I sent the final payment for our heating fuel in the mail this morning. It was all paid in 30 days. The fuel company charges 2% per month for anything over 30 days, so that was avoided by 4 days.
It's nice to see our bank account at such a high level, even if it is only for a couple of days. We have several payments scheduled on the first day of the month, including mortgage, insurance, and most of our CC payments.
So, on Thursday, the amount of money in checking will be much less, but it's nice to live a fantasy for a couple days.
Archive for January, 2012
Well, I'm not makingthe trip. DW is. The office is about 45 miles away, and she's packing up all four kids, so she can get a new SSN for DS1.
We got his ne birth certificate in the mail on Friday. That's the last piece we needed for a new SSN.
As I mentionedin a prvious blog, we can account for at least five adults who may have had access to his existing SSN before he came into our care.
The new SSN will allow us to protect him against future identity theft, and also allow us to claim him as a dependent on our tax return in future years, without fear that someone else will claim him.
We got a wonderful surprise in the mail on Friday. A refund on overpayment to our mortgage escrow account. $368!
That will sure come in handy.
Of course, we've had to pay into that account because of underpayments in the past.
We ended up filing our taxes as if DS 1 didn't exist. We'll now wait for the refund checks and the new birth certificate before we pursue the rest of our refund/adoption credit with IRS.
I just checked my checking account balance. It's +$900. Not bad for the end of the month. Actually, it's pretty darn great. We still have our van payment to make before the end of the month, and we still owe $300 on our heating fuel. So, we'll end the month about $400 to the positive. That cash will go toward CC4.
If we get our reduced income tax refunds (state and fed) in the next two or three weeks, the opressive CC4 balance will be history.
That, my friends will be cause for a (no cost) celebration! Then I will start with much vim and vigor to tackle CC1.
DW e-filed our taxes late yesterday morning. Then she checked the status of our e-file at around 9:00 last evening. She found out that our filing had been rejected. The reason for the rejection was that someone else had used DS1's name and SSN as a dependent. DS1 is our son whom we adopted last month.
Before DS1 came to us as a foster child last April, at least five different adult people probably had access to his SSN.
We provided care for him for 8 1/2 months in 2011. We meet all qualifications to claim him as a dependent.
I guess the bottom line is that this will slow our tax refund down substantially. We will need to now file the old fashioned way, and prove our case. While I was really counting on the money, it will eventually work its way out.
I got my W-2 in the mail last Friday. So, we bought Turbo Tax, and got started. DW did the data entry. We couldn't complete them because we still need to know what we spent on mortgage interest last year. We don't itemize, but we do use the mortgage interest as an expense against our rental.
DW plugged in an estimate, and we'll have about $4,800 in federal refund and $900 in state. Plus, of course, the adoption credit.
I did some figuring on the credit card balance that I transferred today. That would be CC4 with the $1416 balance. As long as I pay the balance off by this April, I will be about $60 ahead, compared to not doing the balance transfer.
One way to look at that is - sixty bucks is sixty bucks - the balance transfer was a good thing. Another way to look at it is - Was the hassle worth it to save sixty bucks, or about $6.66 per month over the nine months? My final verdict is that the hassle was worth it. It wasn't really much of a hassle anyway.
Sixty dollars of avoided interest is sixty dollars that went somewhere else. Ultimately it has decreased our total debt load. But, I would feel more victorious if the number were a bit bigger.
The only factor I'm not totally sure about is affect on credit score. I've heard that the credit inquiry associated with opening a new CC dings your FICO score about five points. I also know that having a credit card with a low utilization ratio improves your score. This is a $5,000 limit card, and less than 30% of it is utilized. I hope that the utilization factor has improved my score by more than the 5 point ding. I'll go with that assumption, anyway. So, that coupled with the $60 savings (again, as long as I get it paid off by April), it was a good decision.
For the month of January I will spend each day -
$2.48 on credit card interest
$3.16 on credit card plus auto payment interest
$20.65 on credit card plus auto payment plus mortgage interest.
I've been calculating these values for, I beleive three months now. My jaw still drops each time I calculate them.
In one of my very early blog posts (last April)I described different "personalities" that I envisioned each of my credit cards having.
I described CC4 as a sort of an imp or a gremlin. He is green with a sinister smile and razor sharp teeth. He jumps around a lot and chews stuff up and just plain creates a mess of things.
Since that original post, I have transferred the balance to a new credit card. It has had a 0.0% interest rate, that will baloon to 20.99% in February. The balance is now 50% of what it was in April. So, now I envision the same little gremlin, only I've knocked out about half its teeth. But, it's regaining strength, and is becoming ready to reign more terror on my finances.
I described CC2 as a slow moving giant with a big club. He kind of swings that club around a lot and crushes my finances.
Something signifiant has happened to that card since April - the interest rate dropped from 12.9 to 8.9%. The balance is 87% of what it was in April. So the "giant" (principal potion) is nearly as big as it was 9 months ago, but the club (interest portion) has decreased in size and damage causing potential quite a bit. But, it's still a pretty big club!
In April I wrote that CC's 2 and 3 have lower interest rates - in the 5% range, They are like two overgrown, clumsy kids, kind of tripping on things an knocking stuff over, but creating spills that I can tend to. I'd just rather be doing other things with my time (or money) so to speak.
Nothing has changed on the interest side. CC 3 demands a higher monthly payment, so the principal has dropped accordingly by 49%. So it's more of a toddler now, rather than a clumsy overgrown kid.
We took the boys to the University of Michigan hospital in Ann Arbor on Thursday. Ann Arbor is a 2 1/2 hour drive from our remote, rural home. The appointment was at the U of M Fetal Alcohol clinic, and it took us 7 months to get in.
We arrived at 7:40 AM. The appointment started promptly at 8:00, as scheduled. We left at 2:10. In between, we consulted with six medical professionals, including a genetics team, fetal alcohol diagnosticians, and a child psychologist. The boys also had blood drawn for genetic testing.
While we won't have the complete reports for another couple of weeks, we did learn that DS2 indeed does have Fetal Alcohol Syndrome Disorder, and DS1 does not have FASD, but he is in the Autism Spectrum.
Sad, yes. Actually, I was (am) angry at DS2's biological mother, and DS1's biological parents' neglect almost certainly, in my mind, any way, caused the autism. But, we've known something is different about each of them for a long time.
So, we take the information that we've learned, and will learn, and use it to provide as close to a normal life as we can for these boys.
The seven months was worth the wait. The staff at U of M was exceptional, and the entire process, while there, was carried out with amazing efficiency.
House 1 $80,000
House 2 $73,000
Autos (2) $7,580
Total Assets $250,411
House 1 $103,771
House 2 $70,000
Accounts payable - $746
Total Liabilities $194,007
Current net worth - $56,404
Net worth last month - $54,224
Change compared to last month $2,180 to the positive.
A bit less than half of that change came from decrease in debt obligations. Checking is up a bit. Retirement is up a bit.
I just found out that for 2012, the currently refundable adoption credit decreses from the 2011 value of $13,360 to $12,650 (I already knew that), and it it reverts back to a nonrefundable credit (I didn't know that).
Of course, congress can change any of the above facts any time between now and the end of the year. And it's an election year, so we'll see.
I'm just glad that one of our two adoptions was made final in 2011. Because, as it stands right now, that's a $710 difference.
I paid my winter property taxes. I think the bill was $328, but I don't remember exactly. Somewhere between $320 and $330, anyway.
We live in a very rural area, and taxes are cheap. I think the summer taxes were just around $200.
Our taxes for the other house we own run about $1,400 per year.
I also ordered fuel oil today for the house. Last time we filled up it cost $750. That lasted October, November and December. January and February will be colder, so we'll see how far this fill-up lasts.
The bill won't be due until after I get paid again (I get paid monthly, at the end of the month). So, I should be able to float the fuel oil bill (or most of it, anyway) with my next pay check.
But, it's likely we'll need another fill-up before March. Hope for warm days!
Here's my beginning of the year debt update:
Mort 1 - $103,771
Mort 2 - $70,000
CC 1 - $7,731
CC2 - $2,453
CC3 - $1,716
CC4 - $1,416
Van Loan - $6,174
Total principal paid as compared to one month ago: $936
That's short of my $1,000 monthly goal. Well, $64 short to be exact. But, I've already written about our holiday spending, so not too bad.
I will continue to concentrate on CC4. That's the one that was transferred to a 0.0% for 6 months card. February will be the final interest free month. Then it shhots up to 20.99%. We'll pay it off when we get our tax refund, but until then, interest will accumulate mightily.
DW and I became licensed foster care providers in Feb. 2010. We received our first placement in March 2010. We picked the three week old infant up at the NICU. He never spent a night with his bio parents. His bio dad is a convicted child abuser and a sexual deviant. It turns out that he beat the hell out of bio mom late in the pregnancy - thus the need for the stay in the NICU and the subsequent Cerebral Palsy diagnosis.
One year later - after twice weekly visits with bio mom - both bio parents signed off on their parental rights. You see, bio dad was facing fresh criminal sexual conduct charges, and he felt it was in his best interest to sign off. He convinced mom to do the same. The CSC charges were against her children from a previous relationship.
In April 2011 we had a 2 1/2 year old placed with us. His parents are drug dealers. He was found in the van with them when they were busted selling drugs. He was also criminally neglected. This is the child we just adopted.
We receive an approximate $1,200 stipend each month from the state of Michigan to care for these children. We receive more for the (now) three year old because his needs are greater. In addition we receive WIC benefits to purchase food. The value of those benefits are about $60 per month. Cost for diapers, clothing, car seats, visits with bio parents, etc. come from the $1,200 payment.
DW has been generating about $10K per year in freelance income since the birth of our first child. She no longer has time for that.
Payments for children are based on the complexity of their level of care. Level 1 children are your run of the mill children in the foster system. Our youngest child is currently a Level 1. Level 2 children require enough counseling or other types of specialists appointments and specialized care in the home to increase payments by $5 per day. Level 3 children may have explosive behaviors, or require increased counseling to receive yet another $5 per day. Our three year old is classified as a Level 3. The final classification is "Medically Fragile". These children require constant or near constant medical attention. I've heard that payments for these children can be around $50 per day.
We (mainly DW) are working to get our 21 month old re-classified as a Level 2. Level 2, 3, and Medically Fragile adopted children retain payments until they are 18. Level 1 children retain no payments post-adoption. We feel the CP diagnosis is enough. The State of Michigan disagrees. Fortunately the Judge agrees with us, and he is being re-evaluated. Hopefully adoption around his second birthday.
The final financial benefit is the $13,000 per child refundable tax credit.
I understand that not everyone is cut out for foster care. But there is a tremendous need. Heck, we're not cut out for fostering adolescents, at least not right now. We've heard horror stories about foster parents having their car stolen, or being threatened with knives, or darn near having their house burnt down. The bottom line for us is the safety of our young children, so we won't be fostering teens for a good many years.
We've fostered three other children during the past two years - each of them short-term placements.
If you have any interest at all in learning more about foster care, feel free to reach me at my personal email address - email@example.com.
We adopted a three year old little boy through foster care this last Friday. He's been living with us since April 2011. He had a REALLY tough past - almost as tough as you could imagine from a neglect stand point.
He will likely be mentally and emotionally scarred for the rest of his life.
The adoption of a special needs child through foster care includes a $13K refundable federal tax credit (see my related post in the SA forums).
The tax refund is meant as an incentive to get these children into safe and loving homes. We would have adopted without the tax credit, but it sure is nice.
If anyone is interested in learning more about foster care or adoption through fostering, feel free to PM me through my SA account.
It's tough, hard, work through a bureaucratic maze. But there are 20,000 children in Michigan alone who need safe, loving, nurturing homes, or just plain a chance in this world.