Author Archives: Ginger

networth re-calibration

After much thought, I decided to re-calibrate my networth. It is a painful move because my networth heavily benefited from the equity of my condo but I was using the number provided by Personal Capital which is powered by Zillow, and I have seen wild swings (we are talking +/- $50k). I recently refinanced so I decided to use the appraisal value quoted for the refi. It pains me to see the value drop so much but I would rather be conservative in estimating my wealth than too liberal.

Hopefully this is the only huge networth decrease I see this year… 🙁

credit report correction process – part 2

I researched further and found that while the collection agencies are required to authenticate the collection within 30 days of receiving the letter from the consumer, this is only applicable to those instances when the collection agency sent the letter to the consumer first. In my case, I never received the letter so my 45 day period to contact them had passed as far as they were concerned. Due to oversight by lawmakers, when collection agencies receive request to authenticate outside of the dispute period they cannot call me to collect but legally they do not have to provide any authentication. They can sit on my letter and have the collections still show up on my credit report for as long as they want.

This put me in an uncomfortable situation where it looked like my options were to either 1) pay the collection or 2) hire a lawyer to dispute. While I would like to hire a lawyer based on principle, I imagine that would be thousands while the account in dispute is < $1k. Especially since I would like to get into real estate investing, having the collection remain on my account was not acceptable.

I decided to give it one more attempt before calling the lawyers to see how much it would cost. I went to the Better Business Bureau and filed a complaint through them. BBB clearly states that they do not deal with credit report related items, I submitted it as a customer service issue and that the issue isn’t the credit report but the agency’s refusal to provide more information. I attached my original request letter and the certified mail receipt again to my complaint.

2 weeks later I received a response from BBB, which had a letter from the collection agency claiming that they no longer own the debt (my guess is that it got sold to the collection agency that promptly responded to my request) and provided me with a contact number of their compliance officer. I gave them a call, recapped the process, then asked when the item will be removed from my credit report since they admit to not owning the account. I was given a story about how it was a system glitch with Experian and that they have submitted a request to all agencies asking for the item to be removed from my account. I say “story” because they are claiming the glitch happened on January 2015 and I can’t imagine they let the glitch remain for 1.5 years. Also, when she gave me the confirmation number of their request for removal, I was told to give the agencies the conformation number and tell them that the letter was sent the day before my call.

I sent the copy of the letter to Experian on my dispute and summarized they admit to not owning my account. Now, I have to wait and see if this finally gets me anywhere.

I am still shocked by this entire process. I can’t believe 1) the law allows collection agencies to never send you proof of the collection and 2) all Experian does with a dispute is ask the collection agency without performing their own research into the issue. It feels like this process protects the collection agency more than the consumers.

 

 

 

credit report correction process – part 1

My advance apologies. I didn’t mean for this post to be so long but I want to tell my story in detail so that it can help others if they are in similar situation.

While pulling my credit reports from the various bureaus to check my score, I saw two items I did not recognize in collections. The two items were for the exact same amount yet under different companies. When I googled the companies, I found out that they were collection agencies.

I started to look at online forums to determine my next steps. I learned that I could send a certified letter (to prove receipt) and request information to determine authenticity (of the debt itself and also that the said agency owns the debt) to be sent in 30 days. The burden is on the collection agencies to prove authenticity.

I found a template letter asking for additional information, altered it to my liking, then sent it off to the two collection agencies. Within 2 weeks I received a letter back from one collection agency stating that they will send a request to remove the collections from all three bureaus. Within days that item was removed.

However all I received was radio silence from the second collection agency. After 45 days, I decided to dispute it with the bureau (Experian), hoping they can help expedite the situation. I detailed the dispute using their online dispute form and then used the separately provided link to upload the copy of the letter I sent as well as the signed receipt form.

In two weeks I received an email stating that there was a decision on my dispute. When I logged on I saw that one dispute was ruled in the collection agency’s favor and there was another dispute with the decision pending. Out of confusion I called Experian and was told that when they received the dispute on their website, they contacted the collection agency who said that the collection was still active, hence the decision in the collection agency’s favor. They opened a second dispute when they received my uploaded information (there appears to be a significant delay with uploaded documents).

I asked the person on the phone how it was they ruled in the collection agency’s favor when I still have yet to be provided with supporting documents. I was told that all that Experian does is contact the collection agency and ask if the account is active and nothing further. They will not assist you to receive more information. I was flabbergasted. What was the point of filing a dispute with the collection agency then?

cost of flakiness of others

This week is turning into an expensive week due to flakiness of others.

On Monday, I had a meeting with folks who are generally difficult to get a hold of. I had promised them sugar as an incentive to attend the meeting. Just as I was checking out at the gourmet bakery nearby, I received the meeting reschedule notice moving it to Tuesday. At this point I had already paid and gotten the items wrapped up, there was no way I could return the items. I ended up sharing them with my team.

Today, I was supposed to go to lunch with my mentor at work. It has been on our calendars for the past week. I almost brought my lunch today but didn’t when I remembered that I was meeting up with him. He ended up getting caught in a meeting and canceled. I had to go out and buy my lunch today.

I still have business days left for this budget period (I put money into the various categories 2x a month) and I have already blown my work budget for things that didn’t even take place. I get that I would have blown my budget anyway if the events occurred but there would have been advancements in the project and career. I am now out of cash and, since the lunch has been rescheduled, I will go even further in the negative on this category.

It isn’t the end of the world and I can move my cash around to make it work until the 15th. It is just irritating.

money & relationship

Although JA and I have been together for 2 years, money is an uncomfortable topic for us. The discomfort comes from the fact that while I am 5 years younger than him, I make almost twice as much. He also has student loans that is larger than my mortgage.

JA funded himself through college, law school, and graduate program. He took some time to figure out what he wanted to do as a grown up so his career started about the same time as mine. I admire that he has no other debt but it makes me utterly uncomfortable that he his student loan debt is close to $200k.

For now, it is fine. We live at my condo and pay much less than we would rent. Our finances are separate except for the joint expense account. But I don’t think it will be fine in a couple of years. We talk about having a kid in a couple of years and it will be impossible to raise a kid at my condo so we will need to move. Since rental market in Chicago is crazy and I want a real estate portfolio anyway, my preference would be to purchase. I think it may be easier for me to get approved for a home by myself than having him as the joint owner. We will also have childcare expenses. And that’s only the short term. I fear it will only get worse as we add kids and we get older.

I love him and I sympathize with his situation. At the same time, it isn’t really fair for me to be so impacted by his finances. I don’t come from money and I have worked hard and have made shrewd financial decisions to get me where I am today. And this stresses me out more so than anyone could imagine. I have always been the person who ends up shouldering other people’s burden and cleaning up the mess and I am trying as hard as I can to let him handle it on his own time.

Are you in a relationship with a large financial gap? If so, how are you managing it?

current cashflow & budget

Since I have shared my long term goals, I think I need to explain why I think this is feasible by telling you about my current situation. Since this is anonymous and I intend on keeping it that way, I can share the details with you.

I earn $185k base and qualify up to 12% for bonus and receive 10% in profit sharing on salary + bonus each year. I contribute the full $18k a year to my 401k since that is a good practice and also to lower my tax rate. In all, I expect my employer to put ~$20k in my retirement account this year. I also have contributed $5,500 into my IRA, which is in the process of being converted to ROTH IRA.

After 401k contributions, employer sponsored benefits, and taxes, I take home ~$8650/month. I have withholdings set high enough that each year I receive a significant amount in tax refunds. While I can change the withholdings so that my paycheck is higher each month and I receive less in taxes, I would rather receive a lump sum than to risk owing.

From there, I break it up into various categories of spending.

Expenditures MONTHLY
Joint Spending  $1,750.00
Cell Phone  $80.00
Gas/Transportation  $75.00
Audible/Books  $20.00
Dog  $500.00
Spending Money + Food  $450.00
Work Related  $50.00
Student Loans – 0%  $200.00
Student Loans – Interest  $800.00
House Maintenance  $100.00
Travel  $400.00
Gym  $130.00
Gifts  $100.00
Investments  $4,000.00

My boyfriend (JA) and I live together at my condo. We have decided to create a joint expense account and items such as my mortgage, HOA, groceries, and house cleaner come out of that account. I debated whether it  was fair for JA for us to do it this way since the condo is building equity, but I have decided it is fine since renting is much more expense than my monthly mortgage + HOA.

The dog came with me so I am responsible for his expenses, although JA takes care of him as well. Because I can work crazy hours, I have a dog walker that comes 1x a day during weekdays and whenever we are out of town he gets boarded, hence the high dog cost.

As you can see, my only debt (aside from the mortgage) are my student loans. One is at 0% interest so I have no incentive to pay it off early, but the other is at 6.5% interest. I have more than enough cash on hand to pay it off but I stress out a lot about parting with that much money at once. I pay much more than the minimum amount and the goal is to knock this off in about 2 years while still hoarding cash.

Now you know the dirty details of my finances. Every couple of months I reassess my spending and try to lower the monthly spend allocation if possible. While I am sure this is more than what some people with families spend, everyone’s situation is different and this is what works for me. I am excited to hear any suggestions anyone may have to reduce the budget even further.

 

what is so magical about $1MM?

To be more specific, my goal is to hit $1MM within the next 10 years, allowing me to retire at the age of 43, although ideally I will retire by the time I am 40. I want to have at least $500K in retirement accounts so that these are able to grow for 20+ years and have passive income of $4K a month, most likely through real estate.

I doubt that I would ever fully retire but, once I hit this magic number by that age, I will be free to take less stressful jobs and worry only about breaking even each year. I can decide to work full time or just stay at home with the kids.

Independence is one of the things I value the most and, for the first time ever, I am in a position where I can’t confidently walk away from a job knowing that another similar one is around the corner. While I can probably find jobs with the same titles and responsibilities, I have found that I am out of the pay range for most of those positions. I am golden handcuffed to my job. I love my job but the stress can be very intense, to a point that it has impacted my health. I am hoping to spend the next few years building the team so that I am able to have less stress but that may just be a lofty dream.

Here is to beginning that journey. I am happy to have you follow along.

the point of it all

Why am I starting this blog?

I have stared at that question for a few minutes now. The fact I am unable to answer it quickly shows the struggle. I feel like I want things to change but I am not sure how to bring change.

On paper my life sounds great. I have a grown up job at a reputable company, making grown up money in a lady boss role. I love my team, the work that we do, and the results we deliver. I love my boss although sometimes she drives me crazy. I live with a sweet boyfriend and a cuddly puppy. I have my own condo in a bustling part of town. I shouldn’t be so lost but here I am.

This may be just me getting on a bandwagon, if you will, with the FIRE (financial independence retiring early) movement. But I can see me burning out. The person who constantly would think and plan her next step of her career doesn’t want to do that anymore. To sound very anti-feminist, I want to have kids and be a hands on parent. I can’t do that if I am working the hours I work with the same amount of stress.

I am tentatively setting a goal to give me the option of FIRE within a 10 year time frame. I am sure this is laughable to those who achieve it in lightening speed. But I am very risk adverse and I have determined my FIRE number to be $1MM net worth.

This blog is to document my thoughts and journey to that magic number.