Sunday, February 24, 2013

I’m on Board with Silver…Are You?

I’ve been seeing a lot of articles online lately regarding the popularity of silver. One in particular entitled “Silver Coins in Demand” from a North Dakota news agency recently caught my attention. It got me thinking about some of the things that are affecting the physical silver market lately. According to the article, "North Dakota people are buying silver at record levels the last two years.”

I’m jumping on the bandwagon too. Actually, I’ve been ahead of the curve on this trend and am content to ride along with it for a while. Recently I bought the kids a few of silver coins for the holidays, as did my mother.

Here are some of the reasons why it appears silver is becoming so popular as of late.

Economic Uncertainty
While things look okay at the moment, there is still plenty of economic uncertainty out there. The job market, Europe, the nation’s deficit and budget woes, inflation possibilities, housing, welfare, Social Security, Medicare, and more add to this uncertainty.

Metals and commodity investment can often be a good option at times of economic uncertainty. And while lately, the price of silver hasn’t been doing much, it’s often a strong hedge against things like inflation. While the Fed continues to pump money into the system, I look at silver as a strong asset to hold to help counteract some of the effects of this money printing. If the Fed is looking to push people toward risk by way of this monetary policy, I think that putting money into silver rather than the stock market is a smarter and less risky way to put money to work in a long-term investment that can be a tangible asset as well.

Lack of Supply
I’m a strong believer in the law of supply and demand. When there is less of a desirable commodity, its price tends to go higher. When I see things running out, like the supply of American Eagle Silver Bullion coins sold through the US Mint, forcing them to temporarily suspend sales in January of 2013, it tells me that demand is hot and supply might not be keeping pace. To me, this is a strong indicator of investor sentiment and one that I’m not willing to ignore.
While the price of silver is up significantly over the past decade, it is still largely affordable to the common investor. At around $30 an ounce, and easily purchased at coin or pawn shops, silver is an easily attainable asset for the common man or woman. According to the North Dakota news article I previously referenced:

"If nothing else, silver is a hedge for protection of your assets," said customer Wayne Papke. An avid collector, Papke buys silver as gifts for others and for his own portfolio. He`s one of a growing number of people investing in this precious metal.

A major reason is prices, which have jumped in the last ten years. In January 2003, an ounce of silver cost less than five dollars. By 2008, it was 15 dollars. This year, it reached 32 dollars per ounce, up more than 600% from a decade earlier.

With prices still rising, more North Dakotans are investing in silver eagle coins -- as many as 500, the maximum amount the Mint will ship at once.

While I’m not expecting such returns in the near term, I think that silver prices still have room to grow significantly both over the short and long term.

Burkett, Brenton. “Silver Coins in Demand”. February 9, 2013. February 14, 2013.

Monday, February 18, 2013

The 5 Strangest Things We’ve Sold, Where, and for How Much

Over the years, we’ve sold a variety of items through various mediums. Whether by way of garage sales, online resale, consignment shops, or similar resale option, we’re open to a variety of methods when it comes to turning our unwanted items into cash. And in doing so, we’ve sometimes found that the results pay off nicely for things that we might not typically consider selling.

Here are a few of the odd items we’ve sold, how we managed to do so, and how much we received in the process (as best as I can remember considering I’ve misplaced a few of the receipts over the years).

I used to have several set of old binoculars that I’d picked up years ago. These weren’t just any binoculars though, but WWII-era sets. One even came with a receipt printed on the back of an old German Luftwaffe field map. I really liked having them, but at the time I decided to sell them, we had just bought our first home, I was in the midst of starting my self-employed career, and money was tight.

Sold for: around $150
Where: Online (iSold it eBay store)
After commission and fees: about $85

Carpentry Planes
It just so happened that when I was at a garage sale one Saturday morning, I stumbled across some vintage carpentry planes. I had absolutely no use for such items and am by no means a carpenter; however, I have an eye for vintage items. They were priced at $10 a piece, but I made an offer of $10 for the pair that was accepted.

Sold for: $45 ($20 for one and $25 for the other)
Where: Online (iSold it eBay store)
After commission and fees: about $25

Action Figures
I held on for my Star Wars action figures and ships for as long as I could, but after hauling them around with me for 25 years and multiple relocations, there just came a point where it was time to say goodbye. Therefore, I packed up my X-wing fighter, Millennium Falcon, and a bunch of my action figures and sent them packing.

Sold for: $120
Where: Online (iSold it eBay store)
After commission and fees: about $70

A Chandelier
When we bought our most recent home, there was a chandelier that we just couldn’t stomach in our dining room. It was a nice chandelier, it just didn’t fit at all with our design motive. Therefore, we took it down and hauled it over to our local consignment shop.
Sold for: $156
Where: Local consignment shop
After commission: $78

Odds and Ends
There are all sorts of other weird items we’ve sold over the years. One such items was an extra refrigerator our energy company paid us $25 to pick up and haul away…fine with us.

Here are a few other interesting items we managed to pawn off on other people by way of the iSold it eBay store, people who found our unwanted items to be their treasures:

• Paper weights (we found these in the first home we bought and they were signed by the artist) – about $60 after commission and fees
• Pasta maker – sold for $30, made about $15 after commission and fees
• Snare drum – sold for $90, made about $55 after commission and fees
• Trumpet – sold for $70, made about $40 after commission and fees
• Food Processor – sold for $82, made about $50 after commission and fees

It’s interesting to look at these items now and realize that I just never know what I might find next that I could turn into cash.

Saturday, February 16, 2013

Chicagoland and Ryan Briscoe

First off, tell me HOW Ryan Briscoe doesn't have a ride for this year?  Second, how can Chicagoland NOT be on the schedule anymore, especially with the newer, safer DW12 Indycar?  Good lord! (By the way, I was actually at the Briscoe win.  Great race!  And check out the five wide coming out of turn number three on the last lap!)

Thursday, February 7, 2013

Benefits of Retirement Tracking

Still in my 30s, retirement can seem like such a long way off. And in our current economy and with the way things are headed with Social Security, Medicare, and the apparent general lack of government willingness to take steps to fix these issues, finding a way to look at retirement planning positively is becoming increasingly difficult for me to do. This however, doesn’t mean that I’m not taking steps to learn more about my retirement and look for ways to plan for and fix my own retirement situation, even if my federal government isn’t willing to help out.

The following are some of the things I’ve done -- and in turn, learned -- about my retirement and retirement tracking.

What I’ve Tracked
I’m a highly analytical person, so I love to track various components of our financial lives. From utility and home costs, to baby expenses and income, there is just about no aspect of our finances that I don’t track, gauge or watch to some extent.

When it comes to retirement progress, I tend to take several major areas into consideration. First off, I gauge overall expenses on a monthly and annual basis so that I can gauge costs, cost changes, and personal inflation rates. This can be a good indication of the direction our costs are heading over time, and by watching our personal inflation rate, I can get a better feel for where our expenses will be as we age.

Second, I gauge our overall asset totals. By watching things like savings, retirement accounts, savings bonds, our home value, and other assets, I can see overall changes in these various assets and determine the progress we’re making over time and at what rate. This provides me with an overall investment return that I can use to gauge future investment growth until retirement.

And third, I gauge our income totals so that I can get a better feel not only for how much money we make, but for how much is going to Social Security and what our (estimated) Social Security benefits will (hopefully) one day be.

How I Tracked it
So how do I track all this stuff? Well, it’s really not that difficult and I don’t try to make it harder than it needs to be. Relatively simple spreadsheets that I update regularly work just fine. For spreadsheets like income, I just use one page that I fill in month by month throughout the year, creating a new page for the following year so that I can go back and review my annual progress over time. For my asset tracking, I tend to create a new copy for each month so that I can break down progress both month-over-month and year-over-year.

So after four years, what exactly have I learned from my tracking?

Well, for one thing, as I already mentioned, I can get a feel for how various investments are progressing over time. Beyond this though, I can gauge overall progress in asset totals, determine seasonal adjustments (like summer when my wife isn’t working), and keep all our retirement-related information in one simple to view and utilize location. This way I can compile all our totals (Social Security benefits, retirement accounts, savings, home value, etc.) in one place.

Over the four-year tracking timeframe, not only have I been able to determine investment return values, but overall growth as well. With such numbers to aid my planning, I can get a better feel for where we’ll be in 10, 20 or 30 year’s time, see where we need to make adjustments, and look for ways in which we need to or could diversify into riskier or safer investments based upon our returns and asset allocations.