Last week, I finally got around to my free meeting with the financial adviser. Yes, it was two months later, but, hey, I only canceled on him once. :) I'm a pretty busy gal.
In our meeting, we began by discussing goals and plans for now and for retirement. I told him our current #1 priority of paying off the nasty, evil credit card debt, and that we then planned on building an emergency fund and saving for retirement. I even outlined our eventual plan - contribute to the 401(k)'s until we reach the maximum employee match, then open Roth IRA's for each of us and contribute the maximum we can. After that, go back to the 401(k)'s. Simple, right?
It's actually very simple, straightforward... and not really necessary for professional input. I'm sure I'll want to do some research on how to allocate my funds (once I have some) and when we eventually have the money to invest directly, I'm going to want some help. But right now, there's not much for him to do. I did leave the meeting feeling better about the decisions I am making,but that's about it. Reassurance.
I'm just glad the meeting was free and I didn't have to pay for it. :) And I can't wait until we reach the point where we can use professional help. Just one more reason to get the debt monkey off our backs.
Monday, December 10, 2007
Thursday, December 6, 2007
Carnivals Galore!
Back in the swing of things! This week I participated in FOUR carnivals. Very exciting stuff! In order of appearance:
The Carnival of Debt Reduction #116 at Blogging Away Debt. My post on my Minimum Payments Gone Haywire was included. Others I enjoyed were:
The Carnival of Debt Reduction #116 at Blogging Away Debt. My post on my Minimum Payments Gone Haywire was included. Others I enjoyed were:
- Journey to Financial Freedom has 8 Debt Signals to let you know how serious your debt is. I wish I have never had any of those signals, but a few look familiar!
- Moolanomy posted 7 Steps Debt Reduction Illustrated. I the pictures, they tell the story very well.
- Verve Coaching posted Five Tips to Improve Your Credit Score. I'm going to follow these!
- My Money Thinks posted some Outside the Box Holiday Gifts -way better than getting generic presents.
- Free Money Finance posted the 10 Most Hated Money Saving Tips - and I only hate one of them! For the nosy people, it's the one about pets. The rest I either do now or plan to sometime in the future.
- My Money and My Life has a few ideas for Fun & Inexpensive Christmas Gifts.
- Watch me Become a Millionaire posted about saving money by making Coffee at Home. I love doing this, especially with a little special creamer.
- A Penny Closer has a fantastically written story on his First Debt. He has a new subscriber in me!
Should I Keep the Great Deals to Myself?
As I progress through this gift giving season, I have been faced with a dilemma. I have been getting great deals on the presents I'm giving left and right, which I am very excited about. So what's the problem? I don't know whether or not to share that the gifts I bought were on sale.
This doesn't really sound like a very big problem, I know. Except I don't want it to seem like I spent too much money on their Christmas gifts. If someone gives me a gift or gifts that are much bigger or more expensive than what I give them, then I feel pretty bad. I wouldn't want to make anybody feel bad on Christmas. On the other hand, I am averaging about 50% off the retail price, which essentially doubles my Christmas budget. I want to, and planned to, use my Christmas budget to the max. Nor do I want to brag about how well my shopping went (to them, anyway, blog readers are fair game:)).
Some people are easy - my husband, for example knows exactly what I spent on his gifts, and my mom always loves a good bargain. With my pared-down Christmas list, most of the people on it are people I can share the deals with. It's not like I'm shy about being frugal - it's a well-known fact. And some of my gifts are pretty obviously low-cost. I hope that those don't make me look cheap. What problems to have - half too expensive and half too cheap. :)
I think my best bet is to be honest as much as I can, but keep a little bit of mystery. If someone asks me how much something cost and I don't want to share, I'll just say "Exactly as much as I wanted to spend." Case closed!
This doesn't really sound like a very big problem, I know. Except I don't want it to seem like I spent too much money on their Christmas gifts. If someone gives me a gift or gifts that are much bigger or more expensive than what I give them, then I feel pretty bad. I wouldn't want to make anybody feel bad on Christmas. On the other hand, I am averaging about 50% off the retail price, which essentially doubles my Christmas budget. I want to, and planned to, use my Christmas budget to the max. Nor do I want to brag about how well my shopping went (to them, anyway, blog readers are fair game:)).
Some people are easy - my husband, for example knows exactly what I spent on his gifts, and my mom always loves a good bargain. With my pared-down Christmas list, most of the people on it are people I can share the deals with. It's not like I'm shy about being frugal - it's a well-known fact. And some of my gifts are pretty obviously low-cost. I hope that those don't make me look cheap. What problems to have - half too expensive and half too cheap. :)
I think my best bet is to be honest as much as I can, but keep a little bit of mystery. If someone asks me how much something cost and I don't want to share, I'll just say "Exactly as much as I wanted to spend." Case closed!
Tuesday, December 4, 2007
Practically a Different Person
Last week, when reading a post over at PaidTwice about her changes in attitude, I started thinking of how I've changed since we started this debt payoff journey. I couldn't really come up with anything except "I spend less money now". It sounds so simple, right?
Then I had a conversation with my sister, discussing our respective Christmas lists. I told her a few things I was looking for: knee highs, undershirts, hair mousse, cookbooks, and she proclaimed, "But none of those are fun!" It hit me like a ton of bricks - almost everything on my list was practical. Even the cookbooks weren't solely for pleasure; they were useful, too. I wasn't really asking for things that I wanted, but things that I needed. Things that the old me would have run out to the store to buy.
Somewhere in the past year and a half, I went from buying the things I wanted to buying the things that I needed to wanting the things that I needed. Unless it is something I can't live without, I put off buying it until I can ask for it as a gift. I have been out of hair mousse for at least 3 months, but I refuse to buy it because I don't strictly need it. Same goes for some makeup - I have been using an old, forgotten eyeliner until I can ask for a new one in my Christmas stocking.
Of course, if it's an essential, it's already built into the budget, but for all the little "extra" items, nope. Many a time I've stood in an aisle of Target, picked up some new non-necessity only to put it right back again. The one time in recent memory I've actually purchased a non-necessary item for my self, it was a pack of bobby pins. That were on sale. For $0.79. That, when I got home, I gave to my husband to give to me for Christmas. In October.
There are plenty of examples of my attitude transformation:
BAD: Buying a magazine every time I saw a new issue on the newsstands
BETTER: Subscribing to my favorite magazines
BEST: Ordering magazines through My Coke Rewards (Bonus: using other people's Coke caps) and reading from the selection at the gym
BAD: Grocery shopping every day, with reckless abandon
BETTER: Grocery shopping once a week with a list
BEST: Grocery shopping once a week with a list, coupons, freezer inventory and menu plan
BAD: Buying myself gifts because "I deserved it"
BETTER: Buying myself treats with my fun money
BEST: Treating myself to free "gifts" like a night in watching movies or an hour blog-a-thon :)
BAD: Buying books I wanted to read
BETTER: Only buying a few books, on sale
BEST: Getting books at the library, or with gift certificates
BAD: Replacing an item if it broke, on credit
BETTER: Replacing broken items with cash
BEST: Evaluating how necessary the item was, and only replace immediately if I can't go on without it
Obviously, this has pushed me to become more frugal, and work towards the ultimate goal of eliminating our debt. Some of these are borderline cheap, but they only affect my husband and me, and are taken on a case-by-case basis. It's pretty amazing to see the differences in our spending now that we only buy absolute necessities.
Then I had a conversation with my sister, discussing our respective Christmas lists. I told her a few things I was looking for: knee highs, undershirts, hair mousse, cookbooks, and she proclaimed, "But none of those are fun!" It hit me like a ton of bricks - almost everything on my list was practical. Even the cookbooks weren't solely for pleasure; they were useful, too. I wasn't really asking for things that I wanted, but things that I needed. Things that the old me would have run out to the store to buy.
Somewhere in the past year and a half, I went from buying the things I wanted to buying the things that I needed to wanting the things that I needed. Unless it is something I can't live without, I put off buying it until I can ask for it as a gift. I have been out of hair mousse for at least 3 months, but I refuse to buy it because I don't strictly need it. Same goes for some makeup - I have been using an old, forgotten eyeliner until I can ask for a new one in my Christmas stocking.
Of course, if it's an essential, it's already built into the budget, but for all the little "extra" items, nope. Many a time I've stood in an aisle of Target, picked up some new non-necessity only to put it right back again. The one time in recent memory I've actually purchased a non-necessary item for my self, it was a pack of bobby pins. That were on sale. For $0.79. That, when I got home, I gave to my husband to give to me for Christmas. In October.
There are plenty of examples of my attitude transformation:
BAD: Buying a magazine every time I saw a new issue on the newsstands
BETTER: Subscribing to my favorite magazines
BEST: Ordering magazines through My Coke Rewards (Bonus: using other people's Coke caps) and reading from the selection at the gym
BAD: Grocery shopping every day, with reckless abandon
BETTER: Grocery shopping once a week with a list
BEST: Grocery shopping once a week with a list, coupons, freezer inventory and menu plan
BAD: Buying myself gifts because "I deserved it"
BETTER: Buying myself treats with my fun money
BEST: Treating myself to free "gifts" like a night in watching movies or an hour blog-a-thon :)
BAD: Buying books I wanted to read
BETTER: Only buying a few books, on sale
BEST: Getting books at the library, or with gift certificates
BAD: Replacing an item if it broke, on credit
BETTER: Replacing broken items with cash
BEST: Evaluating how necessary the item was, and only replace immediately if I can't go on without it
Obviously, this has pushed me to become more frugal, and work towards the ultimate goal of eliminating our debt. Some of these are borderline cheap, but they only affect my husband and me, and are taken on a case-by-case basis. It's pretty amazing to see the differences in our spending now that we only buy absolute necessities.
Monday, December 3, 2007
Standing on the Brink
My darling husband started his own blog today, Standing on the Brink. On his blog, he writes about growing his company and the trials, successes and failures along the way. In my completely unbiased opinion, he is a fantastic writer. Plus, reading all about his company will help explain how we took on this debt in the first place - much of it was used to get Servprise off the ground. So take a minute and check it out!
Sunday, December 2, 2007
November Round Up
All in all, November was a great month. We received extra paychecks, visited family, started our Christmas shopping, and paid off another credit card! Wow.
The best news of all is... we hit our debt payoff monthly goal for the first time since June!! In November, we paid $3103.14 toward our credit card debt, which surpasses our goal of $3000 per month and blows our budget of $2771 out of the water. The total paid to principle was $2971.48, bringing our current total debt down to $13620.08. To date, we have paid off 65% of our credit card debt, up 8 percentage points from October!
Despite my problems with my commissions, my income was still $330 above the budgeted amount, thanks to those extra paychecks. We went over our gas budget by $27.06, in part from the extra travel and also the increasing gas prices. I thought that was going to be much worse, so I am OK with that. The grocery budget was under by $10.98, but our fun money was over again by about $40. What is really hurting us there is we have gone to a few concerts recently, and it costs us more than the price of the ticket. Something to work on :).
The Christmas budget is coming along nicely. I have been filling out my Christmas Plan spreadsheet after everything I buy, and I'm about halfway done with all the shopping. It really helps to not be exchanging gifts with the in-laws this year (more on that soon). I am pretty amazed with how far my dollars are stretching, and I can't wait to write some posts about it. I knew I shouldn't have shared this blog with my family!
That being said, December is making me a little nervous. We'll be traveling again for New Year's, and with all the gifts and craziness, I'm going to have to fight to keep the budget under control. I know that if my commissions don't get sorted out, the chances of us hitting our debt payoff goal for December are pretty slim. The credit card we're working on currently has a balance of $2486.55 - I would LOVE to knock that off before the new year. I think it's going to be pushed into 2008, though.
The best news of all is... we hit our debt payoff monthly goal for the first time since June!! In November, we paid $3103.14 toward our credit card debt, which surpasses our goal of $3000 per month and blows our budget of $2771 out of the water. The total paid to principle was $2971.48, bringing our current total debt down to $13620.08. To date, we have paid off 65% of our credit card debt, up 8 percentage points from October!
Despite my problems with my commissions, my income was still $330 above the budgeted amount, thanks to those extra paychecks. We went over our gas budget by $27.06, in part from the extra travel and also the increasing gas prices. I thought that was going to be much worse, so I am OK with that. The grocery budget was under by $10.98, but our fun money was over again by about $40. What is really hurting us there is we have gone to a few concerts recently, and it costs us more than the price of the ticket. Something to work on :).
The Christmas budget is coming along nicely. I have been filling out my Christmas Plan spreadsheet after everything I buy, and I'm about halfway done with all the shopping. It really helps to not be exchanging gifts with the in-laws this year (more on that soon). I am pretty amazed with how far my dollars are stretching, and I can't wait to write some posts about it. I knew I shouldn't have shared this blog with my family!
That being said, December is making me a little nervous. We'll be traveling again for New Year's, and with all the gifts and craziness, I'm going to have to fight to keep the budget under control. I know that if my commissions don't get sorted out, the chances of us hitting our debt payoff goal for December are pretty slim. The credit card we're working on currently has a balance of $2486.55 - I would LOVE to knock that off before the new year. I think it's going to be pushed into 2008, though.
Saturday, December 1, 2007
Minimum Payment Gone Haywire
Back in August, I messed up and paid one of my credit cards late. After a few phone calls and back and forth, the late fee was removed (twice, then one put back) and I was promised that my interest rate wouldn't change. Which it didn't- the interest stands at 12.49%, making it my lowest rate of all our credit cards. In fact, while writing this post, I realized that the interest rate has dropped from 12.99% to 12.49%, without me having to ask.
What has changed on this account is our minimum payments. I pay attention to the minimum payments because, as our smallest interest rate in the snowball, that's all I pay. Right after the late fee drama, the minimum payment was off by one late fee ($39), and totaled $171. Then the following month (October), the payment was still high, at $164. This was completely unexplained.
Logically, as more payments are made, the principle will decrease, and the interest earned will also decrease over time. As most credit cards charge interest on the average daily balance, days with longer months will have slightly higher interest charges than shorter months, thus creating a variable interest amount built into the minimum payment. So I checked out the interest charged in August (for September's payment) and September (for October's payment). They were $70.49 and $64.78, respectively. I think this is why the interest rate dropped from $171 to $164. Now we're getting somewhere.
Except... in August, the minimum payment was $133. So October's minimum payment should have been somewhere close to that. And then November's minimum payment was $128, and the new bill for December has a minimum payment of $122. Why does this have to be so confusing?!?
I think that, quite simply, BofA made a mistake in calculating October's minimum payment. Maybe it was a result of Sepetmber's mix-up, or maybe it was just a glitch. In the long run, it doesn't make that much of a difference, and the money was applied to the principle, so it's still going to the debt payoff. What really disturbs me is that the minimum payment can change so drastically. While my budget allows for such fluctuations, it could be detrimental to someone who is under tighter financial restrictions. What is really disturbing is that I couldn't find how my minimum payment is calculated on the statement, nor was I able to find it on their website. I hope it's there somewhere and I'm just missing it - otherwise it leaves me with a very uneasy feeling.
What has changed on this account is our minimum payments. I pay attention to the minimum payments because, as our smallest interest rate in the snowball, that's all I pay. Right after the late fee drama, the minimum payment was off by one late fee ($39), and totaled $171. Then the following month (October), the payment was still high, at $164. This was completely unexplained.
Logically, as more payments are made, the principle will decrease, and the interest earned will also decrease over time. As most credit cards charge interest on the average daily balance, days with longer months will have slightly higher interest charges than shorter months, thus creating a variable interest amount built into the minimum payment. So I checked out the interest charged in August (for September's payment) and September (for October's payment). They were $70.49 and $64.78, respectively. I think this is why the interest rate dropped from $171 to $164. Now we're getting somewhere.
Except... in August, the minimum payment was $133. So October's minimum payment should have been somewhere close to that. And then November's minimum payment was $128, and the new bill for December has a minimum payment of $122. Why does this have to be so confusing?!?
I think that, quite simply, BofA made a mistake in calculating October's minimum payment. Maybe it was a result of Sepetmber's mix-up, or maybe it was just a glitch. In the long run, it doesn't make that much of a difference, and the money was applied to the principle, so it's still going to the debt payoff. What really disturbs me is that the minimum payment can change so drastically. While my budget allows for such fluctuations, it could be detrimental to someone who is under tighter financial restrictions. What is really disturbing is that I couldn't find how my minimum payment is calculated on the statement, nor was I able to find it on their website. I hope it's there somewhere and I'm just missing it - otherwise it leaves me with a very uneasy feeling.
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