2009 in Review

So much has happened for our family this past year that it's been hard for me to get my bearings.  But what an awesome year it's been!

We put our old house on the market at the very end of March.  We welcomed Colin into our family (by c-section) in July, which was also abdominal surgery for me.  If you consider the $3,500 out of pocket AFTER insurance, 1 month unpaid leave for me before Colin was born and 3 months of unpaid maternity leave (about $4,000 of net pay), our cost was approximately $7,500...and that doesn't take into account the shift differential that my husband lost when he took 4 weeks of paid leave.  All the while, we kept our house model-like and showed it multiple times.

We went under contract on the old house in August and found our new house and went under contract on it a week later.  Our new house originally listed for $309,000, but was on the market for over a year and we got it for $252,500.  We then faced the daunting task of packing the entire contents of the house and loading it all into a large U-haul truck and trailer ourselves (with the help of our AWESOME friends!)   We closed on both houses and moved into the new house on October 6th...again, with the help of our wonderful friends.  Talk about busy!  We were so lucky to have bought the old house in 2004 before the prices shot up.  We paid $153,100 back then with a 100% mortgage (nothing down) at 5.21% with a 7 year ARM.  Even during the worst housing market in recent history, we were able to walk away with $50,000 after paying the realtors' commission.  We were very lucky.  We ended up putting $50,500 down on our new home...20% down in order to avoid PMI.  We also got a 30 year fixed mortgage at 4.875%.  Now, we've stepped up from a 1710 sq. ft. house on 0.16 (yes, less than 1/4) acres, to a 2490 sq. ft. house on 0.81 acres...and our mortgage payment is just $300 more per month.  We love our new house and we're so happy that we'll be able to give our boys a childhood that has many similarities to our own.

Yesterday morning, I had my biannual meeting with my awesome financial advisor.  Even after the beating we've all taken in the market lately, the balance of our accounts is higher than before the recession.  Woo hoo!  That's a relief.  When we met with Stu when we were pregnant with Gavin, we decided that, since we were ahead of the game as far as retirement savings were concerned, we would be able to afford not to contribute while I stayed home with the kids...assuming that when I go back to work full-time, I'll be able to max out contributions to get back on track.  Well, since then, we've been able to contribute 4% which is enough to get the company match.  This is more than we had planned and it helped us weather the economic downturn, because we continued to buy while the market was low.  I just wish that we could have contributed more while the market was low. 

In order to avoid layoffs, my employer has temporarily stopped matching our 403b contributions.  When I asked Stu what we should do, he suggested that we stop our 403b contributions only while there is no match and instead, contribute the same amount or more (when possible) to our Roth IRA.  So, starting yesterday, we're contributing $120/month into a Roth IRA.  I wish that we were contributing more, but with only 1 full-time salary and me only working 4 days/month, we are tight right now. 

Our plan for the next year is:

1. Have our wills drawn up (I keep kicking myself for not doing this sooner!)
2. Build our savings account (emergency fund) back up to $15,000.  It's at an anemic $3,500 right now.  This includes having taken $3,500 out to pay for installing a fence and gutters on the house.  
3. Any tax return will be deposited into the savings account.  I'm expecting $3,000 to $5,000.
4. Adjust our w-4's to withhold less for taxes.  We're getting WAY too much back!
5. Continue to contribute a minimum of $120/month to the Roth IRA.
6. Any additional money will get split between the Roth IRA and the savings account.
7. We will continue our $350,000 (30) year term life insurance policies (each).
8. My additional $150,000 (10) term life insurance policy is up this year and I need to decide whether to get a new term policy or start a universal life policy.  This extra amount on me is due to the fact that, when I work full-time (which I intend to do again when the children are both in school), my husband makes 2/3 of the hourly rate that I make.
9. Stu is adjusting the allocation for additional contributions made to our Roth IRA.

I really hope that we are doing enough saving.  I truly believe that the best thing for our kids is to be raised by a parent instead of a childcare provider.  I want my kids to have the same start in life that we had.  This is the most important priority at this time.  However, I would hate to find out when we try to retire (or pay for college) that we didn't do enough.  I'm putting my trust in our financial planner and doing what I can today.