplify portfolio monitoring."

My "Little Book that Beats the Market" Portfolio had a poor month, with several of the stocks dropping significantly. As my version of the "Little Book" strategy is to hold each stock for 18 months after purchase, then sell it and replace it with a new pick (unless its still in the short list), the monthly valuations won't really mean anything during the accumulation phase. Even once I start "rolling over" my holdings the annual returns won't show how well this strategy is performing - as it's meant to be a long term strategy. Hopefully after ten years I'll have some idea if it's achieving the target ROI of 15%. As this portfolio is being built entirely with borrowed funds, the ROI has to at least exceed the loan interest rate (around 8%) to be considered a "success" in the long run).

One reader has asked if this portfolio is hedged - the answer is "no" as I have no idea if the AUD will rise or fall vs. the USD over the long term (10+ years), and I'm not going to complicate things further by trying to guess the short term currency movements. Hedging without trying to actively "trade" currencies would just add another 1%+ pa to the costs of running this portfolio in the long term.

TRANSACTIONS THIS MONTH

BOUGHT: 300 shares in OMNIVISION TECHNOLOGIES [OVTI] on 13 Nov @ $16.47 - total cost USD$5,006.00 including $65 brokerage.

BOUGHT: 320 shares in EQIP SYSTEMS [EPIQ] on 11 Dec @ $15.65 - total cost USD$5,073.00 including $65 brokerage.

SOLD: No sale this month (portfolio is in accumulation phase - US$5,000 purchase each month for 18 months)

When selecting which stocks to buy I've been keeping clear of commodity (mining & oil) stocks as I think the "e" in their p/e rations may start declining within the next 18 months if commodity prices moderate as production increases meet demand.

PORTFOLIO PERFORMANCE:

I'm currently ahead by 6.86% (AUD$3,109.52) after deducting an additional $65 per stock holding for selling costs, but not allowing for loan interest expenses or dividends received.

Symbol 52-wk Range P/E Trade Shrs Trade Date Price Paid Commission Holdings Value Gain
HRB 19.80 - 25.75 24.95 23.55 200 28-Jun-06 24.16 130.00 $6,029.57 -286.18Down $286.18 Down 4.53%
MOT 18.66 - 26.30 12.35 20.71 265 24-Jul-06 18.98 130.00 $7,025.73 456.89Up $456.89 Up 6.96%
MSFT 21.46 - 30.23 24.13 30.19 200 21-Aug-06 24.64 130.00 $7,729.63 1,290.98Up $1,290.98 Up 20.05%
ASEI 36.03 - 93.86 26.89 65.81 100 18-Sep-06 49.51 130.00 $8,424.76 1,956.67Up $1,956.67 Up 30.25%
PWEI 18.15 - 38.16 4.32 34.75 150 13-Oct-06 33.29 130.00 $6,672.85 150.36Up $150.36 Up 2.31%
OVTI 13.45 - 34.49 11.09 14.49 300 13-Nov-06 16.47 130.00 $5,565.03 -890.42Down $890.44 Down 13.79%
EPIQ 14.31 - 23.40 8.52 17.02 320 11-Dec-06 15.65 130.00 $6,972.29 431.22Up $431.22 Up 6.59%
Total (AUD): - - - - - - - $48,419.86 3,109.52Up $3,109.50 Up 6.86%

nb. The average gain reported above is spurious as each stock has a different holding period, and the current prices have been automatically converted into AUD, while the buy/sell commissions I entered into Yahoo! portfolio haven't been converted. I'll start tracking ROI more accurately once I'm fully invested at the end of the first 18 months.

DW thinks I have a "gift" for spotting lost coins - whenever we're walking along the footpath and there's a coin lying on the ground, invariably I'm the one that spots the coin. Today I was throwing out some trash at the food court and spotted 25c change someone had left with their rubbish on the takeaway food tray. Another contribution to DS1's money box It got me wondering just how much loose change is discarded by mistake and ends up in the land fill every day.

I always love reading about a good scam - luckily I've never* been sucked in myself by one of these dodgy schemes, and the more of them you read about, the better you get at picking them. A good listing of some of the more common scams is here.

* Well, I did almost sent in some of my Paypal account details once in response to an phishing email - there are lots of emails purporting to be from Paypal that either request you to "confirm" your account details, "reactivate" your account, or pretend that your paypal account has paid some money to a company you've never heard of. In each case, they're just phishing for you account info. Unfortunately, these emails often look just like a real Paypal email, complete with the corrects fonts, content, layout, logos etc. and although you can often tell by the senders address, or the URL links to (such as http://paypal.dodgyco.com/paypal.htm) sometimes it's very hard to tell without some higher level internet snooping ability. These days I just ignore ALL emails that purport to be from paypal, which means I never get to read any newsletters or official notification emails. I really wish that email was NOT free - if there was a small charge (say 5c) to send an email, 99.9% of all spam and phishing emails would disappear as it wouldn't be profitable any more.

Well, today was my birthday. Overall it was an enjoyable day and fairly economical day. I had the day off work (my company gives everyone an extra day of "birthday leave" each year, which is very nice of them), and I spent the morning driving DS1 to an appointment at the Children's hospital for a check-up with his immunologist (he has food allergies and eczema). As the specialist consult and "skin-prick" allergy testing was all covered by medicare, this didn't cost me anything (Well, technically my 1.5% medicare tax levy paid for it). There will be some out of pocket expense for his latest medications, but not today

I had some bread rolls and turkey slices from the supermarket for lunch ($9.89) - but there's about half the turkey and bread rolls left over to take for lunch at work tomorrow, so it was fairly economical.

We then visited the Borders bookstore and browsed through a few books after lunch. My wife had a coffee and I ended up buying a $9.95 science book as another Christmas present for DS1, so this wasn't as cheap entertainment as it usually is. On the way home we dropped by my parents so they could say "happy birthday" and Mum gave me another birthday gift (a back-support car seat cover - at least it's useful). My parents had previously already given me a book, a 1oz silver coin (which I'd asked for) and an electronic knick-knack (a "joke master" - which I'll probably never use) for my birthday. DW gave me a wipe-off 2007 calendar as a token gift, which will also be of use.

Dinner was a pork fillet and some pumpkin, plus a couple more of the bread rolls from lunch. Next will be some free-to-air TV (Numb3rs and Survivor) before an early night (we have to leave early tomorrow for DS1's recorder concert rehearsal before school).

As my net worth has been bobbing *just* over the $1M mark this week, this is how a "millionaire" spends his birthday!

NCN did an interesting post that listed how much he had earned so far, and how much he could have saved up by now (if he'd saved 10% of his income every year) compared to what he's actually accumulated (starting a couple of years ago).

I thought I'd run through the same process myself, just for interest:

"How much money have I made during my lifetime."

Here are the details. I'm almost 45, and I've worked since I was about 14 (part-time during high-school doing a paper round, market gardening, storeman & packer and music tutor, and then during uni vacations working in a pencil factory). The breakdown:

Year Salary
1974 200
1975 300
1976 400
1977 500
1978 1000
1980 2000
1981 2000
1982 2000
1983 5000
1984 14000
1985 16000
1986 18000
1987 20000
1988 22000
1989 24440
1990 27926
1991 31985
1992 34695
1993 37678
1994 38509
1995 38924
1996 38924
1997 40481
1998 41695
1999 39047
2000 40286
2001 55714
2002 58093
2003 66261
2004 68249
2005 73602
2006 75810

These are rather rough estimates (but pretty close) for the early years. I got my first "real" job in 1984 working as an "engineering trainee" while finishing off my first degree.

So, how much money have I made, in salary, over the past 32 years? $935,719. Now, for some folks, that's not much money, and for others, it's a lot of money. Whatever you think about the amount you have to admit that it is a pretty decent chunk of change. To continue with NCN's method of analysis... Where would I be if I had SAVED 10 percent of my salary, at say 8 percent interest, per year. And how does this compare to where I'm actually at. Let's run the numbers:
Ten Percent End Of Year
20 21.60
30 55.73
40 103.39
50 165.66
100 286.91
200 525.86
200 783.93
200 1,062.65
500 1,687.66
1,400 3,334.67
1,600 5,329.44
1,800 7,699.80
2,000 10,475.78
2,200 13,689.85
2,444 17,424.55
2,793 21,834.53
3,199 27,035.67
3,470 32,945.58
3,768 39,650.45
3,851 46,981.46
3,892 54,943.77
3,892 63,543.06
4,048 72,998.46
4,170 83,341.39
3,905 94,225.78
4,029 106,114.73
5,571 120,621.02
5,809 136,544.75
6,626 154,624.51
6,825 174,365.37
7,360 196,263.61
7,581 220,152.18
At the end of the 32 year period, I would have had 220,152.18 in my retirement account. Not bad. Instead, I have about 304K, as I've been putting in more than 10% and have averaged more than 8% by investing in the "high growth" funds available in my retirement account. Now, for the sobering reality. Ready? If I NEVER put another dollar into retirement, but left that 304K to grow at 8 percent, how much money would I have in, say, 20 years when I'm ready to retire?

Over $1,026,000.

Yep, that's right. I've saved around 10 per cent of my income while working, and in another 20 years I should have over $1,000,000 dollars in my retirement account, without ever saving another cent.

Wow! Now, as you can see, I have "low-balled" my estimates. I assumed a VERY modest amount of savings, and a very, very modest rate of return, which is why I actually have 38% more in my retirement account than this model predicts. If I just stick with the conservative 8% return and don't contribute any more I STILL would have over 1 MILLION dollars in my retirement account. This shows how important time is.

In reality, I'm now saving around 20% of my salary into my retirement account and will continue to do so. Assuming I earn to same amount for the next 5 years and then take a pay cut when I take up a high school science teaching job, I'll end up with $1,401,207 at 65. The recent Australian tax changes mean that my retirement account earnings are only taxed at 15% and the final benefit, taken as either a lump sum or a pension, will be tax free. So this should be enough for a comfortable retirement. In fact, based on my current spending and the fact that I won't have a mortgage when I retire, I'll probably have more income than I need and will be able to increase my savings rate when I'm "retired". I suppose at that time I'll have to consider myself a "professional" investor. After I've completed my teaching qualification and Master of IT I may enrol in the Master of Finance course my wife is currently doing so I can officially call myself a "pro"

My other assets (around $700K) will continue to be invested in real estate and stocks, even after I retire, so this should provide a sizable estate for my two sons and their heirs. I've already set up retirement accounts for each of them, so they should end up with a comfortable retirement even if they never contribute anything to their retirement accounts.

It's amazing what you can achieve on a "modest" salary via a regular savings plan and sensible investments over the long haul.

Here's the regular round up on how the various PF bloggers who post Net Worth each month are progressing.

Leave a comment if I've missed yours out!
Monthly Net Worth of PF Bloggers for NOV 2006:

Blogger Age Net Worth $ Change % Change
Accumulating Money 2x $43,141.79 $2,732.33 6.8%
Consumerism Commentary 30 $67,376.57 $3,536.90 5.5%
Enough Wealth 44 $991,692.00 $686.00 0.1%
Financial Freedom 30 no Nov data no Nov data N/A
Ima Saver 6x $1,376,481.00 N/A N/A
It's Just Money 32 $152,126.94 $1,611.45 1.1%
Lazy Man and Money 2x $181,501.19 N/A N/A
Make love, not debt 2x -$74,995.01 $1,816.84 2.4%
Making Our Way 37 $613,426.28 $4,961.04 0.8%
Mapgirl 32 $33,602.00 -$921.00 -2.7%
My Money Blog 28 $119,111.00 $5,127.00 4.5%
My Money Path 29 $102,480.00 $2,220.00 2.2%
My Open Wallet 37 no Nov data no Nov data N/A
New Age Personal Finance 31 $142,106.77 $8,922.50 6.7%
Savvy Saver 27 $217,449.00 $4,130.00 1.9%
nb. Some ages have been adjusted as follows:
exact age provided = listed as given
"20's" = listed as 2x
"early 20's" = listed as 22
"mid-late 20's" = listed as 27
and so on.

Finally a new tenant has been found for our investment property - the rent was lowered back to the previous rate ($400 per week), so this means that we haven't raised the rent for a couple of years now. It's more important to have a tenant than hold out for an extra $10 a week. The new tenants have only signed a 6 month lease, but will stay on thereafter on an ongoing basis (4 weeks notice is required to terminate after the lease period ends). I'm hopeful that they may stay for several years as they have no kids (yet) and seem happy enough with the property and location.

My wife seems to have lost a bit of interest in being a "landlord" now that the property market has been stagnant for a couple of years, and because having no tenants for over three months was stretching our finances a bit. She was also a bit shocked by the costs of plumbing repairs and getting the place recarpeted and new kitchen lino last year (even though I meet all the "miscellaneous" costs of this investment - we just split the loan repayments 50:50).

The "experts" in the local papers are predicting rents will increase 5%-10% in Sydney over the next 12 months due to more people renting due to high property prices and a drop off in the construction of new housing due to the lack of capital gains in the past couple of years. We only just took out a 5 year fixed rate loan for the investment property last year (the variable rate is already higher than the fixed rate we got, so this will probably work out well for this 5 year term), so we won't be looking to sell the property for at least 4 years. Hopefully by then rents will have picked up and interest rates dropped a bit which should rekindle interest in property investment and trigger some price appreciation. The long term rate of price appreciation in Sydney is around 6% pa, so hopefully after two years of flat or decreasing prices, we may see a gain of 20%-30% from present levels by the time we want to sell the property in '11 or thereabouts.

If we do sell the investment property I'll be happy to invest in property via listed property trusts in future.

The free credit report I'd requested on 31st October still hadn't arrived, so I rang up Baycorp to check. After confirming my details the CSR advised that it had been emailed on the 9th November (funny how to free report which can "take up to 10 days" to send, was emailed EXACTLY 10 days after I'd faxed in my request). As I hadn't received the report I asked the CSR to check what email address they had sent it to - sure enough, even though my email address had been printed clearly in block letters they had managed to data enter a typo and send the report to some other address (Hopefully that email address is not in use by anyone - the password security on the emailed report is simply to enter my DOB, which I'm sure is available online somewhere).

As it was their stuff up, the CSR promised to immediately despatch a new report, and it turned up in my email about 10 minutes later. The end result was that ended up getting a free copy of the "premium" report (normally $27). There's not much to the report - as I haven't made any late payments there was only my current and previous address, and a list of 12 credit enquiries made over the past 5 years or so. It all looked pretty much as expected. I certainly wouldn't bother paying for this report.

I've been a fan of electronic bill payments (either using my CC on the phone or internet, or using bPay to direct debit my bank account) since it became available. But I must admit that electronic bills and statements have never appealed to me. Using free email accounts from netscape or yahoo means that there's always a danger that your emailed statements may disappear - especially using netscape, where your emails get deleted if you don't access your account for 30 days. Also, having to print them out to file them could cost me time and money - whereas getting the paper ones mailed to me costs them money.

So, as most electronic statements (dividends, bank statements etc) would be emailed to you I've always said "no thanks" - up to now. However, I may accept the electronic statement offer I recently got from ING. Firstly, they will store your statements on their site (permanently according to their ad), so I can access it any time via the 'net, and if my electronic statements ever went missing they should retrieve my data for me at no cost (since it's stored on their server).

The second reason is that they currently have a competition for converting to electronic statements - with three $2000 prizes up for grabs.

The past month ended up flat with good gains in my stock portfolio and retirement account being offset by a drop in the valuations of my real estate assets:
* Average property prices decreased, dropping my property equity by $19,155 or 2.60%,
* My stock portfolio equity went up another $21,865 (7.25%) and my retirement account also increased slightly - by $335 to $301,981 (up 0.11%).

My Networth as at 30 Nov now totals $991,692 (AUD), an overall increase of just 0.07%.

I doubt that I will break through A$1,000,000 before the end of this year - property could go either up or down, and my US share funds are getting impacted by the decline in the USD vs. AUD.

personal finance, investment, wealth, stocks, real estate, saving

A group of charities has banded together to recommend people use a free online financial planning program called MoneyMinded that has helped 15,000 Australians gain control of their finances. A recent evaluation by RMIT University found that 93 per cent of those who used it had changed their spending habits, drawn up a budget or made other positive changes.The charities are urging people to complete the program's 45-minute planning and saving course that showed how to make a family money plan. Among other things the program helps people differentiate "between items they need and items they want when shopping". Such education is desperately needed by low and middle income families - a recent survey of 400 Sydney families by Wesley Mission found almost one in four had never prepared a budget.