Beethoven In Trance - Special Episode 2007 Annual Letter

2007 is a year of on track.

At the beginning of 2007, we thought 2007 would be a year of improvement as it seemed to be a natural continuum to the new things that we had got in 2006 (a new car, a new house, a new job and a new married life). Now looking back what we have accomplished in the passing year, we find the main theme is more accurately described as 'on track'.

Our personal finance management project is the star of the year. I looked over my notes (notes system is the result of a training program called 'Get things done') and was able to trace it back to March when there was no project, only thoughts and researches . Gradually, thoughts are combined with research results and translated into tasks. During the process, the personal finance project was born.

The project consists three parts, retirement planning, budgeting and expense management. Retirement planning focuses on investment and I am taking the lead. Jessica has been doing accounting since 2006, therefore, she is naturally the expense manager. We work together on budgeting as it includes cash reserve for both investment and various expenses. We like this arrangement as we can focus on our individual responsibility while still work as a team.

In retirement planning, we have revised our 401K portfolio, and opened a new RothIRA account and another after-tax investment account. There are few benefits to have these accounts. They bring diversified selections to our retirement money (our 401K account has a small pool of choices). The money saved in RothIRA can be withdrawn tax free after retirement. It is also tax efficient to have RothIRA to hedge the 401K account after retirement (instead of being hit by a lump sum from 401K). We are still fine tuning the magic number to allocate fund among the three accounts.

We selected ETF and index fund in our investment accounts. I didn't include individual stock because it's too big a chunk for me to chew. ETF and index funds are cheaper and stable, therefore, ideal for retirement investment. We selected the brokerages based on commission, fees, service and convenience. So far we haven't had any issues. The performance of our selected funds is not stellar due to the overall sluggish market condition. We are in the valley now. We expect to get back next year after we rebalance our portfolio. In 2007 our goal of investment was "to get into the game", while in 2008 we hope to "play the game".

Another vehicle of preserve wealth is banking, which we haven't worked on very hard in 2007. Bank interest rate has been falling during the last couple months when federal reserve cut the rates. There are better rates out there comparing to what we have now, and we are in the process to move our money. The rate cut brings down the mortgage rate too, which is to our benefit if we refinance. This of course, is on our 2008 task list.

We also opened two credit cards in 2007. One is for store Tjmaxx which we spend most of our shopping money. The other one is American Express, which is for our shopping in Costco. Both cards give rewards. We dig out our previously opened Amazon credit card for the same reason as well.

In 2007, I acquired some cookware, 17 pieces totaling $347. There are some good buys and some wastes. The 4qt. stainless steel pressure cooker from LNT @ $15 is the pan of year. (price is after mail in rebate which I just received). The worst buy is the Spain-made Paella Pan @ 7 because I rarely use it. I also bought a few French-made cooper pan lined with tin, but due to the high maintenance, I returned to the shop. Another piece worth mentioning is the thin cast iron wok I got from "The Wok Shop" through amazon.com. The wok didn't come as I expected and the shipping cost prohibited me from returning it. I had to use it and now I start to have a better opinion of it.

Other than cookware, I acquired some knifes and chopping board. I also bought a knife sharpener to bring some of my old knifes back to life. It was a long journey to find the perfect chopping board and I finally settled with a deep-discounted butcher block from Tjmaxx @ $36 (original price is $100). During the search, I have bought and returned 3 cutting boards from Costco and two from Lowes. I was also managed to glue a splitted bamboo chopping block that I previously bought for $5.

We didn't spend much on clothing in 2007 due to the limited need. I did buy a pair of running shoes from amazon (as it's the fitting model on sale), and a pair of trail shoes for daily walking (to replace my Asics Gel Eagle Trail), and a pair of adidas G-Tex mountain shoe for the snow in winter Cleveland (to replace my old adidas mountain shoe that I brought from China 6 years ago).

On the other end of expense, I am happily to report an earning of $900 for the trainings I did during the year. I have gathered some useful information about the current situation in China and expect to get to read more in the coming year.

Overall, our best money move in 2007 might be opening the RothIRA and the worst money move might arguably be paying a big lump sum of our mortgage at the beginning of the year on our principle (rather than investment). We expect to have a better picture on the expense side next year.

Setting money aside, our first year married life is doing all right. Nothing major, as we have lived together for 5 years. My in-laws (visited from Canada) stayed with us for almost a year, during when they were managed to move their son from Canada to US, who eventually got a job here and had a baby girl in 2007. It has been suggested in multiple occasions by multiple people that we should have a baby. We are glad to report that this will be one of our 2008 objectives.

During my in-laws stay, we visited Niagara Falls, New Mexico for the International Ballon Festival and Colorado. The trips are well organized, and I was happy with the food that I made in the hotel in a small sauce pan over an electric burner.

Speaking of cooking, I read a Chinese cook book that my mum brought to me in 2006. I enjoyed the book and learned a few tricks that clarified my misunderstanding of certain cooking techniques. I have tested a few recipes and applied some techniques in my cooking and the result is very promising.

2007 is also the first year we went fishing here in Cleveland. We didn't have much luck in most of the lakes around the town till our neighbor brought us to a creek close by. We closed 2007 with a triumph catch of a heavy weight carp. I butchered it afterwards (which was made into a home video), cooked it, and shared with our neighbor that night.

We hosted a party in late summer joined with our friends from India. We got to know them from the school. We had a wonderful time and wonderful food that night. Months later, one of the guests returned the favor by inviting us to her party to celebrate ‘Dawali’ (Festival of Light, a major Indian festival holiday). Again, we were accompanied by some great friends and enjoyed this foreign festival very much.

Our neighbor helped us installing a ventilation fan in our kitchen in the summer. This helps mitigating our constant smoke alarm situations though doesn’t completely eliminated the instance. I finally decided to remove the smoke alarm and sit them inside the bedroom next to the windows. We had Lowes installed our two entry doors (after an unpleasant encounter with Homedepot) and painted them in bright colors. Though the color is great, the paint brush stroke is still visible when looking closely. We are still very amateur in painting. I put in some drain caps on the gutter and bathtub. They seem to be effective preventing basement leak this year. I also moved the dehumidifier up to the bathroom from the basement this winter. It dries up the bathroom fairy well (in absence of a ventilation fan) after the shower. We still have a leaking roof, which we plan to fix in the coming year (I remember I said that in 2006).

We have been recovering from the injuries we got from the 2006 half marathon. Unfortunately, I just injury the hamstring and calf again lately due to a longer-than-usual run. Hope we fully recover soon and will be able to run a full marathon in 2008.

We continue to watch movies around the world last year. We got our movies from the local library for free. We watched most of works from Hayao Miyazaki in the last two months. His work is not a stranger to me, as I’ve heard of him before I came to US. I didn’t appreciate much his work at that time because I was very much into ‘Ghost in the Shell’ type of animation. Now I consider him a very important animator and director in the world cinema as he always portraits the purist virtues through his amazing characters and unbounded imagination.

The last month of the year we got into a ‘Bollywood Mood’ after we watched the movie ‘Veer Zaara’ (I heard this name from a Indian movie award show DVD). I liked it very much and started to look for Indian movies. I found the movie ‘Kabhi Khushi Kabhie Gham’ through the song ‘You are my Sonia’ from Youtube (I watched the MTV years ago and still remembered). Kabhi Khushi Kabhie Gham means Sometimes Happiness, Sometimes Sadness. This is a pretty accurate description of life in general I will say. And one thing leads to another, I now have over 20 movies on my list in the library thanks to Wikipedia. Both of us have been singing the tune ‘Bole Chudiyan’ (a song from the movie Kabhi Khushi Kabhie Gham) for almost a week now. We watch the movie two nights ago and we just can’t get enough of it.

With a happy Hindi song and a finance structure that is coming into shape, I am glad to conclude the year 2007 as a year of ‘on track’, and report the answer “Yes” to my father's question 'is it a better year than the previous year?'.