Well, it's official. We are debt free except for the home mortgage!
We closed on the refinance and everything went well. The out of pocket expenses were less than I had expected ($950) and we won't have a mortgage payment due in May. The first one will be due June 1st. So that is pretty sweet!
And, my husband is expecting a large commission check on May 1st, plus our nice big tax refund should be coming soon. I'm feeling really good!!
So, we were officially in Baby Step 2 for 26 months and we paid off $23,000 during that time.
What's really exciting is that I firmly believe that we have finally figured out how to stop living from paycheck to paycheck. We have finally figured out how to do our budget with an irregular income. It feels so good to know that we are moving in the right direction and things should get better and better.
I have been married for 18 years and during that time we have always struggled with debt. We did not live below our means. Several times we would "pay off" our debts (by adding our debt to a refinance, or when we took out a 401K loan, etc.) but we never changed our ways and eventually got right back into debt. Most years I found that we spent about $10,000 more than we earned - no matter our income.
Things are different now. We forecast our expected income and our expected expenses. We follow a budget. We spend with cash.
Even our mortgage broker complimented us on our finances and said we are doing much better than most people our age that he works with. I know we still have a long way to go, but it did make me feel good. I finally feel like a grown up. I know how to delay gratification. And the more I delay, the more I realize how little I need to feel satisfied. :)
Tuesday, April 28, 2009
Sunday, April 26, 2009
Hello, Hello
So, here's what I have done to earn extra money this week:
Church Nursery: $32
Blog Ads: $200
Jewelry Sales: $127
Babysat Neighbor Child 2 days: $85
Total: $444
I definitely need to start focusing on SAVING money again too though. Best to tackle the finances on the saving and earning sides!
Church Nursery: $32
Blog Ads: $200
Jewelry Sales: $127
Babysat Neighbor Child 2 days: $85
Total: $444
I definitely need to start focusing on SAVING money again too though. Best to tackle the finances on the saving and earning sides!
Tuesday, April 21, 2009
The Cost of Tonight's Dinner
I have been craving going out to eat, but for the benefit of our budget I have been trying hard not to. So, I decided to calculate how much my home cooked dinner cost.
Here goes. We had Chicken Marsala with rice and mixed vegetables for 5 people.
Boneless Chicken: $3.33 (1/3 of a $10 family pack)
Marsala Wine: $1.00 (1/4 of $4 bottle)
Flour: $ .10
Butter: $ .25
Mixed Veggies: $ .75 (3/4 of $ .99 bag)
Rice (store brand Rice A Roni): $ .59
TOTAL: $6.02
So, the total for dinner at home for 5 people was $6.02. If we had gone to our family's favorite local restaurant, the bill for the 5 of us would have been about $46.00!
Here goes. We had Chicken Marsala with rice and mixed vegetables for 5 people.
Boneless Chicken: $3.33 (1/3 of a $10 family pack)
Marsala Wine: $1.00 (1/4 of $4 bottle)
Flour: $ .10
Butter: $ .25
Mixed Veggies: $ .75 (3/4 of $ .99 bag)
Rice (store brand Rice A Roni): $ .59
TOTAL: $6.02
So, the total for dinner at home for 5 people was $6.02. If we had gone to our family's favorite local restaurant, the bill for the 5 of us would have been about $46.00!
Grade Your Finances
Check out this cool calculator at CNN Money. Answer some questions and get a grade on your finances. (I got a C+, but this should improve drastically over the next few months.)
Thursday, April 16, 2009
Moving On To BS3
Well, we are still plugging along.
We have been approved for our refinance, we're just waiting to get our closing date. Our new mortgage will be a 15 year mortgage for $240,000 at 4.5%. This will cover (pay off) our Home Equity Loan and get us "debt free except for the house". Yay!
We will then move on to Baby Step 3 - save 3 to 6 months of living expenses as our Fully Funded Emergency Fund.
Here is what I come up with as our bare bones monthly living expenses:
Auto Gas: $200.00
Auto Insurance: $120.00
Grocery: $400.00
Home-Cable/Phone/Internet: $150.00
Home-Electric: $180.00
Home-Mortgage: $2,250.00
Home-Oil: $350.00
Home-Trash: $22.00
Personal-Braces: $100.00
TOTAL: $3,772.00
If I round up to $3,800 and plan to save enough to cover 6 months, that would be $22,800.00. I didn't include COBRA insurance payments (and I really don't know how much that would be) but I also didn't count on receiving "unemployment" money (which I also really don't know how much it would be or how long we would receive it for) - so I'm hoping those 2 will cover each other and cancel each other out?? (Anyone know more about these things?)
You might also notice that I left our cable/phone/internet rather high at $150 a month, but I figured we'd need the internet for me to continue my on-line business and for my husband to job hunt, and I figured we would want the cable as our only entertainment. (I fear that if we were to cancel it we might snap and go back into debt.)
Miraculously, we are expecting a large tax refund (even though we changed our withholding last year, guess we need to change again), and a large commission check in May and July - soooooo, we could actually have our FFEF by this July!!! This is amazing to me!!
This would mean that in just a few short months we could actually move on to Baby Steps 4 and 5 - and not a minute too soon as my oldest daughter is 12 and we need to really focus on college savings.
So, I'm feeling pretty optimistic tonight.
How did you all figure how much to save for your Emergency Fund?
We have been approved for our refinance, we're just waiting to get our closing date. Our new mortgage will be a 15 year mortgage for $240,000 at 4.5%. This will cover (pay off) our Home Equity Loan and get us "debt free except for the house". Yay!
We will then move on to Baby Step 3 - save 3 to 6 months of living expenses as our Fully Funded Emergency Fund.
Here is what I come up with as our bare bones monthly living expenses:
Auto Gas: $200.00
Auto Insurance: $120.00
Grocery: $400.00
Home-Cable/Phone/Internet: $150.00
Home-Electric: $180.00
Home-Mortgage: $2,250.00
Home-Oil: $350.00
Home-Trash: $22.00
Personal-Braces: $100.00
TOTAL: $3,772.00
If I round up to $3,800 and plan to save enough to cover 6 months, that would be $22,800.00. I didn't include COBRA insurance payments (and I really don't know how much that would be) but I also didn't count on receiving "unemployment" money (which I also really don't know how much it would be or how long we would receive it for) - so I'm hoping those 2 will cover each other and cancel each other out?? (Anyone know more about these things?)
You might also notice that I left our cable/phone/internet rather high at $150 a month, but I figured we'd need the internet for me to continue my on-line business and for my husband to job hunt, and I figured we would want the cable as our only entertainment. (I fear that if we were to cancel it we might snap and go back into debt.)
Miraculously, we are expecting a large tax refund (even though we changed our withholding last year, guess we need to change again), and a large commission check in May and July - soooooo, we could actually have our FFEF by this July!!! This is amazing to me!!
This would mean that in just a few short months we could actually move on to Baby Steps 4 and 5 - and not a minute too soon as my oldest daughter is 12 and we need to really focus on college savings.
So, I'm feeling pretty optimistic tonight.
How did you all figure how much to save for your Emergency Fund?
Tuesday, April 14, 2009
Hi
We're back from my sister's wedding in Florida. We had a great time, but there was one major unfortunate incident. I lost $1,000 cash.
Well, not exactly lost. The day of the wedding we had a lot of setting up to do. My husband dropped me off to help my Mom set up for the wedding and I had the cash in my purse. I never thought to give it to my husband at that time. Then I didn't quite know what to do with my purse. We were setting up at the poolside clubhouse of their development. It is a public place so I was afraid to leave my purse around with all that cash while I was busy putting centerpieces on tables, etc. So, I put my wallet full of cash in my front pocket of my pants. I spent the day setting up and then we drove back to our hotel. Well, my wallet must have somehow fallen out of my pocket as I walked into the hotel. A half hour later the front desk called to say someone found my wallet. We retrieved the wallet that was empty of all cash, and just like that we were out $1,000!
This was only a half hour before the wedding started and I couldn't stop sobbing. My husband was mad at me, but not more than I was at myself. I pulled myself together and got through the wedding but couldn't sleep those first few nights. I'm trying to get over it but I still have a knot in my stomach.
I might rethink using cash from now on. Or at least carry around less at any given time. (I usually do withdraw about $1,000 cash at the beginning of each months fro the envelopes for groceries, gas, gifts, clothes, etc.). Maybe just carry around one week's worth at a time.
Well, not exactly lost. The day of the wedding we had a lot of setting up to do. My husband dropped me off to help my Mom set up for the wedding and I had the cash in my purse. I never thought to give it to my husband at that time. Then I didn't quite know what to do with my purse. We were setting up at the poolside clubhouse of their development. It is a public place so I was afraid to leave my purse around with all that cash while I was busy putting centerpieces on tables, etc. So, I put my wallet full of cash in my front pocket of my pants. I spent the day setting up and then we drove back to our hotel. Well, my wallet must have somehow fallen out of my pocket as I walked into the hotel. A half hour later the front desk called to say someone found my wallet. We retrieved the wallet that was empty of all cash, and just like that we were out $1,000!
This was only a half hour before the wedding started and I couldn't stop sobbing. My husband was mad at me, but not more than I was at myself. I pulled myself together and got through the wedding but couldn't sleep those first few nights. I'm trying to get over it but I still have a knot in my stomach.
I might rethink using cash from now on. Or at least carry around less at any given time. (I usually do withdraw about $1,000 cash at the beginning of each months fro the envelopes for groceries, gas, gifts, clothes, etc.). Maybe just carry around one week's worth at a time.
Sunday, March 22, 2009
Update
It's been a difficult month. We have been getting ready for my sister's wedding. I definitely did not budget enough for this. We will be flying to Florida for the wedding and all 3 of my daughters are in the wedding. Dresses, shoes, sashes, hairbows, etc. It all adds up. Not to mention the need for new sneakers, bathing suits, sandals, etc. That stuff we would have needed anyway for the summer, but I didn't really plan for enough money to get it all now.
I am also fighting my usual impulses to get a whole new wardrobe for the trip. Yes, I needed a new dress for the wedding and probably for the rehearsal dinner, but I am trying to restrain myself from more than that. I have the urge for a haircut, manicure, pedicure, and spray tan.
And as the wedding gets closer (less than 2 weeks away now!), everything seems more pressing. Being frugal requires careful planning. Rushing does not lend itself to getting good deals.
Anyway, I am really looking forward to the trip and trying not to let the high expenses take away from it.
On other news, I did well at a craft show last week. I made $320 in sales. So that was good.
Also, looks like the refinance might be back on. I'm happy about this but also feel a little stress about spending on the closing costs, appraisal, and all the other charges that come up for a refi. We only have about $5,000 in savings right now, and the costs will probably take a very big bite out of this. Next month will (should) be a high commission month that will most likely beef up the savings, but still.
I have to keep reminding myself of the big up side of refinancing - it will make us "debt free except for the house"! This is because we will need to include the Home Equity Loan in the refinance, thus paying it off, and basically rolling it into our new mortgage. The new mortgage will also be slightly less expensive each month (like $50-$100). So, at that point we can move on to Baby Step 3 and finish building up our Fully Funded Emergency Fund of 6 months of living expenses, which for us will be $30,000.
I'll keep you posted. (And try to post more regularly!)
I am also fighting my usual impulses to get a whole new wardrobe for the trip. Yes, I needed a new dress for the wedding and probably for the rehearsal dinner, but I am trying to restrain myself from more than that. I have the urge for a haircut, manicure, pedicure, and spray tan.
And as the wedding gets closer (less than 2 weeks away now!), everything seems more pressing. Being frugal requires careful planning. Rushing does not lend itself to getting good deals.
Anyway, I am really looking forward to the trip and trying not to let the high expenses take away from it.
On other news, I did well at a craft show last week. I made $320 in sales. So that was good.
Also, looks like the refinance might be back on. I'm happy about this but also feel a little stress about spending on the closing costs, appraisal, and all the other charges that come up for a refi. We only have about $5,000 in savings right now, and the costs will probably take a very big bite out of this. Next month will (should) be a high commission month that will most likely beef up the savings, but still.
I have to keep reminding myself of the big up side of refinancing - it will make us "debt free except for the house"! This is because we will need to include the Home Equity Loan in the refinance, thus paying it off, and basically rolling it into our new mortgage. The new mortgage will also be slightly less expensive each month (like $50-$100). So, at that point we can move on to Baby Step 3 and finish building up our Fully Funded Emergency Fund of 6 months of living expenses, which for us will be $30,000.
I'll keep you posted. (And try to post more regularly!)
Wednesday, February 25, 2009
March 2009 Budget
For March, our projected income is $6,590. This includes $600 that will be transferred from our Savings account. It also includes $150 from jewelry sales, which is $100 more than the usual $50 that I budget. This is because I will be doing a big craft show and anticipate making some extra cash. It also includes a commission in the amount of $1,300.
Our projected expenses is $6,527. This includes all our regular expenses including $200 towards our last debt (HELOC) and $1,000 to our "Snowball Savings Account". (We are putting this money aside because of worry about the economic situation in our country. If the storm passes, we will eventually put all this money on our last debt.)
This month's expenses also includes an additional $125 for a charity fundraiser we will be attending to benefit autism (listed under Misc.). It also includes $100 for new clothing for the children for spring clothes and shoes. (This might be a bit low, but I do have another $300 budgeted for summer clothes in June.) It also includes $300 for my daughter's braces because I had forgot my checkbook in Jan. and we missed our appointment in Feb. It also includes $50 for my cell phone as I will need to add some more minutes. (I use a prepaid phone only for important calls.) It also includes $256 for life insurance (which we pay annually instead of monthly).
Our projected savings by the end of March is $5,900. Of this, $4,400 will be in our Snowball Savings Account and $1,500 will be in our Regular Savings Account (and the $1,500 is including the $1,000 BEF).
Our projected expenses is $6,527. This includes all our regular expenses including $200 towards our last debt (HELOC) and $1,000 to our "Snowball Savings Account". (We are putting this money aside because of worry about the economic situation in our country. If the storm passes, we will eventually put all this money on our last debt.)
This month's expenses also includes an additional $125 for a charity fundraiser we will be attending to benefit autism (listed under Misc.). It also includes $100 for new clothing for the children for spring clothes and shoes. (This might be a bit low, but I do have another $300 budgeted for summer clothes in June.) It also includes $300 for my daughter's braces because I had forgot my checkbook in Jan. and we missed our appointment in Feb. It also includes $50 for my cell phone as I will need to add some more minutes. (I use a prepaid phone only for important calls.) It also includes $256 for life insurance (which we pay annually instead of monthly).
Our projected savings by the end of March is $5,900. Of this, $4,400 will be in our Snowball Savings Account and $1,500 will be in our Regular Savings Account (and the $1,500 is including the $1,000 BEF).
Expenses | |
| AUTO-Excise Tax | $0 |
| AUTO GAS - BR | $200 |
| AUTO-Insurance | $120 |
| AUTO-Maintenance | $0 |
| CASH-Auto Gas JR | $100 |
| CASH-Clothing | $100 |
| CASH-Dining Out | $120 |
| CASH-Gifts | $0 |
| CASH-Grocery | $500 |
| CASH-Kids Allownce | $50 |
| CASH-Parties | $0 |
| CASH-School Lunch | $45 |
| CASH-Spending | $200 |
| DEBT-Equity Loan | $200 |
| DEBT-Visa | $0 |
| HOME-Cable/Phone | $181 |
| HOME-Electric | $180 |
| HOME-Water | $0 |
| HOME-Furnace | $0 |
| HOME-Mortgage | $2,327 |
| HOME-Oil | $400 |
| HOME-Trash | $65 |
| KIDS-Bball | $0 |
| KIDS-Misc. | $0 |
| KIDS-Piano | $0 |
| KIDS-Preschool | $0 |
| MISC. | $125 |
| MISC. | $0 |
| PERSONAL-Cell Ph | $50 |
| PERSNAL-Contacts | $0 |
| PERSONAL-Lif Ins. | $256 |
| PERSONAL | $8 |
| PERSONAL-Rx | $0 |
| PERSONAL-Braces | $300 |
| PERSONAL- Sprts | $0 |
| PERSONAL-Vaca | $0 |
| TO SAV E.D. Snowb | $1,000 |
| TO SAV ING | $0 |
| TOTAL | $6,527 |
| INCOME | March |
| 1st Paycheck | $2,220 |
| 1st Commission | $1,300 |
| 15th Paycheck | $2,220 |
| Church Pay | $100 |
| Jewelry Pay | $150 |
| Other | $0 |
| Transfer fr Savings | $600 |
| TOTAL | $6,590 |
| CASH FLOW | March |
| Beginning Balance | $0 |
| '+ Income | $6,590 |
| Subtotal | $6,590 |
| '- Expenses | $6,527 |
| Subtotal | $63 |
| Save For Next Month | $63 |
| Ending Balance | $0 |
| SAVINGS FLOW | March |
| Beginning Balance | $5,500 |
| +Transfer to ED sav | $1,000 |
| +Trnsfer to ING sav | $0 |
| Subtotal | $6,500 |
| '- Trnsfer fr Savings | -$600 |
| Ending Balance | $5,900 |
| | |
| SAVINGS BALANCES | |
| E.D. Snowball Total | $4,400 |
| Ing Savings Total | $1,500 |
| Total Savings | $5,900 |
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