Tuesday, October 30, 2007

10/30/07 - Daily Progress Report

Haven't posted in almost a week! We had a big family birthday/Halloween party this weekend with an elaborate Haunted House that took a lot of preparation (and a lot of money!). And now I'm sick with a terrible cold.

I can't think of any earnings that I have to report since last week. And I have tons of expenses! I need to tally up all of our actual spending this month and compare it to our October budget. I'm pretty certain we went over.

Also need to put together the budget for November . . .

Hopefully I'll be feeling better tomorrow and I can get it all done!

Wednesday, October 24, 2007

10/24/07 - Daily Progress Report

Today's Earnings: $7.00
Rebate: $7.00

Tuesday, October 23, 2007

Another Credit Card?

We'll, the American Express bonus rewards points worked out so well (I got $250 in store gift cards just for signing up), I decided to also sign up for a CitiBusiness PremierPass Card to get $150 in free gift cards. I got my approval letter in the mail today - Whoo Hoo!

If you are interested in learning about these offers you can check out this post by Five Cent Nickel.

10/23/07 - Daily Progress Report

We'll, the American Express bonus rewards points worked out so well (I got $250 in store gift cards just for signing up), I decided to also sign up for a CitiBusiness PremierPass Card to get $150 in free gift cards. I got my approval letter in the mail today - Whoo Hoo!

If you are interested in learning about these offers you can check out this post by Five Cent Nickel.

Today's Earnings: $150

Citibank Rewards: $150

Monday, October 22, 2007

10/21/07 - Daily Progress Report

Today's Earnings: $63.03
Craig's List: $35.00
Church Nursery: $28.00
Ad Revenue: $ .03

Tuesday, October 16, 2007

10/16/07 - Daily Progress Report

Today's Earnings: $46.51
Ad Revenue: $5.38
Associated Content: $1.13
Returned Items: $40

What My Budget Says About My Values

I read an interesting article on what your budget says about your values at My Money And My Life (from the beginning of the summer), so I decided to examine my own budget in this light.

Here are my budget items in order from the most expensive to the least. Let's see what that says about my values.

1. Home - my home mortgage is our highest expense. Add in all the utilities and this expense is almost triple our next highest expense. I am okay with this being our highest expense. I put great value on my home and my home life. Family is very important to me and our family time is spent together at home.

2. Debts - our monthly debt payments are our next highest expense. While I think this shows how much we currently value becoming debt free, I am not happy about what this says about our past values. I'm afraid we placed too much value on things and instant gratification in the past. We are on our way to fixing this.

3. Activities/Gifts/Entertainment/Dining Out/Blow Money - While this may seem like a rather catch all category, I could summarize it as "Fun". And while I think we probably need to lowers this category in order to increase "Prepare For The Future" (college, retirement, fully funded emergency fund, etc.), I am okay with this category being somewhere near the top. Enjoying your life is kind of the point of everything, isn't it? (Once the debts are paid off, that money will go mostly to the future anyway.)

4. Food & Car Expenses are about tied in 4th place. I value food waaaay more than cars, but some food expenses are included above in the Fun category, so I guess I am spending more on food than on cars - phew!

Well, it seems that our budget is fairly well aligned with our values. The glaring problems with the current state of things is even having a need for the Debts category - and the lack of a category for Planning For The Future. These will both be resolved once we become debt free.

Take a look at your own budget and see how in line it is with your values.

Monday, October 15, 2007

Blog Action Day

Today is "Blog Action Day". A day when bloggers unite to write about saving our environment.

Well, saving the environment and saving money often go hand in hand, so this is clearly a topic appropriate for a personal finance blogger.

Here are a few things my family does that saves us money and is also good for the environment:

- we use compact florescent light bulbs, they last much longer than regular bulbs and therefore save us money by not needing to replace them as often, and they use much less electricity which also saves us money on our electric bill, and using less electricity is obviously good for the environment.

- we only wash clothes and dishes with a full load - this uses less water and electricity, saving on our water and electric bill, and also good for the environment.

- we keep our thermostat set at 68 degrees, and turn down lower at night, and off when we leave the house, this saves us money on our oil bill, and uses less oil which is good for the environment

- we keep the air pressure appropriate on our vehicle tires, this gives us better gas mileage, saving money on gas and using less which is good for the environment

Those are just a few that I could think of off of the top of my head. I'm sure there are more that we do, and certainly there are many many more that could and should be done.

I just wanted to do my part to participate in Blog Action Day. A great effort for a great cause!

10/15/07 - Daily Progress Report

Today's Earnings: $28
Church Nursery (actually from yesterday): $28

Dave Ramsey Premieres on Fox Business Channel Tonight

Tune in to see Dave Ramsey on prime time television with his new show on the Fox Business Channel tonight. For more information and to see if that channel is available in your area, click here.

(Unfortunately, that channel isn't available in my area!) :(

My Best And Worst Financial Decisions

After reading several posts from the M-Network Group about their best and worst financial decisions, I decided to think about and post my own.

I'll start with my family's worst financial decisions because it should be easier for me to think of these!

Our Worst Financial Decisions

Buying An Expensive SUV - This was one of our worst financial decisions. My husband had been with a company that provided him with a company car for twelve years. Every two years he got a newer model SUV and it was paid for by his company. When he decided to change jobs, we knew we would need to purchase another car. We agreed to buy a used car. My husband wanted to get something modest like a Nissan Altima. I pushed for him to get an SUV. His new job was not a downgrade and I didn't want him to downgrade in vehicle. Looking back now, I think I was worried about what other's would think. I didn't want anyone to get the impression that we weren't doing well. (Talk about trying to keep up with the Joneses!)

Paying For The SUV With A HELOQ - To make the decision to buy an expensive SUV even worse, we decided to take out a Home Equity Loan to pay for it. My husband gets the credit for this bad decision. I was uncomfortable using our home as collateral for a loan to pay for our car. My husband insisted this was a good decision because the interest rate on the HELOQ was lower than the interest rate for a car loan. I gave in - and we are still paying for that HELOQ (even though we got rid of the SUV two years ago!) - and the balance on the HELOQ has actually gone up instead of down! (due to a combination of only paying the minimum and actually adding charges to the loan!). Not only was it a really really bad idea to risk our home as collateral for a car, this was also a terrible plan for us because of our lack of financial discipline. If we had taken out a regular car loan, we would have been forced to pay a large amount each month and have the loan paid off in 4 or 5 years. Instead, by using a HELOQ we were able to only pay a small minimum monthly payment (which is what we did) and we could take up to 20 years to pay it off! (Which it probably would have if we hadn't found Dave Ramsey and begun our journey to Debt Freedom!)

Not Saving Money When We Had A Lot Of Disposable Income - After we got married, my husband and I made a good decision and purchased an inexpensive two family home. We fixed it up, rented out the second floor, and lived very inexpensively on the first floor (our rental income paid for 75% of our very low mortgage). During the first five years of our marriage we didn't have children and we both worked and earned good salaries. During this time we had the opportunity to save a lot of money. Instead we managed to spend everything we made, and then some. We somehow managed to rack up about $10,000 of credit card debt! The saddest part about it is that we really have nothing to show for all this spending. We took a couple of average vacations and bought a little furniture - certainly not enough to account for thousands of dollars of lost disposable income!

Not Being Able To Keep Our First Home As Rental Property - We lived in our inexpensive two family home for a total of nine years. In 2000, with two young children, we decided to purchase a larger single family home. We should have had plenty of money for a down payment on a new home and still be able to keep our two family as rental property, but because of our poor financial management, we needed to use the money from the sale of the two family as the down payment for our new home. It still bothers me today that we could be making some nice rental income each month had we only paid attention to our finances earlier!

Taking Out A 401K Loan - When I was pregnant with our first child, we made the decision that I would quit my job and be a stay-at-home Mom. At that time, we had $10,000 in credit card debt and felt that we needed to pay off this loan in order to be able to afford for me to stay home. So we took out a 401K loan to pay off the credit cards. Looking back I'm not sure why we thought it was better to pay monthly to our 401K loan than to pay monthly to our credit cards. It felt like we paid off our credit cards, but in fact we just transferred our debt from one thing to another. Then, just like I always read about, we went ahead and racked up another $10,000 in credit card debt. On top of this, we lost out on the interest that our 401K investments would have made during the time it took us to pay it back. If you're thinking about a 401K loan - reconsider now!!

Well, I'm sure we have made other financial mistakes but those are the ones that come to mind first.

Now to think of some of our best financial decisions . . .

Our Best Financial Decisions

Buying An Inexpensive Two Family Home - I know I mentioned above how we could have done better with this decision, but this was a good financial decision. Instead of paying rent, we were paying into the equity of a home. This was good. Also, we avoided the mistake of buying an expensive home (like a lot of our friends did) that required two incomes to pay for it. We were smart enough to purchase something that we could afford on one salary so that when the time came I was able to quit my job to be a stay-at-home Mom.

Contributing To Our 401K Consistently & Early On - Again, I know I mentioned above that we made the mistake of borrowing from our 401K, but we could have done worse. As soon as we were able, we contributed the maximum into our 401K's, and continued to contribute consistently. (Until this year when we temporarily stopped contributions so as to pay off all our debts as soon as possible.)

Realizing That Small Amounts Of $ Can Make A Big Difference - In the past I didn't think that small amounts of money could hurt us or help us. I avoided trying to earn extra money because I didn't think it would make any real difference in our finances. I also didn't view small expenses as anything to worry about. I now realize that small amounts of money can make a big difference in our finances. Every small purchase I avoid helps our bottom line. And every small amount I earn also helps our bottom line. This realization has greatly improved our finances, and will continue to improve our finances for our lifetime! I now think about (and budget for) every small purchase, and I no longer see it as a waste of time earning small amounts (for example, working at the Church earns me $28 each week. In the past I would have found this too small to make a difference. I now see it as more than paying for my daughter's weekly piano lesson!).

That's all I can think of for now. I'd love to hear about other's best and worst financial decisions either in comments or in your own blog! :)

Friday, October 12, 2007

The Big Raise Pays Off!

Well, several weeks ago I posted about my husband's great promotion and raise. Well, we just found out that he's getting a $22,000 bump in his base pay! This is sooo great! The major portion of his salary is still commission, but now we can count on an extra $1,000 in his monthly take home pay! (Now there is the chance that the commissions could plummet and we'll end up taking home less than before, but that is unlikely.)

So, I have already done a revised Debt Snowball where we throw $2,100 per month at the debts (instead of the current $1,100) and if we really can keep up with that kind of a snowball - we'll be debt free in March 2009!! (This is sooo much better than the original debt payoff date of August 2010!)

Obviously, I am happy about the possibility of us getting out of debt sooner rather than later. But there are two specific reasons that this is making me sooo happy!

The first is our car situation. In the near future, we are going to need to replace our minivan. It is very old and is starting to have problems. I am willing to drive it as long as possible (eventhough it has a big rust spot on the front of the hood of the car!), but chances are we will need to replace it sometime over the next 3 years. This has always been in the back of my mind, nagging at me, because if we took 3 years to pay off all of our debts, how could we possibly save up to buy another car? (This is a point my husband would point out to me every time I mentioned how well we have been doing paying off our debts!)

Now, if we can become debt free in 17 months, that should give us enough time to save up and pay cash for our next car. And now that we'll have $2,100 instead of $1,100 each month, we'll be able to save up enough that much faster!

The second reason that I am very happy is - at the beginning of the summer, I spent some time plotting out the probable dates of some future large expenses. (I didn't even put new cars into these equations.) I plotted out start of college for Daughter #1, Daughter #2, and Daughter #3, as well as possible wedding dates (age 28?) for each of my 3 Daughters. Then the possible retirement date for my husband (age 64?). Next to each expense, I put an estimate of the amount of money that would be needed.

I also put the date when we would possibly have the mortgage paid off, and added the monthly mortgage payment towards our available income. I assumed that our money was invested with a return of 8% (actually 12% adjusted for 4% inflation).

I tried and tried but couldn't get close to having the appropriate amounts by the appropriate dates. Even when I assumed that we started saving $1,500 per month immediately (which was quite a stretch given that we only had $1,100 and it was earmarked for debts for 3 more years, and the fact that this didn't take into consideration the need for car replacement, home repairs, or other sinking fund type expenses) - and even with these stretches we still came up a little short for each of the expenses.

I haven't redone all of the math, but I think we are a lot closer to being able to achieve our goals with $2,100 a month!

I really can't wait to tell my husband "I told you so" when we pay cash for our next car! :)

Thursday, October 11, 2007

10/11/07 - Daily Progress Report

Well, including today's earnings I am up to $196.16 so far this month. Appears I am on target to earn around $600 this month - not the $1,000 I am aiming for. But there's still time. My performance in getting things on ebay and writing for Associated Content has been lacking. If I get my act together, I could still manage to make $1,000 but it will be tough.

I did apply for another credit card (I know, I know, totally against the Dave Ramsey way!) - but I can't resist those free bonus points! This card from citibank will get me $150 in free gift cards, which I will use towards gifts, both Christmas and upcoming birthdays. This money added to the $250 in gift cards I got from American Express will put a huge dent in my gift expenses. And I will put the funds I would have spent on these gifts towards the debt snowball! So, if I get approved for this new card I will add $150 to this month's earnings.

Today's Earnings: $103.06
Ad Revenue: $100.11
Associated Content Performance Bonus: $3.06

Tuesday, October 9, 2007

Credit Cards Tempting Offers - Update

A couple of month's ago Five Cent Nickel posted about some Great Credit Card Offers. I was reluctant and skeptical to apply for a card to take advantage of the bonus rewards points being offered. But after some thought and several phone calls to verify the details of the offer, I went ahead and applied for an American Express Card (business card, but anyone can get it as a "sole proprietor"). The $40 membership is waived for the first year (and I plan to cancel before the next), and I was supposed to receive 25,000 membership rewards after making my first purchase (of any amount, even $1). These membership rewards can be cashed in for a free airline ticket or for gift cards.

Well . . . I am very happy to report that I just received my free $250 in gift cards in the mail!!!
Yup! $250 in free gift cards!! There are lots of stores to choose from. I decided to get $150 for The Gap, $50 for Bath & Body Works, and $50 for Crate & Barrell. I plan to use these to buy Christmas gifts for my family.

So, if you're interested, it's not too late to sign up!

I'm even considering applying for another!

10/09/07 - Daily Progress Report

Deposited a couple of checks today that came to almost $50.00 (one from Mystery Shopping and one from Cash Crate). Also transferred $50.00 from Paypal into our checking account (from ebay sales and Associated Content payments). So, I paid an extra $100 to Chase Visa - which is the debt currently under attack by the Debt Snowball. So, paid $1,000 on this debt instead of $900 as budgeted. Very happy about this. I plan to throw every extra cent at this debt and have it gone asap! Then we'll be down to just the HELOQ! Can't wait to be debt free!

Today's Earnings: $0

Monday, October 8, 2007

10/08/07 - Daily Progress Report

Well, I have been missing the past several days. Haven't even had a chance to get on line. I'll try to catch up over the next few days.

Today's Earnings:$45.06
Ad Revenue: $ .06
Mystery Shop: $ 10.00
Jewelry Sale: $ 10.00
Returned Items: $25.00

Tuesday, October 2, 2007

10/02/07 - Daily Progress Report

Today's Earnings: $ 20.04
Ad Revenue: $ .03
Savings Interest: $20.01

Monday, October 1, 2007

October 2007 Budget

Budgeted Income: $7,208
Budgeted Expenses: $6,945
Save for Future Monthly Expenses: $263

* * * * * * * * * * * * * * * * * * * * * * * * * * * *

Budgeted Income: $7,208
Funds Saved from Last Month: $61
Husband's 1st check: $1,593
Husband's 1st commission: $3,754
Husband's 15th check: $1,700
My church check: $100

Budgeted Expenses: $6,945
Home - Mortgage: $2,355
Home - Electric: $190
Home - Oil: $273
Home - Cable, Phone, Internet: $167
Home - Trash: $65 (paid quarterly)
Debt - Chase Visa: $907
Debt - HELOQ: $193
Auto - Gas: $350
Auto - Insurance: $138
Nursery School: $175
Piano: $264 (13 weeks of classes, not paid last month)
Prescriptions: $20
Gifts: $200 (take parents to dinner for babysitting our kids for a week when we went to the Bahamas, and take husband's coworker to dinner for helping him get promotion, gift for neighbor for helping us move a refrigerator, dryer, and china cabinet.)
Misc.: $100
Activity Fees: $420 (budgeted for last month but check's have not yet cleared - $85 each for 2 daughters for basketball fee, plus $225 fee for the travel team, $25 membership for for me for the local MOMS Club where I get free advertising for my jewelry.)
School Photos & Fees: $118 ($24 x 2 for school photos, $35 x 2 for "activity fee" for school)
Husband's New Cell Phone for Work: $200 (his job will now pay the monthly phone charges and we'll get a $150 rebate on the phone)

Grocery: $225
Dining Out: $100 (dinner for best friend's 40th birthday, other)
Pizza: $80
Spending: $220
Parties: $100 (2 daughter's birthday parties)
Gifts: $30 (birthday)
School Lunch: $36
Misc.: $10

Save For Future Expenses: $263

Monthly Progress Report - September 2007

Well, September is over. I spent the evening going over our financial records to find out how we did sticking to the budget this month.

The first thing I have to report is that I found a great way to calculate the money we spent. (Most of you probably already know about this!) We have been paying our bills on line for a while now and I check our account almost daily to check our expenses, etc. While I knew that we could export our bank info to software such as Quicken (and I tried this for a brief time a very long time ago, but found it too tedious to hand enter the other entries into Quicken) - what I did not realize is that I could export the bank date to Excel!!!! This was quite a revelation for me and made it sooooo much easier to track our expenses. I simply exported the data to Excel, quickly categorized each transaction and then sorted the data by category (which is also something I learned to do for the first time this evening!).

These great realizations are going to help us quite a bit in finding out how our actual spending compares to our budget!

So, what were our results for September?

Well, at first I was disappointed to find out that we went over budget by $400.76. Then I started to think about how that didn't make sense since we came in under budget in virtually every category. Then it hit me. Our debt payments. We budgeted $1,100.00 for debt payments but actually paid $1,668.84 toward our debts! So, this was a good thing! We went over budget in debt payments!!

I decided to make the extra payments on one of our credit cards because we had some extra income (some money from my previous earnings just rolling in now!) , so we decided to pay off our lowest credit card in full! So, we are down to just 2 debts left (not counting the home mortgage). We have 1 credit card left and our HELOQ.

It feels so good to be down to only 2 debts. Although we still have a hefty balance on those debts, it is so much easier to focus our attention on 2 than on 5!

The budget news wasn't all good though. The other category where we went over budget was grocery. This is especially not good since I allotted a hefty $480 for the month, and we ended up going over by $265.20!! So, I definitely need to pay more attention to this category! (and I used to pride myself on my frugal grocery shopping. Need more focus here!)

But, all in all I am very happy with our progress this month. Not counting the extra money we spent on debts, we came in $170.00 under budget. So pretty good.

Earnings this month were not really so good at only $600.00. That's $400 under my goal of $1,000, but I think we are moving in the right direction.

Haven't finished the October budget yet, but will try to get that posted tomorrow.