Hello, January, I remember you now...

Here it is, the fifth day of the new year and my new spending diet, and already this month is a wash.  Every year I somehow forget that January is inevitably the worst financial month of the year for us.  The car inevitably needs repairs that you hoped would cost two hundred but end up more like six, memberships to organizations that you forgot you belonged to but really want to continue come due, the homeowners' association wants their fee... The list seems to go on.  All I get in the mail are more people wanting money that I forgot they were going to ask for (even though they want it every year).  So that extra $261 that I found by scrimping on all other aspects of our life and was so sure I could apply to debt and really make some headway this year is gone before I ever saw it, plus some.  Saving money and paying off debt can be such a frustrating process sometimes.  Of course it can be most rewarding as well, but January definitely leans more on the frustrating side.

I used to completely panic come January.  Now I only mildly panic.  I've come to realize that money is just money.  There are so many more important things in life.  My children, my marriage, my health.  All of these things will suffer if I spend all my time in a state of panic.  So I just figure out what is most important to pay, pay it now, and worry about the rest next month.  In the end that's all you can do.  You can freak out about how everything is due right now, freak out about how therefore things will be overdue later, freak out about how you are so poor and will never make any headway on your debt, and just freak out about any and everything, but that's not going to put any more money in your bank account.  It's not going to make bills go away.  So it's best to just accept it all and move on.

That's what I'm doing now:  just accepting and moving on.  And remembering that as soon as this month ends, February will begin and that will bring license plate renewals and lord knows what else...  sigh...

new year, new plan

So I decided this year would bring a spending diet to our home.  We have to go through these occasionally.  Kind of a detox.  And right now couldn't be a better time, as we have quite the hole to dig ourselves out of.  The figures that we're starting our new year with:

Credit cards: $459.73  (hey, that's not so bad, right?  nothing you can't pay off in a couple of months.  oh, but then it gets worse.....)
Student loans: $36,016.34  (yikes!)
We also have a mortgage in there, but I think for right now this is enough to deal with.  Adding any more might give me a heart attack, and then nothing will get paid.

I honestly did not even realize the student loans were quite that high.  It kind of makes me throw up a little when I look at it.  BUT, you have to be brutally honest with yourself in order to make a change, right?  So this year is all about change.  Mostly as in the spare change we will be counting in order to buy our beans and rice, because all of our real money will be devoted to paying off debt!

My main weapon here is forcing myself to question the things I buy.  I considered spending the next year in complete deprivation, really living off of beans and rice and using free deodorant samples to avoid purchasing anything.  But then I realized that, like a crash diet, that only works for a few weeks, and then you binge.  I would really rather not binge.  It just makes me feel yucky the next day.  So rather than deny my family EVERYTHING, we're more focusing on buying things that we need and will actually use.  It's very eye opening to go through the Sunday paper ads with the question, "do we really need this?" prevalent with every good deal.  I never realized how much junk I would buy because it was a good deal, even if it wasn't necessary.

Here's the thing:  I own clothes in every size from 5 to 15 for every season.  I own about ten purses (yet have been using the same one for about three years).  I don't even know how many shoes I have, but I do know that I only wear three pairs of them.   And I don't work so I don't really need to look that stylish at any time.  So I'm good on the clothes front.  I do not NEED a single article of clothing at any point in the next year (even if Old Navy puts those wonderful tank tops on sale for $3 each again).  There are so many things like that.

We are very blessed to have the things we need.  So this year the only things we really and truly need are food, probably some clothes for the boys to replace outgrown things, and gardening supplies.  And in those categories it is still a struggle to figure out what are needs (milk, flour, beans, rice, etc.) and what are wants (fruit roll-ups).  I am still working on my list of the items I deem necessary to live a decent life and the items that are absolutely frivolous.  I think this is a list that is different for everyone.  I mean sure if you wanted to live like a monk you would get rid of all processed and convenience foods.  You would never buy ice cream or Cheerios or Coke Zero.  But I just cannot live that way.  I am willing to make some sacrifices and maybe treat those items more as special treats than weekly necessities, but will I be giving them up for the entire year?  Ummm, no.

There is clearly so much more to write about but I must go scour the internet for free stuff so I won't feel totally deprived.  Remember to always ask yourself if you really need it, and happy budgeting.

Goodbye Target?

This morning in the shower I was thinking of ways to save money in the coming year.  With the new year starting soon, it actually is the perfect time to do this.  Often I get on these kicks in the summer, and it is really hard for me to start something new at the wrong time.  Like, if I want to do a twelve month experiment such as this, I cannot go from July to July, I just think, "oh, I'll start in January."  It's just an excuse, but it's an excuse I don't have this time.

So this morning I'm in the shower and I'm thinking and I'm reminded of this book I read a couple of years ago, Not Buying It.  I love this book.  It was the inspiration for our living more simply the first time.  In this book the author and her partner make a commitment to drop out of consumerism for a year in order to pay down their credit cards.  And, as I'm taking a shower in preparation for an outing to Target (after my outing to Wal-Mart yesterday), I think, "do I really need whatever it is I'm going to buy at Target?"  Probably not. As far as food goes, I have a pantry full and a freezer half full.  All of us have closets and drawers full of clothes.  And no one needs more DVDs, Blu-Rays, or video games.  And I'm in the shower looking at the array of fine smelling shower gels lining the tub and remembering how when I was a kid I got a bar of Ivory soap and some Suave shampoo.

I pride myself in our lifestyle.  I feel that we spend a lot less money than most people.  We don't have a car payment (though both cars are on their last legs, so there is a threat that a car payment may be imminent), we don't have cable (though we do pay $10 a month for Netflix), we only eat out about once a week.  But really, there are so many ways in which we could stop spending money without it really hurting our lifestyle.  We buy just to be buying.  Sure, our expenditures are at Target and Wal-mart instead of high end establishments, but they're expenditures all the same.

So today my goal is to come up with a list of guidelines for the following year.  Will my husband like it? No, he will not.  But I'm thinking if he saw our budget and checking account balance as much as I do, he would like those even less.  So wish me luck as I come up with my list, which hopefully will not include too many easy outs.

OK, OK, luckily I only have one follower!

Yeah, yeah, so the 25 day thing didn't work so well.  Let's just let it go now and move on to bigger and brighter things....

It's the middle of November and that means, in Steph's financial terms, that it's time to prepare for the new year!  Basically, this year is kaput.  We've already made enough bad decisions to follow us into the new year.  Now it's time to figure out how to deal with that.

I often look back on the time we were saving to pay of our debts and buy our house and think, "how the HELL did we manage that?!"  Because at this point I really do not know.  I can blame the fact that I no longer bring in an income, but really my income was so small that I don't think that's the real reason.  I think we just set our eyes on the prize and made it happen through sheer determination.  Once we attained the house, we haven't truly devoted ourselves to any other goal, and because of this our budget has suffered.

For me the new year will, hopefully, bring a renewed focus to getting our finances in order.  I DO have financial goals, it's just that up until now none have seemed as pressing as buying our house was.  But now that Sallie Mae wants to take all of our money to pay for that business degree I'm squandering, it's time to tighten our belts and get some shit done.

Today I am motivated.  Sucky time to find motivation, really, what with Christmas coming up and all.  And I know of these money-saving ideas for Christmas, but I cannot seem to follow them.  Christmas is my weakness, I LOVE buying gifts, I cannot resist shiny new wrapping paper (even if I have a closet full from last year), and I think I spend more on cookie baking than any rational person should.  I have started shopping early, thinking that would help me find things on sale and kind of spread out the spending so it wouldn't hurt so much, but oftentimes this just makes me nickel and dime myself to death. So we'll see what happens in the next month.  Lord, give me the strength to not max out my credit card between now and then!

Day Two

Day Two of my 25 day financial journey tells me I should track my spending for thirty days.  Well, I am far too impatient for that!  But I DID look at my online checking account statement to see what it had to share.  It has little nickel & dime purchases, mostly for household maintenance.  This made me realize I need to reevaluate my wonderful envelope system.  For anyone who happens upon this but has never read anything else, I believe strongly in the envelope system as suggested by Dave Ramsey.  The basic idea is that you have envelopes for all the different categories you spend money on, you put a predetermined amount of cash in said envelopes, and you only spend what you have in cash.  This makes life much easier because you don't have all these itty bitty charges on either your debit or credit card, which can add up and are easy to lose track of.  I currently have envelopes for Groceries, Pets, Car Maintenance, Gift, Clothes, and Medical expenses.  When I began this system, we didn't own a home, we rented a townhouse.  It wasn't that big, and any issues we had were dealt with by the staff, so having a home maintenance envelope wasn't worth it.  We also weren't actively homeschooling (which has also been a major source of income drainage), so no envelope for that either....  So here's the problem:  I already feel like I should be putting more money into the envelopes I already have, how am I supposed to add MORE envelopes?  AND still be able to pay my bills??

....when I figure that one out, I'll let you know.  Methinks it might be time to revisit Dave's Total Money Makeover book and see what he has to say on the subject.

I also began really scrutinizing our bills and seeing if there is anything we can do away with.  Unfortunately, I didn't find much.  Well, that's sort of a lie.  See, I'm a bit spoiled.  There are certain things that aren't necessities but I just cannot live without.  Like Netflix.  $10 a month and I have all the movies and tv shows I could ask for.  We love it and watch it daily (it's streaming through the Wii now!) and, though that $10 could probably be used elsewhere, I just can't let go.

While meditating over my spending habits, I did however come up with some ideas that would save money in one area:  Groceries.  The biggest is my Coke addiction.  It started with Coke Zero.  Man I love that stuff!  I drank at least two a day.  Then I decided that artificial sweeteners were probably bad for me.  But did I give up my soda altogether?  Hell no!  I switched to the (waaaaaay more expensive) pure cane sugar sweetened stuff.  So not only am I consuming hundreds of empty calories, I'm spending (at least) twice as much money at the same time!  All of the sudden it hit me:  why not give up soda?  Sure, it's a tasty beverage and gives me that much needed afternoon caffeine kick, but maybe I could get that elsewhere?  I already own an iced tea pot, and tea bags cost, what, like five cents each?  I can sweeten it with a little "all natural" sugar, and boom!  Acceptable in its health qualities AND super cheap!  I've just saved myself at least $20 a month!  ....now if only I could find about ten more simple, $20 saving solutions.  THEN we'd be getting somewhere!

Day One

Important Life Goals


Ahh, the listing of life goals.  I can talk a lot about myself, but I always have trouble really looking deep down and figuring out what the hell it is that I want.  Maybe I think too hard.  Here's what comes to mind when I close my eyes and don't try to figure out if it's the "right" goals.

• I want to be a stay at home mom and homeschool my kids.
• I want to have a happy family.
• I want to live comfortably with the money and life we have.
• I want to, in the long term, run my own business (this is something I want in 10 years or so, once my kids are a little older).
• I want to grow my own food.  Maybe not all of it, but I really really want a garden.  And to learn to can.  It's a little life goal, but it counts, right?
• I want to have no debt.  This includes no mortgage, no car payments, no nothing.  I want to own the things I have and be able to send my kids to college debt free.

My Feelings


How does my current financial situation compare to those life goals?  Well, I currently am a stay at home mom and am homeschooling my kids, but I fear I won't be able to keep that up for long.  Right now they are very young and don't require a lot for their schooling.  But the reason I want to homeschool is to give them opportunities and experiences they can't get in public school.  A lot of those things cost money.  My oldest just started karate.  It's so great to see him excited about something.  It gives him good physical activity and he has the chance to meet other kids with a similar interest through this.  This is almost $100 a month.  In the next couple of years my younger child will want to get involved in something similar, probably with a similar price tag.  There are co-op classes, field trips, museum memberships, and other expenses that come along with our lifestyle, and as they get older and become interested in more things, those expenses will only increase.  Right now I barely know how to pay for the one activity, what will I do when they want more?
And as far as staying home, I still am dealing with the issue of trying to pay off my student loans on top of all our other bills with only one paycheck.  I am often tempted to go get a "real" job for a few years just so I can get them paid off.  But if I do that, the kids will have to be put in daycare/school, and it defeats everything I feel so passionately about (not to mention the costs associated with daycare, school, a new wardrobe, a reliable car, and meals might offset any money I make anyway).

Financial Goals


My financial goals aren't that much different from my life goals, I guess.

• I want to pay off my student loan (about $30,000-- yikes)
• I want to pay off my mortgage
• I want to get back to giving 10% of our income to charity
• I want to have enough to give my kids the extracurriculars they want
• I want to pay for my kids' college educations

Obstacles and Action Plan


Ugh.  The dreaded action plan.  $30,000 of private college debt and I still don't know how to properly write an action plan.  Again, too much thinking.  So first, the obstacles:

• Sometimes I use my credit card to buy myself things I don't really need, but I kind of feel like I deserve because I'm working so hard to keep my family happy and healthy and not in the poorhouse.  And then I have to find a way to pay off said credit card, which then takes away from all of those more important financial goals.
• We keep finding more new and exciting ways to spend our money, without actually bringing more money in.
• We rely a lot on cards (mostly the debit card, a little on the credit card) for daily purchases, which seems to make the money disappear faster than it should.

And now for the action plan:  How to deal with these specific obstacles....

• I should probably put my credit card in the freezer or something.  Maybe I can find something to do with my time that doesn't involve going on a Target shopping spree or buying overpriced makeup, but is still fulfilling.  Maybe I could begin volunteering one evening a week or something?  
• We should take a look at where our money is really going and where it should be going and try to get on a better financial plan.  We need to really prioritize our spending and decide what needs to stay and what can go.  

Now, I know that "should" and "maybe" have no place in an action plan.  But I'm having a really hard time coming to terms with the fact that I once again need to put myself in check.  It's just plain embarrassing to admit that I lost control of my budget once again, when I was so sure of myself before.  Oh, how the mighty have fallen.

I'm baaaaaaaack

Well, folks, I took a little hiatus, but I'm back now.  My commitment to my budget sadly ebbs and flows.  Today I had one of those moments that makes you realize how great budgets can be, and how much I really need to control mine.  See, my poor puppy has an ear infection.  He had to go to the vet today to have it looked at and get medicine and all of those expensive things.  Well, I have been dutifully adding money to the "pets" envelope every paycheck and wondering why the hell I was accumulating so much "pet" money when I could actively be using it elsewhere (like, say, on new clothes or some name brand shoes)... and today that question was answered as I handed over half my cash to the receptionist at the vet's office.  It felt so liberating!  Oftentimes in the past, when an emergency comes up it's been necessary to hand over the credit card and figure out how to pay for it later, or deplete the entire (very small) savings account.  Today I was able to walk in, take care of my dog, and walk out, all without having to sweat about where the money was coming from.  I think this was just the boost I needed to get me back in the swing of things.  Because, unfortunately, my budgeting skills have kind of dulled in the past few months.

It wasn't so long ago that I balanced my budget in beautiful ways.  We tithed our ten percent and still had enough money for all of our expenses.  I lived and breathed my cash envelope system.  But lately, I haven't been so good.  I might sometimes put meals out on the debit card instead of using the "grocery" cash.  Sometimes maybe I put my "wants" above my "needs" and use my credit card to fund things I shouldn't.  Which then leads to using my "pay down the student loan" money to pay off the damn credit card-- AGAIN.  Life happens, and expenses just keep coming.  I feel like we are back in a place of living paycheck to paycheck, and that's not a really fun place to be.  SO, I have officially set aside my latest Gossip Girl novel in order to read a "get your shit together and pay your bills in 25 days" book, and my goal is to share every one of those 25 with you.  Here's the thing:  I might consolidate a little bit if I can.  The book is broken down into these 25 chapters so you can read and accomplish one a day.  I'm not big on only reading one chapter a day, so we'll see if I can actually stick with it.  Sometimes I might do multiple days in one, if it's possible.  As I promised from the beginning, it's going to get personal and probably pretty ugly.  But that's the joy of the internet: as ugly as it gets, I don't really know you so it's all good.  I'll be back later today with my Day One report.  I should warn you (and myself): I have not looked ahead so I have no clue what the daily "assignments" will really consist of.