another one bites the dust

We don't buy on credit unless it's zero interest for many months. We used a Best Buy card to get our awesome camera, an even more awesome lens and then reluctantly, a new oven for the condo. There is nothing worse than buying a new appliance you don't actually get to use.

On second thought, it was more awful to pay for a cleaning lady that cleaned a space I do not get to live in.

But to the news of the day! We paid off our Best Buy account. Which is less awesome than the second mortgage, but still awesome.

more budget

I've gotten a couple questions regarding our budgeting process since we've paid of some major debt. Here's what has worked for us.

1. Write it down.
We are not perfect with tracking this but we have our budget spelled out to the dollar using this document. Ideally I would be then adding everything to the sheet instead of keeping vague running totals in my head. Knowing the parameters though of what we have left after fixed payments works of us. I am not so strict though that I go through my Target receipts to separate out personal supplies and groceries.

2. Get friendly with the bank.
Twice a month money is automatically taken out of our checking account (where paychecks are deposited) and   distributed to our other three accounts. The most goes into our money market account which we use as our future house down payment savings and grad school tuition payments. We never pull money out of this account.

Next is our emergency fund. We use this for things like car repairs, medical expenses or other unexpected bills. It makes it easier to pay them knowing "that's what the emergency fund is for."

Last is our travel fund. If we had all our money together, we'd never spend it on travel because it'd take away from our house down payment or set us back in other savings. But travel is something we've determined is a priority for our family so we have our fund. It gets about $200/month which really does add up fast. Knowing it's designated for travel makes it easier to use. Dave Ramsey would tell me I shouldn't travel while we still have student loan debt. I would tell him to zip it.

3. Be ready to sacrifice.
Initially budgeting was hard. It was all this money we were putting off limits. But now that we've been doing it almost three years, I forget we even have that money. Because we made the sacrifice initially, it was easier to just take the money we used to pay off our second mortgage and put it toward the highest interest student loan. We didn't allow ourselves to experience a month with a couple thousand extra dollars.

We still go out to eat, but we budgeted for that. I still can buy a new dress, but it's budgeted. We no longer spend in excess on clothes we don't need or updates on our stuff that really could wait. We don't have extra luxuries like cable or gym memberships but I can honestly say our marriage has benefited.

4. Snowball effect
It works. You pay off one bill, transfer that money to another bill and so on. Because we are comfortable with the level we're living at, as we have made more money it goes toward debt. It also allowed us to start a college fund for Henry and set up two life insurance funds as soon as we became parents without any real extra sacrifice in our monthly budget.

5. Attitude
Sometimes I get really jealous when other people are buying huge houses at our age, buying new cars or going to concerts every weekend. (that's a lie, I hate concerts) But, if Dave Ramsey taught me anything it's "Live like no one else so later you can live like no one else." There will be a day in the not too distant future, where we will be living debt free. But we'll know how to live within our means and maintain a budget no matter what our bottom line.

the big one

We've had some strict financial goals the last two years. Ones that at times have made me cry. Other times made me happy for how far we've come.

Shea bought a condo before we were married, which was a great decision when the market was awesome, and he thought he'd live there for a long time. Then he got married, the market tanked, we moved to Kansas City and had the choice between selling and losing $40,000 or becoming landlords. We chose the latter.

If you want to be bored with the details: The mortgage is 80/20 with the 20 percent borrowed from a private group and the 80 percent from a major  bank. For the last two years, we've been paying more than five to seven times the minimum on the 20 percent loan. It's a significant chunk of change each month (actually, it's almost my entire paycheck. I find this moderately demoralizing.), and the rent we charge covers the 80 percent part of the loan plus condo association fees only.

So we sacrificed. A lot.

But today...

...we made the last payment.

Yay, budgeting!

consignment savings

Last week we twice visited the Kid's Closet consignment sale. It takes over an old Marshall's store and more than 600 families sell their items. Last year we learned our lesson about the long lines and I volunteered for a four-hour shift so we could shop first.

For just over $100, we got a wooden Jenny Lind highchair, cute summer overalls and sun suits, a few cloth diapers, books, blocks and this rocking horse that Daddy couldn't resist.

We went back on half-price day and got the rest of Henry's summer clothes and some fall items for less than $50. More than 20 outfits (including brands like Ralph Lauren, Gymboree etc) for the same price I paid for a two shorts and a shirt brand new. Clothes with any stains or extensive wear are not allowed to be sold so we know we're getting quality items.

The ABC blocks with little figures inside for each letter are my favorite. Henry, however, would have preferred I would have attended a Tupperware party.

a budget finish line

I frequently have thought our budget goals were much like my half marathon training. Slow and steady rewards, occasional vomit-inducing long runs and absolute joy when crossing the finish line. When it came to budgeting, my initial reaction was a dramatic fit of tears (you want me to do what?!). Then we created a viable plan that wouldn't make us crazy but still kept us on track. And then we suffered the challenge of sticking to it.

Tomorrow we'll reach a milestone, which calls for a celebratory update.

- We've paid off almost $10,000 on our second mortgage by paying five times the monthly minimum payment.

- We took a babymoon trip to Belize using only funds from our travel savings account and not dipping into other accounts. And we have money left over to start saving for the many "meet the baby" trips to come this fall and spring.

- We still managed to put a significant amount in our three savings accounts (travel, money market, emergency) each month. We had a detailed budget plan to stick to until we reached the milestone a pretty lofty goal for the balance in our main savings account. And tomorrow we will hit that amount thanks to some hard work by the hubs and a lot of budget dedication.

At the end of the month we're moving into a rental house that is $65 more in rent per month plus a bit higher utility bills ($27 is hard to beat). Plus we have to budget for daycare, continued graduate school tuition bills, a high-efficiency, cloth-diapering friendly washer and dryer and you know, stuff babies need. (Facts I am totally NOT obsessing about...)

So now it's time for a new training plan, this one probably at the marathon level (and a new running goal, too?). We'll have new goals, a new budget and then new rewards. But for now, yay! We done good!

frugality strikes again!

Dave Ramsey has once again foiled my plans.

We got in our heads that we wanted a house. BAD. Our apartment is fabulously large and cheap. Plus we pay one utility - electric - which averages at $40 during the winter. Friends, we have it good.

But the hard parts are the complete lack of storage. The inability to have people over. No where to grill or let Mac the dog run at least without a visit to the dog park. No bedroom door which means no separation between us and our needy animals. So in our frustration and the fact our lease ends next week, we started to look at houses. They were cute and financially possible unless you factor in utilities for a house that has gas heat. Then we found the PERFECT house and the woman was willing to negotiate.

We redid our budget for hours. And hours. We thought about giving up the iPhone, not paying so much extra on our mortgage or not putting ALL that money in savings. I started to get weepy because that's what budgeting, especially Dave Ramsey style, does to me. I hate him and his stupid money theories sometimes. Especially when I am looking at a fenced in yard and fire pit. But he is stuck in my head and no matter how much I try, it's like a nagging little voice that just won't shut up.

We knew we had to say no. In a last ditch effort to not make the hard decision, we offered her a ridiculously low rent with the assumption that in a year we could pay more. She considered it. But then another guy ponied up and is signing her lease.

Sometimes it's easier when God closes a door.

In a year, our second mortgage will be paid off. That's $28,000 paid off in two years plus a much better opportunity to sell the condo in the nearer future. In addition, this strict budget has allowed us to pay off a credit card ($2,000),  pay off a car ($8,500) and create an emergency fund.

So we'll live cheap for 365 more days. And will live so far below our means that our debt will get smaller. We'll be able to stay on track. That'll be good. I just don't always like it.

"You don't get to say "yes" until you've said "no" for  a while."

random thoughts friday

Hello there, Friday. I've been waiting for you and  your sunshine all week.

life updates
We're still running. My goal for Sunday is seven miles, which is probably stupid to post here because I am against public failure. Regardless, if I make it, that's 20 miles this week.

I've made a vow to use my crockpot every Monday. We have a small group we go to and knowing dinner is ready when I get home and I don't have to hurry is super fabulous. Our favorite recipe so far is barbecued pulled chicken. We ate it for five meals with sandwich thins (also a new favorite).

My goals this weekend are to eat as much barbecue as possible, go to church to hear about women of the Bible which is appropriate considering immediately following our church service I am vowing to be genuinely excited for the LOST finale watch party. Shea and I are excited for the finale for different reasons, but look at me being all supportive!

deals
Old Navy is having a $1 flip-flop sale. You should go tomorrow. Luckily my feet are oddly small so I do not have to go at 7 a.m. After getting cheap shoes, go by Wal-Mart for free ice cream.  I'm not going, because even I have limits.

Chick-Fil-A might clog my arteries but I do not turn down free food (except at Wal-Mart). Go here and reserve your free sandwich.

need travel advice

We're thinking of going on a cruise as our second honeymoon - which really is just an excuse but in all fairness Disneyworld is not the most relaxing and delicious honeymoon destination. Especially when the groom gets sick and the bride wants to eat nothing but ice cream and popcorn. But fun if your week goal is to fill two autograph books with character pictures and signatures (mission accomplished). Anyway, we can't decide between Norwegian or Carnival. Both would be Western Caribbean departing from either Miami, Fort Lauderdale or New Orleans. Any opinions out there?

boost my self-esteem and follow me!

If you read my blog regularly, you should actually become a follower - check out the box on the right. Why? Because it makes me feel popular and loved. And there are days when I need that.

Happy weekend!

bye, bye car payment

We met with a financial adviser a week ago and faced the hard reality that we can't really consider buying a house until some major loans are paid off. We knew this, although it was fun to dream. By dream I mean spend hours online look at house listings, drive by the cute ones, plan to go to open houses. Now, Shea is banned from sending me "cool!" links to houses. Because when I get those I start dreaming about things like closet space, and this is a gateway drug to hallways, pantries and yards.

We did get confirmation that we're on the right track. That we're living below our means and saving a lot, which was pretty cool. And then we took our pretty sizable house fund and used it to pay off some loans. First up, the car loan. It was set to be paid of in January 2013. It's May 2010. You do the math. No seriously, it's too early for me to do math. Compound and simple interest is knowledge I left safely in a high school classroom where it belongs. But those handy dandy online calculators, which have eliminated the validity math teacher's claims of "you'll need this someday," tell me that we saved almost $1,000 in interest.

Do you see those big fat zeros? Does it make you want to do a spontaneous happy dance at your desk?

A budget without misery

We've adhered to a pretty strict, yet flexible budget since we moved to Kansas City. It was a chance to start new with big goals and financial commitments. Plus, we didn't have a whole lot of offers for dinners and happy hours meaning we could spend a lot less on entertainment.


Financial goals 2010


1. Find cheap rent without risk of getting shot every weekend.  Less than $600/month and no shootings yet!


2. Pay off all credit cards, and don't use again.  Done. See here.


3. Live below our means without being miserable. 
Continue to work on this everyday, and doing pretty good. We commit to free days as much as possible. We utilize Groupon for entertainment/restaurant discounts often and then bargain with ourselves. Example: We are going to Cirque de Soleil on Thursday with awesome tickets from GrouponKC (want to join? Let me refer you and then I get $10!) for a deep discount but in exchange we've promised to reduce our "eating out" budget for the month.


4. Continue to put significant amount of income toward debt.
Doing well! Exciting news on this goal coming shortly. Stay tuned, my friends.


5. Make budgeting easier.
We did this by creating multiple bank accounts with a bunch of automatic transfers accompanied by the help of mint.com and an Excel spreadsheet.

• We have a checking account for life.
• A money market fund which depending on the phase is a house fund/baby fund/can't find renters for the condo fund/buy a used car with cash fund/graduate school tuition. This fund gets two large automatic transfers from checking each month.
• A savings account for fun/travel and other things we love spending money on. *This account requires a deposit each month and only five withdrawals per year. Then the bank gives us $50.
• A savings account for little emergencies like car repairs, condo repairs and other things we really hate spending money on.

6. Cut out the fat. 

We looked at our financial picture - where our money was going and how that matched up with our values. We cut out the fancy gym ($105/mo) and went for a low-cost one. This allowed us to pay upfront for 15 months and save hundreds in monthly fees. We cut out cable TV ($100/mo) and instead use instant Netflix ($11/mo) and a HD antenna ($17 once). We stopped buying clothes except for special occasions. I don't know how much this saved but it's significant. 

We also budgeted $150/mo for restaurants which includes happy hours, Sonic or Starbucks runs and dinners out. This seemed to be the biggest denial, and now we aim to be very conscious in this area. It gets tough though when we take frequent weekend trips.

7. Follow Dave Ramsey's advice, "If you live like no one else, later you can live like no one else." 

Despite his tendency to make me cry, Ramsey's main principle is one we quote often and not just when it comes to money. We quote it when we see for sale signs in the yards of our dream houses. Or when we're stacking up crates underneath the bed or in the corners because we have no storage. Or when we are tempted to spend $50 to alleviate the annoyance of cooking. Or when we spend less on birthday presents or wedding gifts than we'd like to. Or when friends or family members continually has newer and better cars, houses, clothes or weekend entertainment.

And now living cheap and watching our debt subtract has become like training for a marathon - the daily challenges get easier, the weekend long runs still stink but the feeling when we finally cross the finish line will be fantastic. Plus, I think in both instances I will need a banana.

2010 Census dilemma

A couple of weeks ago, Shea and I took the U.S. Census worker test. That in itself was QUITE the experience.

We were ushered into a cramped room with about 40 other people to fill out forms for the next 30 minutes. Unfortunately, we had already filled out these forms, so instead we sat and eavesdropped on conversations like how a GED is easy to get and traditional universities (this lady's example: "those Yale schools") where students sit in classrooms are far inferior to an online degree.

Then we all walk into another room where we reenact the SAT except with 28 questions in 30 minutes on directions, simple but tricky math and literacy. Surprisingly tricky questions but all in all, simple.

For the past week I've been getting calls. Despite the fact I indicated on my form that I can only work evenings, they keep calling to see if I can attend daytime training.With each call, Shea gets more pouty that they are not calling him. I reassured him it's probably that they need girls.

So tonight I got a call for an evening job with training starting Monday. Though it pays less than the $17/hour door-to-door jobs (knocking on scary people's doors included), the office clerk job pays $11.50/hour, which is a good $250/week. That's $1000/month, which is nothing to shake a stick at.

Pros

• Only 10 blocks from our apartment
• Earn money for vacation fund, house fund, or pay-off-the-car fund
• Temporary, could be very short-term and "variable" work meaning less commitment
• High turnover =  easier to quit if I hate it
• Crazy stories for this blog

Cons

• Consistent evenings/potential Saturdays away from Shea, which I already miss him at my real job
• The above bullet really deserves two lines
• Mind-numbing work with potential crazies
• Not knowing if they are flexible if I can't work one night

Do I go to the training? Is the extra money worth temporary time away from the hubs?

Help me decide, and comment please!

The Day of Free

The Challenge: Find enough free and awesome things to do to fill an entire Saturday. Not only did we succeed but we actually had options to choose from.

 7:55 a.m. Wake up because our bodies are programmed to not sleep in. We're old. Shea abides by Saturday morning routine and makes pancakes while I lie in bed thinking big thoughts.

11 a.m. Finally shower after watching Arrested Development and Darfur Now. Free on instant Netflix.

12 p.m. Free Boulevard Brewery Tour. Very cool, and gave us even more respect for Boulevard Beer. Plus, we got to taste four beers, for free. New favorite was Boss Tom's Bock. We left quite relaxed :)

1:30 p.m. Lee's Summit Kite Festival. Free admission, and a super relaxing way to enjoy the nice weather by laying in the grass and watching the sky. The flyers included both professionals and kids flying kites, music and booths.

5 p.m. Went to Joe's Pizza at Kelly's in Westport. We got a coupon in the mail for a free large pizza to welcome us to the neighborhood. We felt very welcomed. And full.

7:30 p.m. Attended a free concert by the Kansas City Civic Orchestra at the Folly Theater downtown. Major nostalgia for my Gold Orchestra days.

We went from pancakes to beer to Beethoven's Symphony No. 3. Cost of such a diverse, relaxing and fun day? Priceless. Literally.

ZERO credit card debt

Yay! Living cheap pays off. Next up: Mazda car loan. Don't hold your breath.

A Netflix Education

No cable has ironically given us more knowledge of the TV shows all the kids talk about. Except we can’t really talk about it with the cool kids because we are perpetually a year behind. 

Big Bang Theory: Unexpectedly hilarious and a new favorite. The theme song alone is happiness-inducing. 

Curb Your Enthusiasm: Funny in an uncomfortable Larry David way.

Always Sunny in Philadelphia: More like partly cloudy with a huge side of inappropriateness. Sometimes too offensive and other times just really annoying to watch three whole minutes of four people all talking at the exact same time.

30 Rock: LOVE. Potentially better than Gilmore Girls but still undetermined. Unfortunately we finished the three available seasons and now must wait. Tina Fey makes my pajama-wearing, no hair-brushing, spilled-food-on-the-shirt days acceptable.

How I Met Your Mother: More love. This show however has been in a waiting pattern for about six months as we are unable to watch the current season without messing up our order and already finished the DVDs. I NEED to know who the mother is!

LOST: Hated the first five episodes but getting better. Observations:

1.       That island is far too big for it not to be known.

2.       Where is the beauty salon located on the island? These people look more groomed and beautiful than I looked on my wedding day.

3.       Why are they not more injured after crashing in a plane with nothing but a few scratches? You know, except for the dead people.

4.       There seem to be a lot of helpful tools in the checked luggage. Guns? An ax? Medications? Herbal tea? Needles? Bandages? Hunting knives? A hot doctor? Clearly this was a pre-meditated crash.

Jon and Kate Plus 8: I never watched it until unemployment coupled with Instant Netflix forced me to. It has taught me that 1. You can be a really irritating wife but a good mother. 2. Kids, especially eight of them, produce a lot of disgusting bodily functions. 3. Since I know the ending – the lawsuits, the affairs, the ridiculousness, not quite as charming of a show.

Next up: Mad Men, Six Feet Under, Weeds, Chuck and Glee