imagrownup

[imagrownup]

Whoa There

Been a while, no? I guess I’ve lost interest in blogging.  (And probably avoiding holding myself accountable for my horrible financial decisions over the past few years).  

I finally hit the point where I really can’t maintain the way I’ve been spending.  I haven’t maxed out my credit cards, but I’m almost at the point where I would not be able to make the minimum payments required.  I thought about consolidating through Payoff or SoFi but changed my mind since I couldn’t change the way I distributed the loan.  So I’m going to rough it and just pay off the cards at their current interest rates.

I’ve got just over $20,000 on one card with mixed interest rates- 15% on part of it and a 0% balance transfer promo on the part.  I’ve got $27,000+ on my Chase Sapphire Reserve card which has a 16% apr.  It’d be preferable of course to have a lower interest rate and maybe I will transfer it to a personal loan in a few months, I don’t know.  Lastly, I’ve got $7575 on a Citi card with a 0% promo that ends in March.  I’m hoping I can get it paid off before March gets here, assuming I get a decent amount for my tax refund in February/early March.

I’m planning to pay off the Citi card first, then the CSR, and then my BofA balance. It would be great if I can do this in 24 months, but right now I’m aiming for 36-ish.

In this moment, I’m feeling determined.  Going to keep this same energy until it’s all paid off.

[imagrownup]

Budgeting For Beginners

Whether you’re just starting out on your own or want to re-evaluate your spending habits, hopefully this list has something for you!

Determine How Much You Actually Make After Tax/Retirement 

Check your pay stubs - most jobs allow you to do this online. Use the final take home pay as the basis for your budget. 

This may change month to month so use a lower amount as your base for your budget

Figure Out How Much You’ve Spent The Past Few Months

From rent to entertainment, everything should be accounted for. 

Make a list of everything you buy. You need to know what you’re spending to help guide your budget.

If you aren’t sure where your money is going, there are a few options. You can use an online service like Mint that tracks the categories of your purchases. You can also go through your card statements and see what you spent. If you use cash, try and log all purchases in a notebook or on your phone.

I can guarantee you are spending more than you think. I can guarantee it because my husband and I, and all the friends I’ve helped build budgets for have been shocked at what we spent before budgeting properly.

Break Down Every Expense - Everything. Leave No Dollar Unscathed

Your budget is built on how you decide to use each dollar you have. Now that you know what you’re spending your money on, you can decide whether or not that amount is reasonable for you. 

You need a category for every dollar. My husband and I have almost 20. Mortgage, grocery store, eating out, entertainment, medicine, clothing, home goods, gas, car insurance, every other kind of insurance, etc. 

Figure out your categories. No two people will have the same and you’ll find over time what works for you,

IMPORTANT: The categories you need to figure out first are the essentials like rent, food, insurance, loans, medication, energy, etc. Always work those out first because those are the ones you can’t mess around with.

From there you can break down the fun stuff, the want to do stuff, and the long-term goals/saving goals.

Excel Is All You Need

Once you’ve figured out where your money needs to go and how much goes in each category, you need to record it. 

Set simple rules (you can google them) that allow you to add up how much you intend to spend in one column and how much you spent in another. Have one row per category and excel will do the math for you. 

Keep a template of your budget and copy one for each month. Never write over a previous month’s final budget. Keep everything so you can track spending trends over time. This helps save money because you can cut costs in places you don’t spend as much as you anticipate and place that money somewhere more valuable.

Look at the budget at the end of every month and add up everything you spent for each category. Mark the final number red or green so you have an easy visual of your under/expected spending and over spending. This helps you adjust over time.

Build An Emergency Fund ASAP

Emergency funds are the backbone of financial stability. Whether it takes three years or three months to build your fund, do it as fast as possible. Even if this means cutting on things that are “extra” like a movie or video game. The peace of mind that comes from an emergency fund is worth a few extra dollars a month if you can swing it.

Ideally, an emergency fund should be three-six months of your income. But that’s the textbook definition. And this is NOT feasible for everyone and I’m not going to pretend that people can do this is all situations. Nor shame anyone who can’t because I want to encourage people to save as they can. Whatever money you can save is worth it. 

Make your money work for you because it’s a utility, not a jail cell. It’s a tool and an emergency fund is another tool in your toolbox. 

Reevaluate Your Budget and Goals Every Few Month

Situations change and so do goals and aspirations. Your budget should reflect your life as it is now while breaking down the process to lead you to your long-term goals.

If you’re saving for a car, include a section in your budget that you’ll drop $50 a month in your saving account and it will take you x months to get your car.

I also recommend a separate box in your excel sheet that lists your wants over time so you can evaluate and keep your goals top of mind when you look at your budget every month.

My Favorite Budgeting Resources

reddit.com/r/povertyfinance - I really like reading this subreddit because it is nonjudgmental, honest help for people with a tight budget. It includes everything from insurance to building an emergency fund. it’s an amazing place.

reddit.com/r/personalfinance - The OG PF subreddit. This subreddit is also a good place to look for ideas and inspiration on how to manage your money. The people on this subreddit are often a bit well off and can come across out-of-touch at times. But there is still a lot of good information about everything PF.

reddit.com/r/financialindependence (also known as the FIRE subreddit) - FIRE stands for Financial Independence, Retire Early. These are the people looking to invest, save, and craft their money to retire early. Honestly, this subreddit is fascinating, but if you aren’t looking for investment and high earner money management, this probably isn’t for you at the moment. 

Mint: Budget Tracker and Planner - My husband and i used Mint when we first got out of school to help track where were were spending our money. We only used it for a few months but it made a huge difference. 

—-

Note: I am not a fiduciary or certified financial advisor. My husband and I simply love budgeting and personal finance. I want to share our tactics for others to use and adapt as they see fit.

No two people’s budgets are the same and what works for us may not work for you. But I certainly hope something in this list helps you get a good start on your own budget. Because EVERYONE needs a budget.

[imagrownup]

I made a decision today.  I exited the Income Based Repayment plan and entered into the Extended Graduated Repayment option. I saw that the payment difference is just over $500/mo.  It’s going to be painful to watch the interest that I’ve worked pretty hard to keep paid off for the past few years go up. However, my purpose for going into this new plan is so that I’ll have more money each month to put toward my credit cards. I am anxious to pay them down as soon as possible.  I’ve worked out the math... roughly.  My numbers are all super tentative because I really don’t know what my take home pay will be next year (or any year after) because I’m not sure how much will be deducted due to taxes, union membership fees, etc.

Assuming I stay with my current job, my salary doesn’t decrease, and I don’t encounter some really crazy cost then I could pay off my credit cards in two years.  If I get another raise next year and it’s 2% or higher I could pay off my cards in about a year and a half. Assuming I don’t accrue additional credit card debt- and that is key: I really want to make sure I don’t add on more debt.

I’ll have to use my tax refund (hoping I still get them) and retroactive pay raises (again hoping I still get them) each year to pay off any accumulated interest on my student loans so that the amount owed doesn’t take off and run crazy again. After I pay off my cards, I’ll put all of the money spent on credit cards previously and apply it to my student loans.  If I can knock off a huge portion of the credit card debt, I might be able to refinance my home in a reasonable amount of time.

[imagrownup]

I like this idea. I had considered (might have even done it once) this before.  I think it would help me to keep a clear idea of what’s really available to use.  I’ve gotten used to getting paid once per month (mostly) but it definitely takes some concerted effort on my part.

[imagrownup]

Credit Card Repayment: The Plan

Ok... I now have 3 cards that I’m paying off. I opened up a new account a couple of weeks ago to do another balance transfer.  So 2 of the cards are 0% for the time being because of balance transfers, the 3rd is a Chase Sapphire Reserve at 18.24%

Whoa. 

I have $6666 left to pay off on the CSR card. My goal is to attack that as much as possible and then focus on the other 2. My issue is that even after taking out my first balance transfer, I added more debt onto my CSR card. I’m paying the minimums on the other two cards now. I’m getting a raise that will be backdated to August in June and a bonus in July.  I’m predicting that after taxes the total of the two could amount to about $1500-2000. Of course it would be great if it were even more, but I know it won’t be $6000. 

My Chase card is linked to my therapy sessions which are $175/week. I could just change it back to my debit card but I’ll just rack up points and set a weekly autopay in the same amount from my bank account. I will not cancel on the weeks I don’t end up going in for therapy since the extra payments will help. I also have an automatic payment of $219/mo which is leftover from when I had an unlimited pilates studio membership.  If I have money leftover each month (I probably won’t for June, July, and August) I will use it to pay toward this card.

I’m removing this card from my Google autosuggestions and from PayPal. I already switched my internet bill to withdraw from my bank account instead of the Chase card. I’ll be doing the same for my alarm system today. I will continue using this card (or a card) to pay for gas since I’m paranoid about my debit card/checking account getting skimmed.

[imagrownup]

So like... super quick turnaround. I already got refunded and it came out to $52.69 (forgot about the tax).

I spent a lot of money on shopping last month. In fact, I spent almost $300 on designer underwear off of Yoox. I know- terrible. They’re all non-refundable of course. I found out that two items went on sale after I purchased them, but Yoox has a price adjustment policy. I just emailed them and should get back $49.

[imagrownup]

I spent a lot of money on shopping last month. In fact, I spent almost $300 on designer underwear off of Yoox. I know- terrible. They’re all non-refundable of course. I found out that two items went on sale after I purchased them, but Yoox has a price adjustment policy. I just emailed them and should get back $49.

[imagrownup]

No Spend Diet

I decided that June will be a no spend month for me. Gonna be a challenge. I did spend money yesterday- on fast food for my dad and sister as “payment” for their help on my house.  My rules... no spending on anything unless it’s:

for the house (excluding furniture)

groceries

gas

gift

related to the baby shower I’m planning

my friend’s birthday event

work-related

The hardest part will be avoiding social activities and shopping. I have been a shopper for quite some time, I’m trying to change that aspect of my identity.  Some steps I have taken/am taking to avoid falling into the traps and getting tempted to buy clothes and other unnecessary things: deleted shopping apps from my phone, unsubscribe from marketing emails, managed my ad preferences/edited my Facebook interests in an attempt to decrease targeted ads, avoid directly visiting shopping websites.  Targeted ads will be a big challenge.  Unless I decide not to scroll through my Facebook news feed or Instagram feed, I don’t know that I’ll be able to totally avoid the ads.  

[imagrownup]

Hey... been a while.  I’ve thought about posting here but wanted to save myself some embarrassment.  Instead, I’m just going to post because I clearly need accountability.  I’ve finally come to the point where I am truly ready for change. To change. Here’s a brief synopsis of what’s occurred since last January. It’s a doozy.

I am still a homeowner, I still haven’t moved in yet because I’m still renovating.

I bought a used luxury car last April. It looks beautiful but the car note does not.

I accrued more credit card debt than I ever have before. Almost $30,000. I thought not purchasing my home almost two years ago would be a great way to avoid opportunity cost due to housing prices increasing but I’ve gone into debt renovating this house.

My student loans are still a thing. I’m still paying them off, I no longer qualify for income-based repayment.

Even though I make six figures now, I am living beyond my means and with all of these bills, it’s hard to get out of debt as soon as I’d like.

So... there’s my truth.  Tonight, when I get home from work I’ll lay out the numbers and dig myself out of debt once again. One dollar at a time.

[imagrownup]

Long time no write.  I’ve had a million thoughts about personal finance, home ownership, and all of the things I really want to buy but can’t because it wouldn’t be responsible.  Over the past few days I’ve been contemplating whether or not I should splurge and get myself back into credit card debt by getting custom made kitchen cabinets or if I should go the cheaper route and get RTA (ready to assemble) cabinets off of the internet. I thought I was certain I would do the latter but now I’m just not sure. If I do go custom, it will put a limit on the things I’d like to do- nice appliances for my kitchen, the amount of shopping I can do on my upcoming trip to Europe, the specific car I’d like to buy myself this year.

I’m realizing now that I didn’t completely think through the amount of work my house would demand.  However, if I hadn’t purchased it when I did, I would have been priced out.

[imagrownup]

So clearly I’ve decided to no longer post my monthly updates.  Now that I have my home and have paid off my credit cards I don’t see a good reason for it.  

However, I decided to take a closer look at my student loans today.  Super disappointing.  Back in June I decided to scale back on paying extra to my student loans and to just pay the minimum while I was saving for my home.  I accomplished that but I built up so much interest in the process.

Here’s what my balances were back in April:

Here’s where they are now:

What a shame!  So, fortunately, my balance on my first direct loan is lower than it was before due to the extra payments I’d been making from May and June.  Payment history here:

So I seriously need to tackle this.  My goal, perhaps too ambitious, is to knock out that first Direct Loan with the $6555.57 balance.  This is the loan from undergrad.  May 10, 2018 will mark 10 years since my college graduation. (I feel old as hell admitting that.) So I need that loan to disappear.  That would mean paying an extra $937 a month between now and May to achieve that goal.  That’s $937 on top of the amount I pay on a monthly basis already.  That amount is set to increase after I renew my Income Based Repayment plan.

I hate that I let it get this far.  I’ll probably have to sacrifice a new car this coming year in order to reach the goal of getting rid of this loan.

[imagrownup]

The moment I’ve waited so long for... 800+ I’d like to thank the academy 🏆

[imagrownup]

Home Ownership

Le sigh. So... owning a home is weird (for me). Mostly because I don’t even get to live there.  I get to pay a mortgage (first payment is due like tomorrow), gas & electric bill that is strangely higher than I’d expected since no one lives there, a Comcast bill for internet that isn’t even active yet (I’m calling them to see if they’ll prorate the first month but they’re evil so I doubt it will be easy), and eventually I guess I’ll get a water and garbage bill.  I should probably replace my mailbox soon so that I can actually access my mail. But back to my point.

I’m paying a bunch of money but reaping no benefits yet.  Also, I’m completely lacking motivation to get stuff done on the house.  I don’t feel like hammering the nails into the floor so that I can get my hardwoods replaced.  I’m totally grossed out by the window cleaning I did a couple weekends ago so I’m hesitant to continue with the remaining windows and having to clean the walls.

I’m also indecisive and/or stuck on some of my finishes. I don’t know what color I want my wood floors to be, don’t know if I should start with redoing my kitchen or bathroom first, and I can’t figure out a layout for my kitchen.  I hate the current set up for my appliances (range and fridge) but there probably isn’t enough existing room in the kitchen to place them elsewhere.

So that’s where I am. Frustrated, bleeding wallet, and indecisive.

[imagrownup]

Home Purchases

So here’s what I’ve purchased so far to get things going with my home.  Most of it is for security, since I won’t be living in my property while it’s under construction.

Kwikset 916 Smartcode Deadbolt

Door knobs and deadbolts for my front security door, garage door, and back security door

Ring Doorbell

Simplisafe security system

New front porch light

Replacement garage door opener/remote

West Elm coffee table

[imagrownup]

House Update pt 2

So as you can see from my previous post, I’ve got the house.  I signed my closing documents on Wednesday, August 30th and received my keys on Friday.

It was such a long process but I’m glad all of that is behind me because now I need all of my energy to updating this place! I was a bit disappointed that they’d already taken down the “Sold” sign when I went to the house a couple of days after closing so I don’t have a picture next to it.  I was too superstitious to take one during the whole month it was there in front of the house.  Oh, well.

So far I’ve made quite a few purchases for the home, mainly to secure it since I can’t move in until a lot of the work has been finished.  I’ll put up another post with all of my purchases.

To date, we’ve (being me and my parents- my dear old dad’s done most of the work):

 changed all of the locks

put in new light bulbs on my front porch light

programmed my new garage door opener

removed these insane booby traps the previous tenants placed on the side gates (screws nailed into blocks of wood to prevent intruders climbing over the fence)

removed the hardwood floors and baseboards from one of the bedrooms

removed the cabinet doors in the kitchen

I’ve finally found someone to remediate the mold in my basement for a reasonable price but I may have to get an environmental company to remove one of the walls due to asbestos (I have to check that it really does have asbestos).

I’m removing all of the hardwood floors throughout the house and I’ll have to clean out the mold upstairs with a bleach solution. I’m doing this part myself to save money. I’ll use a mask and proper equipment.

Where I’m currently stuck is on design and funcitonality as it pertains to my kitchen and bathroom. I plan on gutting both and I’ve got to figure out the best replacement vanity that won’t require me to call in a plumber.  I also can’t decide on the color for my hardwood floors.  And in the kitchen I need to determine the best placement for my range and fridge and I’ll more than likely need to move the vent/hood for the range.  I’ll also need an electrician to help get rid of all of the illegal wiring in my basement, fix my doorbell, install ceiling lights, change my flush mount light in the living room to a ceiling fan, and... the list really does go on.

But I’ll end things here for now.  Is anyone even reading this?

[imagrownup]

August Totals

I’m late... I’ve been busy (lazy), but here it is.

I plan on paying off my credit cards tonight.  I’ll have to really slow my spending after this month since next month’s pay check will be going toward my first house payment.  This house is going to be the majority of my paycheck each month until I refinance.

I’m not sure why there’s such a large difference with my student loans... I haven’t made any extra payments. Maybe I miscalculated? Idk.

My savings isn’t actually reflecting the true amount I have. I have a $7,000 and some change check to pick up from the title company and I took out a $6000 cashiers check that I didn’t need and have to send back to my bank to be redeposited in my account.  It’s going to be quite useful for all of the work my house will need.

[imagrownup]

July Totals

I did a little shopping and used my credit card but I paid it all off (plus the remainder of what was spent on my work trips and Mexico vacation).  Everything else has pretty much remained static. I’m still not putting anything extra toward my student loan due to the house and the repairs it will need once it’s mine.  Retirement is pretty much the same because my pension does not earn anything during the months I do not work.