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It Isn’t All About Income

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Yesterday I read something over at Budgets Are Sexy that really resonated with me.  J. Money read an article from Mr. Money Mustache (a pretty famous blog that I follow).  In this article MMM said:

“The most important thing to note is that cutting your spending rate is much more powerful than increasing your income.  The reason is that every permanent drop in your spending has a double effect:  it increases the amount of money you have left over to save each month, and it permanently decreases the amount you’ll need every month for the rest of your life.”  

I still stick to my guns in saying the easiest way to make fifty dollars is to save fifty dollars.  I had this mantra since I began my coupon journey about five years ago.  This was a time when I went from a single man living alone to having a built in family.  Feeding three people was an eye opener to say the least, especially when you were allotting yourself about $100 per month for food before.  Remember I was in the food industry, and usually always fed myself at work.

What this article did for me was realize that it really isn’t my income that is a problem here.  I have been making it work, and know full well that we could live on the income we do have.  It is really all about eliminating all the unnecessary monthly expenses.  

The biggest being DEBT.

Now I am not saying that I won’t challenge the other expenses, but debt is the biggest.  I have been paying anywhere from $800 to $1,000 every month for the last four and a half years, just on debt!  

What if I was using this amount to put away for savings and retirement?  I would be in a totally different situation than I am today.  

This is also not saying that I will not be looking for opportunities to increase my income.  Because let’s be honest the two go hand in hand.  If I increase my income it will be a much faster route to get out of debt and start becoming the provider that my family knows I am.  

So for the month of July I will be reviewing more of my expenses and seeing ways to cut them out of my life.  Who’s with me?


I couldn’t wait!!!

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I broke my cardinal rule. I counted my proverbial chickens before the eggs have hatched. And I’m taking a bit of a risk to do this, but…..

I JUST PAID OFF MY WELLS FARGO CREDIT CARD!!!!!!

(*cue the herald angels singing and imagine my euphoric screams here*)

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This was a big – HUGE – deal.

Starting to write here has changed my life (I know this sounds cliche and silly given that it’s been 2 months, but I’m for real). I swear, if I had continued just as a reader (not contributing), there is NO WAY I would be here right now. These past couple months we’ve done pretty well with pay. So we’d be sporting flashy new clothes, or perhaps taking a fun summer vacation. We would put a little extra toward debt, too, but we certainly wouldn’t be throwing every single penny possible toward debt payments and, thus, be in our current position.

You don’t know how happy this makes me! Since I’ve started here: I paid off my Capital One credit card (once maxed out at $7500, balance when I started blogging in March = $413). Next, I paid off my Wells Fargo credit card (once maxed out at over $10,000, balance when I started blogging in March = $7700). Next on my radar is my last credit card, Bank of America. With “only” a balance of $2200, it should be gone within a month.

How did I do this?

First, we’ve been cutting back (I have a whole money-saving tricks series!).

But let’s not kid ourselves, this has primarily been due to increased income (well above our “average”). And every extra cent has been thrown toward debt.

How else did I do this?

Well…..I cheated the system a little. I couldn’t help it. For those with variable incomes, this is a “do what I say, not what I do” moment…..

I have mentioned before that we have a budget (for all of our minimum expenses and debt obligations). We wait until the month is completely over to determine how much “extra” is leftover, and we apply that money toward debt in the following month (as a one-time snowflake payment).

Wellllllll…….I didn’t do that this month. It was driving me CRAZY to see my checking account balance high enough to pay off the WF CC and I didn’t want to wait until May was over to apply the funds! So, this messes up my budget a little but I ended up doing two things I would generally advise AGAINST for anyone with variable incomes (1) I spent money that will hopefully be in surplus from this month (May) to apply toward the WF balance (even though we don’t know yet exactly how much surplus we will have), and (2) I used some logic to assume that, should our surplus not be as much as I’m guesstimating….then I can “borrow” the money from myself. Our current monthly payment to WF is $900, so basically I’m using the June money and applying it toward our balance NOW instead of waiting a week until June is officially here.

I was able to do this because we currently have these funds in my checking account. If something were to go wrong (i.e., husband has work problems/doesn’t have jobs the rest of the month/terrible problem that costs money instead of making money), then it is still “okay” because I had this money available in my Capital One 360 Savings (I talked about all my assets in this first post…we don’t have a ton, but we do have some liquid cash in a money market account + CapOne 360 savings).

This is definitely “counting my chickens before the eggs have hatched” because the month isn’t over yet….so I have no way of knowing whether our income will truly be high enough to justify a huge (almost $3500) payment toward this bill.

But I did it anyway.

So hopefully when the dust settles from May I’ll discover that I made a good decision (meaning, we had enough “extra” money to cover this expense). If not, then that just means that our savings has decreased a little and – oh well. I think it was worth it to get out from under the 13.65% APR credit card debt (side note:  Now all of our remaining debts are under a 10% APR. For some reason, this feels like a big threshold to cross – even though I won’t be satisfied until we have NO debts and aren’t paying ANY interest!)

Oh happy day!!!!

I am smiling from ear to ear! Bank of America….you’re next! Mwhahahaha!!!!! (<<<< I love my evil debt-paying laugh! Feels so good! ) : )

Thanks for all of your advice, suggestions, and support along the way!!!


Travelling on a Budget

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I am getting the pleasure of revisiting one of my all time favorite activities these two weeks…travel! It’s something I wrote on many, many moons ago on my personal blog. You can read that old post here – The Toaster Oven – Road Trip Essentials. A lot has changed in our lives since that post…two more kids, new car, new technology, different ages, etc. (If you read my old post, you will see my paid off car that I sold once the boys were placed with us…I used all the proceeds to pay off debt, but I still miss that car every single day!)

I am EXTREMELY keen on traveling. It doesn’t really matter why or how or where, I just like to go. This is not something new, I’ve been this way as long as I can remember. (I’m sure the roots are in my rootless childhood, with 18 moves under my belt before college graduation.)  Since the twins arrived, we’ve cut back quite a bit, both for monetary and schooling reasons, but we have taken a couple of road trips every year to see family.

So for the next two weeks, we are on the road. Here are my top 10 tricks for traveling on a budget:

  1. Take food – we not only pack snacks and easy meals for the car, but we take staples so that when we are at our destination, we have the basics of meals without having to do a lot of shopping.  For us this includes: cereal, fruit and citrus juicer, rice, favorite seasonings and soups for microwaving.  One change for us is that we no longer take drinks, we each pack a tumbler including lid and straw and then fill them with ice water continually through the trip.
  2. Plan it – I have literally typed up our entire summer itinerary including travel dates, starting and ending addresses and drive times, drop off or pick up times for kids so I know exactly when we can/need to arrive.  I then sent this itinerary to everyone we plan on staying with (having asked them in advance.)  That way they know exactly where we will be and when to expect us…at least a ballpark.
  3. Look at the Map – I, for one, am in LOVE with my iPhone, I have an unlimited data plan so I type in my destination and then just follow the GPS directions. This is great; HOWEVER, take time to look at a bigger map of where you are traveling beforehand.  There are two reasons for this: 1) if you are not planning your stops, you can get a good idea of what big cities are on your route in case you want to site see or use hotel points for overnight stays and 2) using different mapping lets you see the big picture of different routes and may open up some overnights with friends and/or family without taking you too far off your route.  For me, an extra hour drive is worth it to have free accommodations, free food (at least in part) and get to visit people you may not see very often.
  4. Shop Around – As you probably gathered, I do not plan my overnights very often.  I realize that I could probably get better hotel deals if I did, BUT with four kids in the car and me being the only driver, it puts a lot of pressure on me to make drive times and a lot of stress on the kids with long car days.  For each leg of our trip, I use #3 time to scout out areas where we might want to spend the night for touristy reasons and then price out some options there, giving myself a ballpark of what it would cost.  With that number in mind and a fuzzy goal, we drive.  If we don’t make it, I pull off and see what’s ahead and try sites like travelocity.com or priceline.com to see what kind of deal I can get, but if we do, I know what I’m willing to pay and have never had a problem getting that rate.
  5. Take the Pressure Off – Of course there are times when you will have tight drive times where you must drive long and hard, but with proper planning, I find that those can be avoided most of the time. When you can, take time to smell the roses.  Stop at the silly tourist attraction. Take some pictures at the scenic overview. Or even just stop at a rest area and sit down and eat a picnic. As a parent and homeschooler one of my absolute favorite stops is at the welcome center for different states.  We look at the map and trace our route, learn the state motto, bird and flag and just generally see what the state is known for and has to offer.  I LOVE those stops, and the best thing…most of them are absolutely FREE!
  6. Spending Money – At 8, 10, 15 and 15, all of my kids are plenty old enough to manage and save their own money.  They work around the house to earn it, and I consistently remind them of what they have coming up that may cost money that they might want to save for. When we are on trips, they buy their own snacks, their own momentos and sometimes pay for their own “experiences.” Sometimes, they completely blow it and sometimes, they do really well and get some cool stuff and/or come home with money left.  I continue to think that time and experience will show them how best to use their money then me preaching at them about it and this spending money is a good way to do that.  It really stinks when something really cool comes along and they’ve already blown all their money on candy and only that experience can teach them that lesson. (I also save spending money for myself which I typically spend on a meal out or a family experience.)
  7. Don’t Forget about Home – It’s great fun to ride off into the sunset and leave the worries of your day to day life behind.  It’s not so great so come back from that trip and have a crazy high electric bill because you left the A/C on too low or a toilet running. (Yep, I’ve learned that one from experience.)  Make sure you stop your mail, reset your programmable thermostat for an empty house and unplug everything you can.  If you are leaving animals behind, make sure you’ve stocked their food and left good instructions for their care givers.  Just these little things can save you hundreds of dollars upon your return, believe you me.
  8. Prepare for Emergencies and Sickness – Take a first aid kit, take your insurance cards and just as importantly take those day to day medications that you keep stocked in your medicine cabinet and notoriously are going to need…cold medicine, bug bite treatments, bandaids, Tylenol.  These expenses can really add up if someone needs them, and you’ll feel really bad when you have a brand new bottle at home.  When you return, you’ll have two.  We also take grocery bags in case of sickness, rolls of toilet paper and baby wipes, between spills and other accidents, these are priceless!
  9. Gas, gas, gas – There are all sorts of apps out there that will tell you where the cheapest gas is – use them!  With my giant beast of a car, these really pay off.  If you take the same route many times, as we do to see family, you get to know the cheapest cities/states (like, don’t stop for gas in NC if you can possibly help it, and SC is typically cheaper then GA) so you can plan your driving accordingly.  I also am a big fan of finding the local Sams Club if we are in a big city to fill up and restock things if needed.  (With our family of 5, buying most things in bulk always pays off, I know this wouldn’t be true of smaller families.)
  10. Enjoy it! – I’m sorry, but no amount of money is worth torturing you family with driving 24 hours straight every time. And no amount of medical bills is worth staying in flea ridden hotel rooms. Taking a nap at a rest area can be fun, just remember to make smart choices. And sometimes that monument can be just as exciting as a roller coaster, especially if you have history buff children like mine.  Take the time to fully experience your trip, believe me, those memories will last a lifetime.

Bonus Tip: Take pictures, lots of pictures.  They don’t have to cost anything these days with all the digital technology and it is definitely true that a picture is worth a thousand words.

I didn’t write these in any particular order, and I will expand on details on some of these in later posts.  Travel does not have to be cost prohibitive and as the commercials says…the experience priceless.

 

 

 


Cutting Costs and Saving Money

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I’ve been diligently working at trying to cut some costs around here, with some mixed-results to share.

First, let me share another of my money saving tricks (see more here and here). This one really isn’t a “trick,” but still fun to share.

Remember how I mentioned that one of my friends was gifting me a hand-me-down dehydrator when she upgraded to a newer one? Well, I inherited the new-to-me dehydrator last week and I have been a FRUIT-LEATHER MAKING MACHINE since then!!!

To be fair, right now the prices on strawberries are at their once-a-year low. For the past 3 weeks I’ve been stocking up every time I go to the store. I’ve been able to get pints for as little as 89 cents, and I’ve bought about 2 pints per week the past 3 weeks. Some of them we’ve eaten (lots of smoothies and strawberries as snacks), some of them we’ve frozen for later (my goal is to really stock up now at the all-time low so we have strawberries still on-hand once prices go back up), and some of them we’ve used to make fruit leather!

It couldn’t be easier! You heat up strawberries on the stove-top with a little water (about 1/2 cup water per 4 cups fruit), then mash with a  potato masher (or throw in a food processor or blender), then add sugar to your desired sweetness, a little lemon juice, and that’s it! You can do it with all kinds of fruit, too. So far I’ve done plain strawberries, strawberry-banana, and strawberry-orange-pineapple. Loved them all!

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When it’s done dehydrating, I put the sheets of fruit leather on parchment paper, roll up, and store in the fridge. I did a calculation to see how much it costs to make my own versus buying fruit roll-ups from the store. I haven’t bought fruit roll-ups (ever), but I found a price for buying bulk online.

  • You can buy a 3 pack (10 roll-ups per pack) for 9.25 = .31 cents per roll.
  • I can make 1 sheet (4 roll-ups) out of 1 pint of strawberries ($1 or less) = .25 cents per roll.

Not a huge savings, but it’s 100% natural. It’s probably even more of a savings compared to the fancy fruit leather that’s sold in individual packages at stores nowadays. In all, probably not something we’ll be doing year-round, but its a fun little Spring treat when strawberries are in season and on sale for cheap!

Now, onto cutting costs….

I’ve been looking at every area of our monthly budget to try to cut costs and one thing I had zeroed in on was our phone bill.

I have a success to share – I managed to lower our phone bill (wahoo!), but perhaps not as much as I could have if we’d switched providers.

In the interest of full transparency, I <3 my phone! For real! I had pined over the iphone for years and finally bit the bullet and bought one when they came out with the 5c, since it was so much cheaper than the regular iphone (I switched from TMobile to Sprint in order to get it). So this is still really new to me. I’ve only had my “baby” for about 6 months at this point and I lurve it! I really do!

When talking about trying to reduce my wireless bill (it was a whopping $150/month!!!) many of you suggested that I switch providers. I looked into a couple of different providers – Ting and Republic Wireless, for example – but no one would let me keep my beloved iphone.

So I called Sprint and told them I need my bill to be lowered. The guy let me know we weren’t using nearly as much data as I had believed, and that we could get rid of our unlimited data and downgrade to 1 GB per line and still have data to spare. This was moving to their “Framily” plan that’s being heavily advertised now. And although we didn’t save $100/month, as we might have if we’d switched providers, I did manage to get our bill reduced by approximately $50/month (down to $100 from $150). The new plan didn’t go into effect until the 25th of this month so I won’t see the savings until the next month’s billing cycle ends but every little bit helps!

But….I did mention “mixed results” at the beginning of this post.

So, where have we done *ahem* not so well?

Well, you’ll have to wait for a full budget update from the month (coming next Monday), but I definitely went over my limit in a couple of categories. Nothing too terrible, but still not what I’d hoped. The only thing I can say in my defense, is that the overspending came from one specific category that I had tried to slash by over 30%. Our spending wasn’t outrageous, but it was pretty much in-line with the “old” (pre-slashed) budget. So I’m hoping this was just a growing pain that takes a month or two to figure out and hopefully we can work harder to spend less in future months.

In the meantime, I’m trying to finish the month strong. No spending of any kind until the 1st of May!

 

What have YOU have done lately to cut household costs and/or save money??


Ask the Reader: Frugal Kid’s Birthday Party Ideas

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My younger two share a birthday party every year, and that time is coming up in just a couple of months.  We’ve had combinations of paid party locations: Chuck E Cheese, local inflatables, Paint on Pottery, etc. as well as at home in the back yard type parties over the years.  I am definitely guilty of going overboard, but I have always rationalized and said that since it’s for two kids, it’s okay to spend a little more.

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This year, that is NOT happening.  Both kids have been told we are cutting back and I’ve asked them to start thinking of ideas for their party this year.  Here are the possibilities I’ve come up with:

  1. Homemade pinata – paper mache project we could do as school project for pretty much nothing so the only cost would be to fill it with goodies.
  2. Homemade water slide – big tarp laid down in our slightly sloping front yard with an adult spraying a water hose.
  3. Homemade cup cakes which everyone gets to decorate themselves – saves the cost of a “professional” cake/cupcake, but would require several frosting and some sprinkles
  4. Meet at the local park, invite the friends and just have a big playdate
  5. Invite one friend each to go to Rebounderz or Bounce House or a movie
  6. Buy a small canvas for each friend and having a  painting party in the back yard with snacks (kids weren’t keen on this one at all)

I guess the birthday party is the one part of their lives I have not let go of the “magical” childhood thing and it’s cost me plenty over the years.  I am determined to no only be frugal this time around but even CHEAP!  I have made it clear to both of them that I want to hear their input and desires, but I have to balance that with a very tight budget.  So I’m here asking for your help….

What frugal, yet magical ideas do you have for a child’s birthday party?  Any and all help would be greatly appreciated.


Ashley’s Money-Saving Tricks

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I want to start a series of money-saving tricks that I have started using since kicking off this debt-reduction journey. Hopefully these tricks will help reduce some of our monthly expenses (pssst: revised budget coming this afternoon). Here’s my first money-saving trick:

Homemade Cleaning Spray and Reusable Rags

I have actually been making my own cleaning spray for years. I started because of health/safety (I wanted a 100% natural cleaning solution for cleaning high chair surfaces), but it also had a side-effect of helping out the wallet. Since starting my debt-payoff journey, I also decided to eradicate paper towels from our lives.

To be fair, we still have some paper towels leftover from a Costco run I made in late February, but I have already switched over to reusable rags. If all goes well, hopefully our hoard of paper towels will last the entire year of our credit-card eradication challenge since we will only be using them very sparingly (side note – I also saw a tutorial on making DIY baby wipes out of paper towels for WAY cheaper than store-bought wipes, so that’s an alternative, too). The only thing I’ve noticed so far as a disadvantage of reusable towels is in regard to cleaning mirrors. The rags always leave streaks and little bits of rag “fuzz” behind. Any reader tips on how to avoid this?

Otherwise, I’m really trying to stick to the rags. In our case, the rags required no initial investment. Because we had twins instead of a singleton, we were gifted an obscene amount of burp cloths (which were all IMPERATIVE when the girls were babies). Now that they aren’t needed as burp cloths, they’ve just been sitting in our linen closet taking up space. I have just repurposed these into our cleaning rags. They’re the perfect size and I don’t have to run out and buy a bunch of towels to replace the paper towels. Win-Win!

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Dirty baby table about to get cleaned with a burp cloth and homemade cleaning solution. As you can see, I have reused an old spray bottle (you can tell from the picture it’s pretty old, as the label is peeling off). No up-front costs, only savings!!!

I have a link to my pinterest in my author info in case anyone is interested. I have a board of DIY ideas that I have used, and there are links to several homemade cleaning solutions you can use to save yourself some money, too!

and one more BONUS money-saving trick….

Free Magazine Scam

I’m sure we’re all familiar with the free magazine scams, right? These are when you get a mailing saying you can get a free magazine subscription for “X” months….but then they never remind you to cancel and the subscription auto-renews and CHARGES you!!! Familiar?

Well at the beginning of January I got an offer for FIVE free magazine subscriptions. I have no idea how this happened – I haven’t subscribed to a magazine in YEARS! But the mailing said that depending on the magazine, I could qualify for 6 months up to 1 year for free! Don’t mind if I do!

I went ahead and signed up for a bunch of magazines. Turns out I got 4 for one full year, and 1 for 6 months. All totally FREE!

Here’s the thing……the magazines are banking on you forgetting to call and cancel in time, and then they get to charge you! I am meticulous about keeping a planner (I would never remember all my various deadlines and due-dates otherwise). So I write in my planner the phone number, magazine subscription information, and a big note to CANCEL a month before the free trial ends (just so there’s no confusion or funny business).

But I don’t really care about magazines. I sometimes flip through them while the babies are taking a bath (I sit in the bathroom supervising, but they love to play in the tub so it could be a good 20 minutes or so), but I could do without them and don’t need them or anything.

So what’s my trick????

Almost as soon as I receive them, I take them to our local book resale shop (called Bookmans). It’s important that I take them soon after they arrive because then they are still the “current” issue. I take them to the book store and “trade-in” for store credit! I use the credit to buy books for my babies!!! Voila! Free books!!!

Me?? I’ve always been a library-girl. But my babies are so destructive they are NOT old enough yet to be responsible library-borrowers (they’re not even 2 yet), so we can’t borrow   baby books from the library for fear of a book getting a page torn, a sippy cup spilled on it, etc. But the books at the resale shop are cheap anyway, and once I use my 5 trade-in credits per month, I’m always able to walk away with 1-2 new-to-us books for the girls absolutely FREE!!!

So there you have it! Two new ways you can save some money!

What’s your favorite money-saving “trick”??? 


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