Tuesday, April 27, 2010

Remodeling & Roleplaying

I'm not talking about our house, though we are doing a lot of work on it. I'm talking about my website, www.cullun.com.

This site is more of a portal, than a full fledged website on its own, to the different sites of mine and the different roles I play. This blog is the amalgamation of those persona and that site is the portal to them.
If you think about it, we all play a lot of roles in our lives, but what defines us? Just because you work in Real Estate does that mean you are a Realtor? Just because you work as a Nurse that mean you are a Nurse? Well yes, and no.

A great quote I've used on my site is:
Remind Yourself: I am a human being before anything else. -Frank Chimero
We can all get caught up in titles. When you meet a stranger it's easy to just ask "so, what do you do?". That tells us some about the person, but what we do at a job isn't who we are, only a reflection. It's very similar, if not the same, as stereotyping. These roles we play and categorize people into help reduce the amount of thought we have to put into understanding the person.

If you have children, you're a parent. If you live on the streets, you're homeless. It's similar with religious labels: Christian, Atheist, Buddhist, Muslim, Hindu, etc. Those roles that we play as humans are part of who we are, but first and foremost we are all human. If we all took that a little more to heart and looked at our fellow humans that way I think the world would be a better place. Yeah, I know, sappy.

So, what are you?

Friday, April 23, 2010


A few terms which have picked up steam in the alphabet soup that is real estate lately are HAMP and HAFA.

HAMP -Home Affordable Modification Program

HAMP is an existing program attempting to modify loans to keep people in their current homes. Sometimes even this isn't enough to be able to help a family stay in their home though. As such, HAFA was introduced.

Fannie Mae has made some extensive information available about HAMP.

HAFA - Home Affordable Foreclosure Alternatives

HAFA officially began on April 5, 2010 and ends December 31, 2012. This is a program designed by the Treasury Department to try to reduce foreclosure by providing incentives to help move short sales along or to complete a deed-in-lieu of foreclosure. Any lender participating in HAMP is required to participate in HAFA.

Some examples of the incentives are:
  • $3,000 for borrowers to help with relocation costs
  • $1,500 to loan companies to help process the transaction
The National Association of Realtors (NAR) has published an FAQ about HAFA.

It's not pleasant to find yourself in a situation where you need to ask for help, but these and other programs are out there. Make sure to contact your local Realtor to see if they can help you.

Wednesday, April 21, 2010

Roll 401k into Roth IRA

When changing employers, as I did last year, it's important to look at not just the short-term impacts but also the long-term. One of the most important of these is the retirement fund that you've been contributing all of your hard-earned money into. Typically this is a 401k, and it was in my case, so that's what I'll be writing about.

When breaking up with your employer you have various options on what to do with your retirement fund and these can vary by employer. In my case the funds have been sitting there held by the same company and growing without contributions. But it's decision time on if I just want to leave them there or not.

This forced me to look at the differences between a Roth and non-Roth accounts. There's a ton of information about these online so I'll just sum up my interpretation of it:

Roth accounts are post-tax instead of pre-tax. This means you pay taxes on the money now, and then move it to your retirement fund and do not have to pay taxes on it or your gains when you pull it out. While the tax defer is a benefit, especially if it saves you a tax bracket, that's all it is - a deferral. When you withdraw from your non-Roth 401k or IRA you'll have to pay taxes on a sum that's much larger than it was and in the future, what are the odds the tax rates will be higher then? I'd say pretty good. As such, going the Roth route seems like a no-brainer to me.

There's an added benefit in 2010 with your conversion to a Roth. You can defer the taxes so that you don't get dinged as hard during your conversion. This potentially helps prevent you from having to withdraw (and get penalized) from your funds to pay the taxes on them. For 2010 you'll be able to defer paying any taxes and then 50% of your funds are taxed on 2011 and the other 50% on 2012.

Talk to a professional to ensure you get this done right. I haven't done this yet, so look forward to more blogs about this as well as my journey into what is known as a self-directed Roth IRA. This gives you much more investing options and puts you in the driver seat. Not for everyone, but I'm excited about it and sharing that experience.

I'm curious what others have done when they've changed employers. Please share below and maybe we can pick some tricks up from each other!