In the midst of all of our debt repayment, I began to wonder: what would we do now if our income was cut off? In an ideal world, we would have a nice 6 month emergency fund to rely on until the income streams began to flow again. Unfortunately, this is far from Utopia and we don't have a 6 month emergency fund. We don't even have a 1 month emergency fund yet.
If our income decreases, our budget would have to be altered as well. We run a pretty tight & frugal ship, but there are a few more corners that could be cut. We made the decision to be slightly less than gazelle intense in order to keep at the debt repayment for the long haul. For example, we have a gym membership, Netflix, and $100 "fun money" each month, per person. We are frugal, but still manage to enjoy ourselves occasionally. In the event of an income disaster, our priorities would have to shift, again, to a completely bare bones budget. No frills, no extras. Just the necessities.
The first priority would be survival. To survive, we need food and shelter. Our mortgage and grocery bill are the first items in the bare bones budget. (Reminder: we are assuming the income setback is temporary. If it were permanent, we would have to move to a less expensive housing option.) The mortgage is constant, but the grocery bill could be trimmed to eliminate any junk food, expensive meats, even dairy products.
The next line items in the budget support our survival and include electricity, water, gas, car payment and car insurance. Our utilities are almost basic needs, but we could theoretically come up with a payment plan if need be. In Massachusetts, it is illegal to shut off the heat during the winter if you are experiencing financial hardship. We have electric heat, so we would be able to keep our electricity even if the bill wasn't paid. Gas, the car payment and the car insurance are needed to continue working or job searching.
Following that is the internet and phone bills. We combine our internet with our cable, and it would actually cost more money to cut back to just the internet. This is needed to continue working (we both work from home 10-20 hours a week) and job search, if need be. Our cell phones are the only phones we have, and we need to be able to contact work and potential jobs.
The last items in the bare bones budget are our debts. The student loans could be deferred if the situation persisted. We have eliminated much of our credit card debt, but the stubborn beast remains. With a drop in income, we would maintain our minimum payments and any extra, if possible, but wouldn't be able to attack the debt anywhere near as aggressively.
Once I put all of these numbers on paper, it was much easier to see how much money we need to make. Most of our expenses are fixed, so this is a pretty accurate picture. For a temporary solution, we would do everything we could to make enough money to equal our expenses, but, if need be, would borrow funds to stay afloat. I wouldn't be willing to give up our house and life for a one or two month drop in our income. Once we start approaching month 3-4, something would have to change.
Showing posts with label Budget. Show all posts
Showing posts with label Budget. Show all posts
Monday, January 28, 2008
Wednesday, January 23, 2008
The Timing Was a Little Off
Sometimes I take the money we have for granted. I assume it will always be there, sitting in my account, until I tell it where to go. My husband gets paid the first of the month. I get paid every other Thursday, and the last day of the month. Two months out of the year, I get 3 paychecks. Fantastic. And then there are the months where my second paycheck comes later in the month. Like January.
Our bills are all due by the 23rd of every month. Most of them fall in the first week (mortgage, car insurance, condo fees) and the rest are spread out... until the 23rd. It's usually nice to have a week or so at the end of every month where all our bills are paid and we're just cruising until the next month. We spend our money on regular expenses like gas and groceries, and put the excess onto the credit cards. Feels good to be "done" for the month.
In January, however, all of our bills were due before my second paycheck, which will be deposited tomorrow. This would have been perfectly fine if I had realized this in the beginning of January. I made a large payment to the credit card in the first week of January that could have waited. However, I didn't notice until I was looking at our projected balance in our bank account in Quicken last week. The lowest projected balance was $248.76, which doesn't include groceries or gas. Yikes! That's cutting it a little too close for me.
We talked it over and decided to play it safe. So, for the past week and a half, we have been using the credit card for our regular expenses. We have charged about $150 in that time for food and fuel. Which is in line with our budget. I just hate that we had to rely on the credit to "float" us until the paycheck comes in. It reminds me too much of the old days when we relied on credit for everything. On Friday, once my paycheck is cleared, the first thing I'm going to do is pay off that balance. It's still in the grace period, so no interest will accrue. And in the future, I'll pay a little more attention to our lowest projected balance and plan accordingly.
Our bills are all due by the 23rd of every month. Most of them fall in the first week (mortgage, car insurance, condo fees) and the rest are spread out... until the 23rd. It's usually nice to have a week or so at the end of every month where all our bills are paid and we're just cruising until the next month. We spend our money on regular expenses like gas and groceries, and put the excess onto the credit cards. Feels good to be "done" for the month.
In January, however, all of our bills were due before my second paycheck, which will be deposited tomorrow. This would have been perfectly fine if I had realized this in the beginning of January. I made a large payment to the credit card in the first week of January that could have waited. However, I didn't notice until I was looking at our projected balance in our bank account in Quicken last week. The lowest projected balance was $248.76, which doesn't include groceries or gas. Yikes! That's cutting it a little too close for me.
We talked it over and decided to play it safe. So, for the past week and a half, we have been using the credit card for our regular expenses. We have charged about $150 in that time for food and fuel. Which is in line with our budget. I just hate that we had to rely on the credit to "float" us until the paycheck comes in. It reminds me too much of the old days when we relied on credit for everything. On Friday, once my paycheck is cleared, the first thing I'm going to do is pay off that balance. It's still in the grace period, so no interest will accrue. And in the future, I'll pay a little more attention to our lowest projected balance and plan accordingly.
Monday, January 21, 2008
My Top 10 Favorite Free Things To Do
The other day, Trent at the Simple Dollar posted about free things to do. It really got me thinking. With all the whining I've done recently, I need to celebrate some of the finer (free) things in life, because, let's face it, it's not so bad. :)
I made a list of all my favorite free things to do and stopped at 56 because that's how many lines were on the piece of paper and I am weird like that. I could probably double that, given the time and another sheet of paper. I could bore you with a nice, long, 112 item list, but I figured I'd whittle it down to the top ten. Since I love countdowns and think they're much much better than countups, I present to you, in ascending order, my ten most favorite free things to do.
10. Taking a walk. Little did I know that, when my parents and I would take walks with our dogs years ago, that it was actually fun and useful. I enjoyed it then and I enjoy it now - a nice little stroll down the road or a walk around the park. Lovely.
9. Sledding. Not tubing, sledding. We live next to a golf course with a nice big hill up to the 6th green. I'm sure it's a bugger to play that hole, but it's fun to slide down the hill!
8. Sunbathing. I know, I know, skin cancer. Bad for you. UV rays. But it feels SO GOOD to lay out in the sunshine and feel the sweet breeze on your skin. Since my husband is fair-skinned, I use sunscreen religiously when planning a day out. I most often sunbathe at the beach (obviously) and love to combine it with...
7. Reading a (borrowed) book. Whether borrowed from the library or my darling sister or mom, I rarely buy books, but read as many as I have time to. I have always been big into reading and I go through them pretty quickly, easily losing myself in the story.
6. Sitting by a fire. In the fireplace or an outdoor campfire, I am drawn to a burning pile of logs like, well, a moth to a flame. Something about the crackling wood and the smoke transcends all seasons and is very relaxing. My husband and I have had many heart to hearts while staring into the fires - it makes for some good conversations and removes the everyday hum of technology that seems to surround us.
5. Sleeping. I remember the days when I begged to stay up later than my bedtime. Now, bedtime is something I look forward to every night. I love my bed and the feeling of complete relaxation when I place my head on the pillow.
4. Playing with my Kitties. My two crazy cats are always coming up with something new. Calypso, the older cat loves to jump for toys - I mean back flips. Tango, the baby, has learned how to play fetch with his toys and keeps bringing them back. They just always bring a smile to my face.
3. Snuggling. I love to curl up on the couch with my husband and kitties and watch a movie or just plain be. It's probably the easiest way to unwind after a long day.
2. Taking Pictures. I have always been a take pictures of things and not people kind of girl. I like to carry the camera around and capture whatever catches my eye. While you could argue that this isn't free because you need a camera, we bought ours years ago and use it often enough that the cost per use is very very low.
1. Playing Board Games. This is my favorite thing to do when we have a group of people together. My preferred game is Pictionary, but I love them all - Trivial Pursuit, Monopoly, Scrabble. We received most of our board games as gifts and my family always shows up to a party with one or another in hand. Case in point - my sister introduced us to Oodles this past weekend and we all had a blast.
I know that some of these items have an initial overhead cost, but at this point in time they are free for us. You can argue, of course, that my cats aren't free because of food, litter, vet bills, etc., but the point is that I don't have to spend any money to do any of these things today. There are plenty of activities I could choose to do that are costly, and I plan to use my list to keep enjoying the simple, free things in life.
I made a list of all my favorite free things to do and stopped at 56 because that's how many lines were on the piece of paper and I am weird like that. I could probably double that, given the time and another sheet of paper. I could bore you with a nice, long, 112 item list, but I figured I'd whittle it down to the top ten. Since I love countdowns and think they're much much better than countups, I present to you, in ascending order, my ten most favorite free things to do.
10. Taking a walk. Little did I know that, when my parents and I would take walks with our dogs years ago, that it was actually fun and useful. I enjoyed it then and I enjoy it now - a nice little stroll down the road or a walk around the park. Lovely.
9. Sledding. Not tubing, sledding. We live next to a golf course with a nice big hill up to the 6th green. I'm sure it's a bugger to play that hole, but it's fun to slide down the hill!
8. Sunbathing. I know, I know, skin cancer. Bad for you. UV rays. But it feels SO GOOD to lay out in the sunshine and feel the sweet breeze on your skin. Since my husband is fair-skinned, I use sunscreen religiously when planning a day out. I most often sunbathe at the beach (obviously) and love to combine it with...
7. Reading a (borrowed) book. Whether borrowed from the library or my darling sister or mom, I rarely buy books, but read as many as I have time to. I have always been big into reading and I go through them pretty quickly, easily losing myself in the story.
6. Sitting by a fire. In the fireplace or an outdoor campfire, I am drawn to a burning pile of logs like, well, a moth to a flame. Something about the crackling wood and the smoke transcends all seasons and is very relaxing. My husband and I have had many heart to hearts while staring into the fires - it makes for some good conversations and removes the everyday hum of technology that seems to surround us.
5. Sleeping. I remember the days when I begged to stay up later than my bedtime. Now, bedtime is something I look forward to every night. I love my bed and the feeling of complete relaxation when I place my head on the pillow.
4. Playing with my Kitties. My two crazy cats are always coming up with something new. Calypso, the older cat loves to jump for toys - I mean back flips. Tango, the baby, has learned how to play fetch with his toys and keeps bringing them back. They just always bring a smile to my face.
3. Snuggling. I love to curl up on the couch with my husband and kitties and watch a movie or just plain be. It's probably the easiest way to unwind after a long day.
2. Taking Pictures. I have always been a take pictures of things and not people kind of girl. I like to carry the camera around and capture whatever catches my eye. While you could argue that this isn't free because you need a camera, we bought ours years ago and use it often enough that the cost per use is very very low.
1. Playing Board Games. This is my favorite thing to do when we have a group of people together. My preferred game is Pictionary, but I love them all - Trivial Pursuit, Monopoly, Scrabble. We received most of our board games as gifts and my family always shows up to a party with one or another in hand. Case in point - my sister introduced us to Oodles this past weekend and we all had a blast.
I know that some of these items have an initial overhead cost, but at this point in time they are free for us. You can argue, of course, that my cats aren't free because of food, litter, vet bills, etc., but the point is that I don't have to spend any money to do any of these things today. There are plenty of activities I could choose to do that are costly, and I plan to use my list to keep enjoying the simple, free things in life.
Sunday, January 13, 2008
Procrastination Costs me Money
I am a horrific procrastinator. I always wait until the last possible second to do anything - clean my house before people come over, finish work before a deadline. I even write my posts right before bed. For some reason, I won't do my tasks until there's pressure. Why do today what can be put off until tomorrow?
I have two possible culprits (excuses) for why I procrastinate so much. One, I was an engineering major in college and learned to operate remarkably well under pressure, which somehow translated to only operating when under pressure. Or it could be the second reason - I have so many things to do that only the mos imperative tasks are done each day. Urgency is a pretty good way to get to the top of my list. Unfortunately, more tasks are added to my to-do list every day and there are a few that keep getting pushed until tomorrow... or the next day... or the next day.
Regardless of the reasoning, there are a few issues that crop up due to my penchant for putting things off. I am always under pressure, which,while I thrive under pressure, can be irritating at times. And it costs me money.
I can think of 2 ways in the past week that I spent money because I procrastinated and didn't plan ahead. I went to the grocery store next to my retail job one night because I didn't get enought food for dinner that night. This store just happens to charge about twice as much for their food than my normal store. But the better example is my husband's birthday last week. On his actual birthday, I bought his present, picked out a card and finished making his cake. Not only could I have saved some money by planning ahead and comparison shopping, I could have gotten his card for free using CVS deals and spent more time with him and less time frosting the cake. Between the two of these I could have saved $7-10.
But these are just small examples. In the past, I have paid credit cards late and missed other payments by putting them off. While I haven't done that in quite some time (my one error notwithstanding), I'm still not quite organized or efficient enough to maximize my money. But I'm getting there. The first step is to admit you have a problem. :) Now to go about solving it...
I have two possible culprits (excuses) for why I procrastinate so much. One, I was an engineering major in college and learned to operate remarkably well under pressure, which somehow translated to only operating when under pressure. Or it could be the second reason - I have so many things to do that only the mos imperative tasks are done each day. Urgency is a pretty good way to get to the top of my list. Unfortunately, more tasks are added to my to-do list every day and there are a few that keep getting pushed until tomorrow... or the next day... or the next day.
Regardless of the reasoning, there are a few issues that crop up due to my penchant for putting things off. I am always under pressure, which,while I thrive under pressure, can be irritating at times. And it costs me money.
I can think of 2 ways in the past week that I spent money because I procrastinated and didn't plan ahead. I went to the grocery store next to my retail job one night because I didn't get enought food for dinner that night. This store just happens to charge about twice as much for their food than my normal store. But the better example is my husband's birthday last week. On his actual birthday, I bought his present, picked out a card and finished making his cake. Not only could I have saved some money by planning ahead and comparison shopping, I could have gotten his card for free using CVS deals and spent more time with him and less time frosting the cake. Between the two of these I could have saved $7-10.
But these are just small examples. In the past, I have paid credit cards late and missed other payments by putting them off. While I haven't done that in quite some time (my one error notwithstanding), I'm still not quite organized or efficient enough to maximize my money. But I'm getting there. The first step is to admit you have a problem. :) Now to go about solving it...
Friday, January 11, 2008
Prioritizing Your Money
Budgeting money is all about prioritizing. Some of it is obvious - pay the mortgage before you pay for cable, buy food before you buy new clothes. I've been in the situation where you have to play bill roulette to determine which bill gets paid this week. Not fun. Fortunately, those times have passed (never to be seen again!) and we have a lot more choices to make with our money.
Once all the bills are covered and all essentials are met, we must make a decision. I come across these decision every day. I am not one of those people who naturally doesn't spend money. I have to stop myself from buying things daily. Whether I'm at the grocery store, at work, or driving by a restaurant, I always want to spend our money. I allow myself a little bit of "fun money" every month to spend on these trivial things, but ultimately the rest of our money goes toward our financial goals.
Even within our goals, we need to prioritize. The credit card debt has always been our highest priority, however, we have a no interest credit card that currently holds just under half our debt. The 0% interest ends in September, so I want to make sure we have it paid off before any interest kicks in. Hopefully we will have the remainder of the credit card debt paid off in March. So what to do with the six months in between?
The mathematically logical thing to do would be to start on our other goals while making minimum payments on the 0% card and then paying off the credit card just before the deadline. The psychological thing to do is to pay off the credit card completely as soon as we can. My plan is somewhere in the middle.
I want to make sure that everything is paid off with time to spare before the interest would kick in. I'm not very good at being on time, and this is very important not to miss. My goal is to pay off the 0% credit card by the end of August. In the time between March and August, I am going to split our non-essential money among three categories:
1. The 0% Credit Card
2. Emergency Fund
3. Retirement.
Opening my 401(k) won't take a huge chunk of my income, but the earlier I do it, the sooner I start making money on my investments. The rest of the money will be split evenly between the credit card and the emergency fund. If all goes well, the credit card will be paid off in August (or before!) by using half of our allocated non-essential monies alone. However, if we need it, come August 31 we can use the money in the emergency fund to pay off the balance before it accrues any interest, without completely depleting our savings.
This way we can work towards more than one goal at a time. I thought about splitting the money between the 0% credit card and the dreaded 2nd mortgage, but that would leave us high and dry if an emergency comes around. Hopefully, all goes smoothly, but we know how likely that is! :)
Once all the bills are covered and all essentials are met, we must make a decision. I come across these decision every day. I am not one of those people who naturally doesn't spend money. I have to stop myself from buying things daily. Whether I'm at the grocery store, at work, or driving by a restaurant, I always want to spend our money. I allow myself a little bit of "fun money" every month to spend on these trivial things, but ultimately the rest of our money goes toward our financial goals.
Even within our goals, we need to prioritize. The credit card debt has always been our highest priority, however, we have a no interest credit card that currently holds just under half our debt. The 0% interest ends in September, so I want to make sure we have it paid off before any interest kicks in. Hopefully we will have the remainder of the credit card debt paid off in March. So what to do with the six months in between?
The mathematically logical thing to do would be to start on our other goals while making minimum payments on the 0% card and then paying off the credit card just before the deadline. The psychological thing to do is to pay off the credit card completely as soon as we can. My plan is somewhere in the middle.
I want to make sure that everything is paid off with time to spare before the interest would kick in. I'm not very good at being on time, and this is very important not to miss. My goal is to pay off the 0% credit card by the end of August. In the time between March and August, I am going to split our non-essential money among three categories:
1. The 0% Credit Card
2. Emergency Fund
3. Retirement.
Opening my 401(k) won't take a huge chunk of my income, but the earlier I do it, the sooner I start making money on my investments. The rest of the money will be split evenly between the credit card and the emergency fund. If all goes well, the credit card will be paid off in August (or before!) by using half of our allocated non-essential monies alone. However, if we need it, come August 31 we can use the money in the emergency fund to pay off the balance before it accrues any interest, without completely depleting our savings.
This way we can work towards more than one goal at a time. I thought about splitting the money between the 0% credit card and the dreaded 2nd mortgage, but that would leave us high and dry if an emergency comes around. Hopefully, all goes smoothly, but we know how likely that is! :)
Friday, January 4, 2008
New Year's Eve Bait and Switch
This past weekend, my husband and I drove down to his parent's house to celebrate Christmas, New Year's, and both of our birthdays with them. On New Year's Eve, we drove into Baltimore to go to their Spectacular, complete with live music and fireworks.
We decided to go out to diner before the fireworks, and called the day before to make reservations. When I gave the restaurant my name, they also took a credit card number to hold the table and noted that, should we cancel our reservation, it would be charged $50. This should have been my first hint that trouble was afoot. Naively, I thought they needed to take credit cards because it was a busy night and didn't want to be holding a table for people who weren't going to show up. While I'm sure that was a part of it, there was more to it.
Before we went into Baltimore, I checked out the menu on the restaurant's website. The entrees ranged from $18-$40, which is much more than we usually spend. However, we knew that this was a special occasion and had prepared for it. I picked out a meal before we went for $21, planned to have one drink and then switch to water, and figured I was golden.
When we got to the restaurant, it was an entire different story. We pranced in and were told they were using a special menu for the night. OK, no big deal, I can pick something else to eat. Until I saw the menu. Then I freaked out.
Everything on the menu was a package - appetizer, entree, dessert, soft drink, coffee & champagne toast. There was no option to just pick an entree and call it a night. Worst of all - the cheapest package was $53. Our cost had essentially doubled and there was nothing we could do about it.
We considered leaving, but the $50 hold on the credit card made it pretty pointless to do so - any other place we chose to eat would cost about $50 and, with the credit card hold, we'd be right back at square one. So we stayed and chose to enjoy ourselves instead of getting angry and ruining the night. And you had better believe we got every single thing offered as an option.
The restaurant really handled the situation poorly. First of all, it was way too much food for one person to eat. Generally we split an appetizer or a dessert, never mind each ordering our own of both. I was bursting at the seams after eating everything out of spite. In addition, there was no mention on the website or when I called to make the reservation of the special menu with the higher prices. I really feel like we were duped and tricked into spending more money than we normally would. I'm not sure what the advantage of this is for the restaurant - obviously, the make more money, but we couldn't have been the only ones who felt tricked. It has turned me off to that restaurant and eating out in general - which, I suppose is good for the budget in the long run. I'm sure that won't last too long!
Afterwards, the fireworks were Spectacular!
We decided to go out to diner before the fireworks, and called the day before to make reservations. When I gave the restaurant my name, they also took a credit card number to hold the table and noted that, should we cancel our reservation, it would be charged $50. This should have been my first hint that trouble was afoot. Naively, I thought they needed to take credit cards because it was a busy night and didn't want to be holding a table for people who weren't going to show up. While I'm sure that was a part of it, there was more to it.
Before we went into Baltimore, I checked out the menu on the restaurant's website. The entrees ranged from $18-$40, which is much more than we usually spend. However, we knew that this was a special occasion and had prepared for it. I picked out a meal before we went for $21, planned to have one drink and then switch to water, and figured I was golden.
When we got to the restaurant, it was an entire different story. We pranced in and were told they were using a special menu for the night. OK, no big deal, I can pick something else to eat. Until I saw the menu. Then I freaked out.
Everything on the menu was a package - appetizer, entree, dessert, soft drink, coffee & champagne toast. There was no option to just pick an entree and call it a night. Worst of all - the cheapest package was $53. Our cost had essentially doubled and there was nothing we could do about it.
We considered leaving, but the $50 hold on the credit card made it pretty pointless to do so - any other place we chose to eat would cost about $50 and, with the credit card hold, we'd be right back at square one. So we stayed and chose to enjoy ourselves instead of getting angry and ruining the night. And you had better believe we got every single thing offered as an option.
The restaurant really handled the situation poorly. First of all, it was way too much food for one person to eat. Generally we split an appetizer or a dessert, never mind each ordering our own of both. I was bursting at the seams after eating everything out of spite. In addition, there was no mention on the website or when I called to make the reservation of the special menu with the higher prices. I really feel like we were duped and tricked into spending more money than we normally would. I'm not sure what the advantage of this is for the restaurant - obviously, the make more money, but we couldn't have been the only ones who felt tricked. It has turned me off to that restaurant and eating out in general - which, I suppose is good for the budget in the long run. I'm sure that won't last too long!
Afterwards, the fireworks were Spectacular!
Friday, December 28, 2007
FSA: Use it or Lose it?
I have a medical expense FSA, or flexible spending account, set up through work. I use it mostly for co-pays at various doctor and dentist appointments, any medicine, and contacts. For 2007 I set it at $500, which turned out to be pretty close to my actual usage.
The thing that I don't know is whether or not I have to use the rest of the money - $64.15 - by December 31.
Because the money set aside for the FSA (or in my case, on a debit card) is not subject to payroll taxes, it has a coverage period or "plan year". In general, the plan year is the calendar year. However, in 2005, the IRS authorized an optional 2 1/2 month grace period that employers can offer, extending the "plan year" through March 15, 2008. I just don't know if my employer does this.
Seems like a little thing that I should easily be able to find, right? When my money is forfeit? I have already received my new FSA debit card for 2008 and my husband needs a new pair of glasses - if my 2007 FSA extended into 2008, then I could use that $64.15 towards the glasses and pay for the rest with the 2008 FSA. But I can't find anywhere the date my "plan year" ends. So I have to assume that it ends on December 31, 2007. I would rather use my money than forfeit it accidentally.
So today I bought 3 new boxes of contacts for us, as they won't expire for many years. Using a free shipping coupons I found online, the total came to $62.38, which leaves me with $1.77 left to use on my card. I just need to run to CVS and find something small to use the rest of it up!
The thing that I don't know is whether or not I have to use the rest of the money - $64.15 - by December 31.
Because the money set aside for the FSA (or in my case, on a debit card) is not subject to payroll taxes, it has a coverage period or "plan year". In general, the plan year is the calendar year. However, in 2005, the IRS authorized an optional 2 1/2 month grace period that employers can offer, extending the "plan year" through March 15, 2008. I just don't know if my employer does this.
Seems like a little thing that I should easily be able to find, right? When my money is forfeit? I have already received my new FSA debit card for 2008 and my husband needs a new pair of glasses - if my 2007 FSA extended into 2008, then I could use that $64.15 towards the glasses and pay for the rest with the 2008 FSA. But I can't find anywhere the date my "plan year" ends. So I have to assume that it ends on December 31, 2007. I would rather use my money than forfeit it accidentally.
So today I bought 3 new boxes of contacts for us, as they won't expire for many years. Using a free shipping coupons I found online, the total came to $62.38, which leaves me with $1.77 left to use on my card. I just need to run to CVS and find something small to use the rest of it up!
Thursday, December 27, 2007
Spending Relapse
As I alluded to earlier, the budget has slipped in December. Big time. I'm embarrassed to admit it, too embarrassed even to look up how bad the numbers are. All I know is this: in December, all we paid to our credit cards debt was the minimum payments. On top of that, we had covered our December minimum payment towards the Discover card with our November payments, so we didn't even put anything towards that debt. Our grand total towards the credit cards in December was $198. Somewhere, the credit card companies are cackling with glee.
As I predicted in November, the month of December was really tough. I was really quite busy and didn't pay attention to our finances hardly at all - just enough to pay the bills. No budgeting, no coupons, lots of buying. Most of the shopping was for Christmas gifts and related items, but those budgets there were still *ahem* broken. And we went out to eat quite a few times throughout the month. I am such a bad example! Maybe I'm a what not to do?
The good news is that we didn't use our credit cards. At all. Christmas, while expensive, was all cash.
All these add up to a disastrous December for debt payoff. I think the kicker is that when I allocate money towards a certain budget category (like Christmas gifts), but I don't spend it right away, I throw it toward the debt. So some of the credit card payments in November should have been made in December. I don't know if I prefer it this way or if I would rather have a sub-accounting system to allocate my money towards its final destination. I know that when we get a savings account, I will need sub-accounts to keep track of it all.
I need some ideas- when you have money to use a certain way, but not immediately, where do you put it? How do you keep from using it for something else?
As I predicted in November, the month of December was really tough. I was really quite busy and didn't pay attention to our finances hardly at all - just enough to pay the bills. No budgeting, no coupons, lots of buying. Most of the shopping was for Christmas gifts and related items, but those budgets there were still *ahem* broken. And we went out to eat quite a few times throughout the month. I am such a bad example! Maybe I'm a what not to do?
The good news is that we didn't use our credit cards. At all. Christmas, while expensive, was all cash.
All these add up to a disastrous December for debt payoff. I think the kicker is that when I allocate money towards a certain budget category (like Christmas gifts), but I don't spend it right away, I throw it toward the debt. So some of the credit card payments in November should have been made in December. I don't know if I prefer it this way or if I would rather have a sub-accounting system to allocate my money towards its final destination. I know that when we get a savings account, I will need sub-accounts to keep track of it all.
I need some ideas- when you have money to use a certain way, but not immediately, where do you put it? How do you keep from using it for something else?
Wednesday, November 28, 2007
Commission Backslide Part 2
I did it. I sent the nasty-gram to try and save my $2500. Thanks for all the support and cross your fingers for me!
Buy.com $10 off coupon = free stuff
I saw this at Moneysavingmom.com and wanted to share. If you sign up for Google Checkout, you get $10 off a purchase at buy.com. I signed up and bought a USB flash drive for tax only and free shipping. Then I signed up using another email account and bought a Christmas present (for someone who reads this blog) for $7 less than I found it on Amazon and eBay, also with free shipping! YAY!
All $10 items that are free with this promo.
The USB flash drive I bought.
Many thanks to MoneySavingMom and her readers. I just started reading her website today, and I am so glad I did!!
All $10 items that are free with this promo.
The USB flash drive I bought.
Many thanks to MoneySavingMom and her readers. I just started reading her website today, and I am so glad I did!!
Saturday, November 17, 2007
Absolutely Free and Almost Free GIfts
Just in time for the holidays, Are You Going to be This Way the Rest of the Time I Know You? posted a challenge: to come up with 5 completely free and 5 almost free gifts. This is a great way to challenge yourself to come up with useful gift ideas that won't break your budget instead of just running out and buying the latest gadget.
Absolutely free gifts (can count items you already have around the house):
1. Stocking stuffer samples: I get a lot of free samples throughout the year from places like Walmart.com for mostly toiletries like deodorant, toothpaste and the like. Perfect size to stick in a stocking! I'm even giving my husband some to give back to me in my stocking. :) One tip: use a secondary email address on the form to avoid spam.
2. Day at the park: Plan a day with someone you love and the great outdoors. If you're in the snowy north like myself, go sledding and then make some hot cocoa. In a warmer climate, google some local wildlife and go find the animals.
3. Mix tape: Go old fashioned and make a custom compilation for your friends or family. Of course, I have a bunch of blank CD's hanging around and loads of songs on iTunes.
4. Giveaways: While rare, there are occasions when the freebie handed out at promotional events are actually good. A cool t-shirt or even a stress ball would be a great gift for a kid.
5. Re-gift card: With one of my credit cards, we can claim our rewards in the form of gift cards to restaurants or stores. You can either give away the gift card or use it to buy presents. We often get $25 gift certificates to Amazon.com and use them to buy books, DVDs, CDs, pretty much anything.
BONUS - Rescue a pet: There are plenty of dogs and cats available at the pound or posted in the newspaper that are initially free. Of course, there is food, vet bills, and supplies later on. Imagine the look on your child's face when they open a box with a puppy in it! Instant classic.
Caveat: don't give a pet without either discussing it with the recipient or being prepared to care for the pet yourself. I surprised my husband with a kitten that was found behind my mom's restaurant after we'd talked about getting one for ages. They get along pretty well:
Almost free gifts (under $10, hopefully under $5):
1. Mix in a Jar: A popular cheap gift favorite. Basically it's all the dry ingredients for a recipe layered in a jar with instructions to make the recipe. I am making the double fudge brownie in cute little snowman jars that I bought for $2.24 each.
2. Dinner on Us: Offer a busy couple dinner with all the fixings at their house, from set up to clean up. If you plan it well, it can cost less than $5 total. A favorite of mine is baked ziti.
3. Super Clearance: Throughout the year, there are special deals and steals online and radical markdowns in stores on discontinued merchandise. I was able to snag a few such deals, both at about 99.5% off. I would post details, but I don't want to spoil the surprise!
4. Custom Web Design: My husband used to work in web design and we have a server in our basement. For the low, low price of $9.95, we bought a domain name for my parents and set them up with their own website for their photos. They keep it going and love posting all their pictures.
5. Cozy Fire in a Basket: Nothing beats curling up by the fire on a cold winter night, so why do so many fireplaces go unused? Because it's a pain in the butt to gather the wood and build a fire. So invest in some firewood, divide it up and include some kindling (gathered in the woods) and matches. If you have a little extra money, buy a cheap wood carrier and wrap it all up together.
There are all my ideas for saving money on gift giving this holiday season. I have used a few in the past and plan on using more this year. Make sure to check out the original list and the list at Paid Twice for more ideas!
Absolutely free gifts (can count items you already have around the house):
1. Stocking stuffer samples: I get a lot of free samples throughout the year from places like Walmart.com for mostly toiletries like deodorant, toothpaste and the like. Perfect size to stick in a stocking! I'm even giving my husband some to give back to me in my stocking. :) One tip: use a secondary email address on the form to avoid spam.
2. Day at the park: Plan a day with someone you love and the great outdoors. If you're in the snowy north like myself, go sledding and then make some hot cocoa. In a warmer climate, google some local wildlife and go find the animals.
3. Mix tape: Go old fashioned and make a custom compilation for your friends or family. Of course, I have a bunch of blank CD's hanging around and loads of songs on iTunes.
4. Giveaways: While rare, there are occasions when the freebie handed out at promotional events are actually good. A cool t-shirt or even a stress ball would be a great gift for a kid.
5. Re-gift card: With one of my credit cards, we can claim our rewards in the form of gift cards to restaurants or stores. You can either give away the gift card or use it to buy presents. We often get $25 gift certificates to Amazon.com and use them to buy books, DVDs, CDs, pretty much anything.
BONUS - Rescue a pet: There are plenty of dogs and cats available at the pound or posted in the newspaper that are initially free. Of course, there is food, vet bills, and supplies later on. Imagine the look on your child's face when they open a box with a puppy in it! Instant classic.
Caveat: don't give a pet without either discussing it with the recipient or being prepared to care for the pet yourself. I surprised my husband with a kitten that was found behind my mom's restaurant after we'd talked about getting one for ages. They get along pretty well:
Almost free gifts (under $10, hopefully under $5):
1. Mix in a Jar: A popular cheap gift favorite. Basically it's all the dry ingredients for a recipe layered in a jar with instructions to make the recipe. I am making the double fudge brownie in cute little snowman jars that I bought for $2.24 each.
2. Dinner on Us: Offer a busy couple dinner with all the fixings at their house, from set up to clean up. If you plan it well, it can cost less than $5 total. A favorite of mine is baked ziti.
3. Super Clearance: Throughout the year, there are special deals and steals online and radical markdowns in stores on discontinued merchandise. I was able to snag a few such deals, both at about 99.5% off. I would post details, but I don't want to spoil the surprise!
4. Custom Web Design: My husband used to work in web design and we have a server in our basement. For the low, low price of $9.95, we bought a domain name for my parents and set them up with their own website for their photos. They keep it going and love posting all their pictures.
5. Cozy Fire in a Basket: Nothing beats curling up by the fire on a cold winter night, so why do so many fireplaces go unused? Because it's a pain in the butt to gather the wood and build a fire. So invest in some firewood, divide it up and include some kindling (gathered in the woods) and matches. If you have a little extra money, buy a cheap wood carrier and wrap it all up together.
There are all my ideas for saving money on gift giving this holiday season. I have used a few in the past and plan on using more this year. Make sure to check out the original list and the list at Paid Twice for more ideas!
Saturday, November 10, 2007
October Round Up
Even though we're 1/3 of the way into November, I shouldn't neglect poor old October just because I've been busy. So onto the wrap-up!
October, being a long month, is pretty challenging. Add on to that the fact that My brother, brother-in-law and sister have birthdays within a week of each other at the end of October, and the budget gets a little strained. But, fortunately, we have a little stretch in our budget.
This month we paid $1836.29 towards our credit card debt, which is $934.71 short of our goal. However, we made huge mental progresses and paid off our worst debt, that we've been working on since February. At the end of October, we have paid off 57% of our total credit card debt, up 4 percentage points from September. Our motivation has really picked up as well.
My income was finally over for October (by $658.30, thanks to extra hours and commissions), which will be extremely useful in keeping our November numbers on track. Our gas expenses were over by $30.87, which is essentially one fill-up and due to some bad timing of getting gas on Halloween. Should have waited one day! Our groceries were over by $19.53, and our fun money by $22.28, which totally disproves my theory of fudging the budget. I guess that's what happens when you try to cheat the system.
As for the emergency fund... I set up a high interest bank account, and then never transferred the money over. It's still waiting patiently in my checking account. This is a high priority on my to-do list this week.
While the numbers look OK, I'm pretty disappointed in myself. We pay a lot of money toward our debt each month, but nowhere near our goal of $3000. I have $2771.00 budgeted toward debt payment each month and try to make up the difference, but the last time we hit our goal of $3000 was in June. Not that much has changed in our finances that we shouldn't be getting to that number. I think we were just burnt out from being in super frugal mode that we rebelled a little. Not to mention a few mistakes along the way. Paying off our line of credit and transferring to the 0% card were huge for our motivation and will get us back in the fast lane. Same old story and I need to put my money where my mouth is. November is off to a great start with the extra paycheck and already making a big payment, so I am feeling very positive moving forward. Hopefully planning ahead for Christmas will prevent any bumps in the road.
October, being a long month, is pretty challenging. Add on to that the fact that My brother, brother-in-law and sister have birthdays within a week of each other at the end of October, and the budget gets a little strained. But, fortunately, we have a little stretch in our budget.
This month we paid $1836.29 towards our credit card debt, which is $934.71 short of our goal. However, we made huge mental progresses and paid off our worst debt, that we've been working on since February. At the end of October, we have paid off 57% of our total credit card debt, up 4 percentage points from September. Our motivation has really picked up as well.
My income was finally over for October (by $658.30, thanks to extra hours and commissions), which will be extremely useful in keeping our November numbers on track. Our gas expenses were over by $30.87, which is essentially one fill-up and due to some bad timing of getting gas on Halloween. Should have waited one day! Our groceries were over by $19.53, and our fun money by $22.28, which totally disproves my theory of fudging the budget. I guess that's what happens when you try to cheat the system.
As for the emergency fund... I set up a high interest bank account, and then never transferred the money over. It's still waiting patiently in my checking account. This is a high priority on my to-do list this week.
While the numbers look OK, I'm pretty disappointed in myself. We pay a lot of money toward our debt each month, but nowhere near our goal of $3000. I have $2771.00 budgeted toward debt payment each month and try to make up the difference, but the last time we hit our goal of $3000 was in June. Not that much has changed in our finances that we shouldn't be getting to that number. I think we were just burnt out from being in super frugal mode that we rebelled a little. Not to mention a few mistakes along the way. Paying off our line of credit and transferring to the 0% card were huge for our motivation and will get us back in the fast lane. Same old story and I need to put my money where my mouth is. November is off to a great start with the extra paycheck and already making a big payment, so I am feeling very positive moving forward. Hopefully planning ahead for Christmas will prevent any bumps in the road.
Thursday, October 18, 2007
Great Groceries
I usually like to do my grocery shopping on the weekend, so I can take my time and enjoy it (weird, I know). I don't get to do a lot of shopping, so groceries are pretty much it. This past weekend, however, things were a little crazy, so I didn't get to go until Monday nighthic.
At Stop & Shop, I was kicking butt and taking names. I made my list beforehand, including some great sales they had. This week they had chicken breasts for $1.79/lb, pork tenderloin for $1.99/lb and italian sausage for $1.99/lb. I bought a total of $27.97 on meat this week. I saved a total of $19.37 on meat this week. This is why I only buy the meat that is on sale. :)
The other thing that saved my grocery list is I didn't buy any deli meat. All our lunches this week have been leftovers. When I plan ahead like this, it really pays off. We spent $70.56 in groceries this week, which is below our budget 0f $75.00. We're going to end up low in the grocery budget for October (I hope), so I am planning on fudging a little of that in with out fun money (more on that in a later post). My stomach and my freezer are both full and happy!
At Stop & Shop, I was kicking butt and taking names. I made my list beforehand, including some great sales they had. This week they had chicken breasts for $1.79/lb, pork tenderloin for $1.99/lb and italian sausage for $1.99/lb. I bought a total of $27.97 on meat this week. I saved a total of $19.37 on meat this week. This is why I only buy the meat that is on sale. :)
The other thing that saved my grocery list is I didn't buy any deli meat. All our lunches this week have been leftovers. When I plan ahead like this, it really pays off. We spent $70.56 in groceries this week, which is below our budget 0f $75.00. We're going to end up low in the grocery budget for October (I hope), so I am planning on fudging a little of that in with out fun money (more on that in a later post). My stomach and my freezer are both full and happy!
Friday, September 21, 2007
Adventures in Grocery Shopping
One of the two most common pieces of advice to keeping your grocery bill within budget is to make a list and stick to it. The other is to shop alone, leaving kids and spouses at home. The last trip to the store I broke all the rules. Danger is my middle name.
I won't pretend I wasn't afraid. But I went bravely into battle with my sword (the monthly circular) and shield (extra room in this month's budget). At the end of the trip, I emerged victorious! The grand total came to $71.07, under my weekly budget of $75. Without a list or a plan!
I think the trick to doing well without my usual half hour of planning is simply knowing the good prices. I bought a lot of meat on sale, including chicken breast for $1.99/lb and pot roast for $1.99/lb. I didn't buy any items that we don't buy on a regular basis. Even better, I have almost enough food to last me for the rest of September, so I will be plenty under the grocery budget. Woo! After the credit card and car setbacks, I am psyched to have some good news.
I won't pretend I wasn't afraid. But I went bravely into battle with my sword (the monthly circular) and shield (extra room in this month's budget). At the end of the trip, I emerged victorious! The grand total came to $71.07, under my weekly budget of $75. Without a list or a plan!
I think the trick to doing well without my usual half hour of planning is simply knowing the good prices. I bought a lot of meat on sale, including chicken breast for $1.99/lb and pot roast for $1.99/lb. I didn't buy any items that we don't buy on a regular basis. Even better, I have almost enough food to last me for the rest of September, so I will be plenty under the grocery budget. Woo! After the credit card and car setbacks, I am psyched to have some good news.
Thursday, September 13, 2007
The best souvenirs are inexpensive
When I travel, it's on a budget. (Surprised?) But of course, I still like to get a few things to remind me of my trip. The last vacation I went on, a Caribbean cruise in February, I budgeted $200 for souvenirs and spent $203, including gifts and bottles of alcohol (cheaper in the Caribbean!). Here are my tips for great souvenirs on the cheap:
Buy local goods. No need to buy the same T-shirt branded with a different location. Get something that's really original. A great example of this is local food or liquor. When we were in St. Maarten on our honeymoon, we brought back local Guavaberry Rum, which we've never seen anywhere else. Last week my husband came home from his business trip in Hawaii with chocolate covered macadamia nuts. He bought them at Sam's club for $14.
Check out art. Here's something that will last forever and always remind you of your trip. The best part of buying a piece of local art is that it's authentic and unique. Often times you'll find pieces that are handmade. Not to mention that you're supporting local businesses, rather than imported goods mass produced.
Bargain, bargain, bargain. Lots of the best pieces are found in small shops. You can almost always get a better price on the pieces you find. The trick is knowing what you want to spend, then offering less than that so you settle on the price you have in mind.
Have a signature souvenir. Everywhere we go, my husband and I pick up a locally brewed beer, save the bottle and fill it with sand (or when we go skiing - snow). Since we would be buying the beer anyway, we get a great addition to our collection and they only cost $2 or $3. Similarly, my dad collects shot glasses from all his destinations. Other ideas could be key chains, magnets, spoons - anything that you enjoy and can find uniquely. They often cost very little and help assuage the need to buy something.
Make a budget and stick to it. Be realistic and disciplined. It's easy to get out of control when you're on vacation, but eventually you have to return to reality - and you don't want the souvenir of credit card debt to come with you. I use a cash system for souvenirs, and when it's up, it's up.
Buy local goods. No need to buy the same T-shirt branded with a different location. Get something that's really original. A great example of this is local food or liquor. When we were in St. Maarten on our honeymoon, we brought back local Guavaberry Rum, which we've never seen anywhere else. Last week my husband came home from his business trip in Hawaii with chocolate covered macadamia nuts. He bought them at Sam's club for $14.
Check out art. Here's something that will last forever and always remind you of your trip. The best part of buying a piece of local art is that it's authentic and unique. Often times you'll find pieces that are handmade. Not to mention that you're supporting local businesses, rather than imported goods mass produced.
Bargain, bargain, bargain. Lots of the best pieces are found in small shops. You can almost always get a better price on the pieces you find. The trick is knowing what you want to spend, then offering less than that so you settle on the price you have in mind.
Have a signature souvenir. Everywhere we go, my husband and I pick up a locally brewed beer, save the bottle and fill it with sand (or when we go skiing - snow). Since we would be buying the beer anyway, we get a great addition to our collection and they only cost $2 or $3. Similarly, my dad collects shot glasses from all his destinations. Other ideas could be key chains, magnets, spoons - anything that you enjoy and can find uniquely. They often cost very little and help assuage the need to buy something.
Make a budget and stick to it. Be realistic and disciplined. It's easy to get out of control when you're on vacation, but eventually you have to return to reality - and you don't want the souvenir of credit card debt to come with you. I use a cash system for souvenirs, and when it's up, it's up.
Monday, September 10, 2007
I love grocery shopping even more than ever
I am rocking the grocery shopping in September. We're 10 days in and I have only spent about $66. Since I go shopping for the week on Sunday, I have enough food to last me through the 14th or 15th. On $66.
I know, there are a ton of reasons why things are so far under budget. My husband was away on business the whole first week of September. I've eaten a few meals at my parent's house. I pulled things out of the freezer. I tend to cook less for one, so I've been eating simple pasta meals or sandwiches recently.
I was kind of expecting this week to cost more, though. I made a list almost haphazardly, figuring I already had some extra money to play with. I didn't even stick to my list. I did buy meat on sale and stay away from the processed foods, but still.
So now I am going to try to see how much under budget I can make it. I am shooting for $100 under budget. We did incur additional travel expenses when my husband was away, so this would even it out. Or maybe I'll put it aside to save for Christmas shopping. We'll see where the debt payoff is at the end of the month.
I know, there are a ton of reasons why things are so far under budget. My husband was away on business the whole first week of September. I've eaten a few meals at my parent's house. I pulled things out of the freezer. I tend to cook less for one, so I've been eating simple pasta meals or sandwiches recently.
I was kind of expecting this week to cost more, though. I made a list almost haphazardly, figuring I already had some extra money to play with. I didn't even stick to my list. I did buy meat on sale and stay away from the processed foods, but still.
So now I am going to try to see how much under budget I can make it. I am shooting for $100 under budget. We did incur additional travel expenses when my husband was away, so this would even it out. Or maybe I'll put it aside to save for Christmas shopping. We'll see where the debt payoff is at the end of the month.
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