Roth IRA selected

In my efforts to get more money going into retirement accounts for both my wife and I, this week was spent doing a lot of research on what fit the needs of my wife and I the best. After visiting the IRA Online Resource Guide, and Fairmark's Guide for starting a Roth IRA, I formed an idea of how to approach opening up two accounts - one for my wife and one for me. Income limits are the same, no matter what company you choose to open your Roth IRA through. Since I'm opening this in 2008, I won't worry about 2007 limits. Because I'm concerned with my wife and I, I did not worry about single filer limitations either. If you make less than $159k, you're eligible. My wife and I fit into that category (for now), so I think even if we surpass that in the future, I'll be able to have money in an old-age "Rainy day" account. Each account is restricted to a maximum of $5,000 per year, unless you are 50 or over. If you're over 50, you cam make additional "catch-up" contributions of an additional $1,000 per year. The companies I considered and on whom I performed research were:

American Century
e*Trade
Fidelity
ING Direct
Schwab
T. Rowe Price
TD Ameritrade
OptionsXpress
ScotTrade
Vanguard

I'm sure I missed one or two, but I made sure I checked with at least the four with whom I already have accounts and offer a Roth (e*Trade, Fidelity, T. Rowe Price). I also have a 401(k)
with ADP, but they do not offer a Roth IRA.

I did not have extra money to open an account, so that eliminated a few of the companies. I didn't want to start out contributing a ton of money, thus reducing the amount I contribute to my own company's 401(k) because that has tax implications of which I may not be aware. I'll be spending some time researching the options I have before me. So, for now, I selected a company that had no minimum to open the account and no fees if I contributed at least $50 two times per month. The minimum is what I am doing, but I do expect I will be able to increase that to the maximum within a few years. For now, it looks like my wife and I will have at least $1,200 each in a Roth IRA by the end of 2008!

2008 Goals

My goals for the upcoming year are simple.

1. Pay off all credit card debt. Currently my family is at about $2,500, which isn't that bad, but it's the last of about $15,000 from 6 years ago. We've been living like paupers for the last 6 years in order to pay it off. Once we get it paid off, we will not be falling into the same trap of charging when we don't have the money. I know it sounds simple, but it was such a bad trap to fall into. I say trap, because I truely believe that credit card companies trap consumers into high card limits in order to get them to spend beyond their means.

2. Establish Roth IRAs for both my wife and I and fund them both with regular bi-weekly contributions. The total goal is $2,000, $1,000 in each. I've read that once the company match is maxed out, one should put all the rest of the retirement money into a Roth IRA. The only restriction is that for my income bracket, I can put in a maximum of $5,000. For the first year, I'm going to keep my current deduction at 12%, but I turned off the automatic increase. I started at 6% (the company match) when I started working for my current employer, and have increased my contribution by 1% each year I have worked for them. The only real decision is what broker I open the account with. I'll do some research over the next week to determine what my options are.

3. Increase our savings account from the current $500 to $2,000. With all the other financial efforts, I don't want to set my goal out of reach, but this will be the first year I have an actual goal for the family.

4. Post a new blog at least twice a week. Most will be financial. Some may be about life in general.

Well, there they are. I hope I can keep on track, and I will pick up some readers along the way. Maybe that should be another goal - promote the blog. But, I think eventually something will pick up and people may start reading.

First step - Organization

In order to assess my family's financial situation, I needed to get an accounting of every bill I have and how much I owe. I'm using a few tools found online:

• mint.com - Online money manager/budgeting tool. This site, although scary in the amount of information centralized, is pretty good for giving a person a single website for aggregating all accounts.
  
• networthiq.com - A simple tool that allows one to enter the general finances on a monthly basis. It's not perfect by any means, but it is one of the better financial tools for what it does on the internet.
  
• google.com - I have a google account and have a tab with every single company with which I have an account (credit cards, bank accounts, retirement, stocks, etc.), the Google calendar widget (to allow me to keep tabs on when my bills are due, in addition to Mint) and some of the financial websites I read frequently.
  

I've spoken with my wife about our goals, and while I know she wants to be debt free with a good credit rating as much as me, she does not feel the need to actually plan for it like I do. She would rather argue about it, which is one reason I've set up a Roth IRA for both of us, funded with a minimum amount of money ($50 bi-weekly). She has a state funded retirement plan (she's a teacher), and I have a 401(k) at both my full-time job (6% matched, funded by me to 14% - more on that later) and at my part-time job (4.25% matched, funded by me at 20%). I have a part-time job at a home improvement store, and don't really think that I'd miss the extra $15-$20 I put in each pay period.

I've also been thinking about what my family needs to accomplish, and really the reason I'm posting this online. I think putting this out there for people to read may keep me more focused on actually accomplishing my goals. I don't have much in the way of credit card debt (less than $2,000), and will have that cleared in the next two months. My real focus is on budgeting, retirement, saving for my kids colleges (I have two girls, 12 and 8) and improving the credit scores of both my wife and I. I own the car I drive, we just purchased the car my wife drives, we have a third car that I drive only during the summer (a 1973 VW Bug that my mom and dad bought in 1973), we own our home, and would like to get a vacation property. I'd like to put an addition on to our home to give my wife and I more of a master suite - my wife takes up our spare bedroom with all of her clothes and our bathroom is so small that getting ready in the moring requires a bit of planning so we're both not in the bathroom at the same time. My wife isn't sold on the idea, but after seeing a friend of mine put the same type of addition on his house (added a master bedroom above his garage and family room), she is starting to think it might be a good idea.

I'll have my financial goals posted by Saturday of this week (1/5/2008) for 2008.

Start of something new

One of my resolutions for 2008 is to be a complete financial leader for my family. We've had many false starts on the road to saving money, eliminating debt and increasing our credit score, but I think I've established some basic activities (401(k), employee stock purchase plans, savings account) and organized all my recurring bills (heating, cable tv, telephone, etc.) that will give me the motivation to continue working towards financial stability. I hate waking up each day thinking that I've forgotten to pay something, knowing that my credit score is horrible, or some other malady that is affecting my life and the life of my family, so this is where I will concentrate my efforts to get my financial situation straightened out for once and for all. With the use of some tools widely available on the internet and my own sense of what sort of spending my family should be doing, I will resolve to have the family finances cleaned up this year.