Picking up Nickels

Tuesday, August 25, 2009

Health care crisis? I'm Exhibit A

I've shared my worries about my ever-increasing health insurance costs since I started this blog and figured that the nationwide hand-wringing over health care reform made it an opportune time for an update.

The renewal notice for my 2009-2010 family HMO insurance plan arrived earlier this month and beat me into submission with a 14% increase in premiums. I've looked into downgrading my plan for the fourth time since 2001 in an attempt to cut costs, but the tax treatment that comes along with the higher deductible plans doesn't really buy me much when I weigh the risks and costs of going that route.

The numbers don't lie. Since 2001, my health insurance premiums have increased by 116% while the rate of inflation during that time is a much lower 22% (so says usinflationcalculator.com):

For many reasons, this latest increase has been the hardest to take of them all. Most importantly, my monthly health insurance premium has now eclipsed my monthly mortgage PITI (principal, interest, taxes, and insurance) obligation. Even more disturbing, The Commonwealth Fund foundation estimates that family premiums could double by 2020 if cost growth continues on its current course. Good grief!

Isn't it about time that something is done about this? President Obama at least seems to be trying, although I'm not convinced that his initiatives will do much to halt the escalation of health care costs. What we really need is bipartisan support for health care reform and meaningful debate to get this done properly.

So, instead of disrupting town hall forums and calling the President a Nazi or spreading foolish death panel talk, how about asking some tough questions and engaging in some productive debate? How about outlining a plan that will work instead of merely stating how flawed the Democrats' plan is? What we need is someone who will put politics aside and come up will some real reform that will sensibly cut health care costs for all Americans. I believe that the person who has the stones to do just that will be shocked by the number of Americans who will stand behind them in a show of support. Sadly, I'm not sure such a person exists. :(

Tuesday, August 11, 2009

August 2009 Financial Asset Roundup

Here are my current financial assets as of the market close on August 10th, 2009:

Asset July 2009 August 2009 Change
Checking 595 457 -138
Money Market 27,252 34,603 7,351
Savings Bonds 20,445 20,528 83
Treasury Bills 0 0 0
CDs 119,721 120,198 477
Brokerage 80,403 81,501 1,098
401k 66,452 75,752 9,300
Roth IRA 27,556 30,961 3,405
SEP IRA 159,224 177,180 17,956
529 Savings 33,730 37,022 3,292
Total Assets $535,378 $578,202 $42,824

It's been a fun ride over the past month as the S&P 500 index has surged 14.56% since the last update:

(chart courtesy of msn.com)

Hints of the recession coming to an end are starting to appear. Unemployment actually went down to 9.4% and a few talking heads have already called an end to the recession (much to the dismay of the Federal Reserve, I'm guessing). Still, I think we need a much larger improvement on the jobs front before declaring victory.

Along with the rise in the stock market, crude oil has jumped to above $70 per barrel again. I've definitely been seeing that reflected in increases at local gas pumps over the past couple of weeks. On another note, the partisan whining about health care reform is ironic (not to mention disappointing) considering the Democrats are proposing a plan not unlike the one implemented in Massachusetts by former Republican governor Mitt Romney. For Pete's sake, I wish both parties would stop whining and do something about the annual double digit price increases in health insurance premiums that I have been seeing for this entire decade.

As for money moves, I took advantage of the stock market bounce to sell my position in home improvement retailer Lowe's Companies Inc, (LOW) that I've held for the past nine years. I figured it was time to lock in my profit considering the stock price was up near YTD highs and I don't see the housing market ready to boom any time soon. I'm still unsure what to do about my first Penfed 6% APY CD maturing next month, although I'm actually considering dumping the cash in a one year 2% APY Penfed CD. Yuck...

Monday, August 10, 2009

Three years of blogging and counting!

Boy, a lot of things have changed since I started this blog in August 2006.

Back in 2006 we were more than a year away from entering the recession we're currently working our way through (or are we?), the S&P 500 index was about 20% higher than it is now, a gallon of gas cost me about three bucks, and 6% APY CDs and 5% APY savings accounts were readily available.

Ironically, despite the stock market taking a beating over the past year or so, my bottom line is up about 22% over the past three years. That gain can pretty much be attributed to distributions and SEP IRA contributions from my S Corporation, which I suppose reinforces the idea that ongoing contributions (and not just stock market gains) are an important part of building a sizable nest egg:

(chart courtesy of msn.com)

My hope is that an anniversary post one year from now will bring better news with regards to jobs, the economy, and the stock market. But no matter how things turn out I would like to once again thank all of the visitors who stop by for your comments and links. Well, except for the spammers at least. :)