Debt Hater

June 2008 Monthly Report

    Ok, so even spending willy nilly didn't put me in the red.

    On the contrary, I am well in the black.

    But, I went over budget in the same old categories, so I'm not going to go in detail there because you've read it dozens of times before (groceries and clothes, specifically), but, honestly, in many categories I either came in right at budget, or just a few dollars over.

    More importantly, I've spent a lot of time in the last few days figuring out my game plane for July and the rest of 2008.

    First, an announcement -- I have a POSITIVE net worth! If you include my car, savings, checking, and 401k, my net worth is $16,100. Imagine that! That's $26,000 swing up from where I was a year ago!

    Now for the start of my rest-of-the-year plan:

    1. Pay myself first. I'm actually going to do this now. I have budgeted for saving 10% of my income. Some of it will go into my 401k at work, while the rest will be cash savings dedicated to building my emergency fund, which, right now, is $3,200! I plan to have this money taken directly from my paycheck, rather than transferring it myself from checking to hi-yield savings (or set up an automatic transfer). I'm hoping "out of sight, out of mind" will apply here!

    2. Adjust taxes and savings. The IRS isn't totally useless. I used IRS.gov to figure out just how much I should owe the gub'ment for this year. The form was easy to use (have your tax return and a recent pay stub available) and it told me just how much I should owe and how to adjust my withholdings to stop me from overpaying.
    According to the site, I was going to overpay my taxes this year by $1,000. Instead, I could adjust my withholdings so that I would overpay just about $200 (anything more and I would wind up owing the Feds).
    So, I changed my withholdings to the suggested figure. The money that I will keep in my check is going straight into my 401k, PRE-TAX. So, I'll be saving more in my 401k AND lowering my tax liability at the same time.

    3. Create a $0 balance budget. In other words, rather than only budgeting for some things, I budgeted for just about everything. I kept it simple for now -- I took a 6-month average of my spending on everything I recorded in my spreadsheet (right down to postage stamps and library late fees). I used that to budget for all the categories in my spreadsheet. Even "miscellaneous" has a limit. Right now, that balance isn't exactly zero, it's more like $30.
    Honestly, I have long been afraid to account for every last penny like this. I thought it wiser (and it made me feel safer) to have a considerable amount of cash left over after accounting for bills and essentials. But, that makes little sense, because I was often fooled into thinking I had more cash available than I actually did, thus spending it, when it was really covering something else.

    Those are the three big things. The next few thing I want to investigate is a higher-yield saving method for my emergency account. I was thinking about I Bonds, which I read about at the Motley Fool. But, I need to do some more research.

    DH

   

Saturday of My Peculiar, Expensive and Ultimately Satisfying Weekend -- Part II

  (This is an updated version of the post. The previous version somehow omitted the entire second half. I apologize for the confusion. The complete post is now up).

    Saturday.

    After Friday's frustrations, I was looking forward to a fun-filled Saturday. But first, there some things I wanted to do around the apartment and an errand or two I wanted to take care of before I went on my way.

    Famous last words...

 

A Peculiar, Expensive, but Ultimately Satisfying Weekend Part I

    Whew!

    That's my weekend summed up in a word.

    It all started on Friday. It was a beautiful day, albeit very hot first thing in the morning. My guy is out of town and I planned a fun, active weekend for myself. I just needed to get some errands straightened out first thing in the morning, live through work until 5 p.m. until a Happy Hour with co-workers and then I was going to take myself out dancing.

    So I got up, got dressed in a very cute outfit with my new pair of kelly green ballet flats, a yellow top from Banana Republic and my high-waisted, wide leg jeans from H&M. I finished the look with my white headwrap and these yellow dangly earrings from Target.
    Before I went to work, I was going to take the paperwork from my auto loan lien holder to get a clear title. This was my moment to make my car, my own OFFICIALLY!

    Sound good? It all went sliding downhill before I even got to my office.

Seriously, somebody stop me!

     Co-worker told me about a shoe sale at Steve Madden online, free shipping. I bought three pairs of shoes.

    SCREEEECH! Huh?

    Yeah, I'm bugging the heck out.

    So tonight, I sat down at my laptop and started doing some cakalations (that's how my gram says it. It's Cack-a-lator, not Cal-cu-lator). I went to my spending record spreadsheet and added up every penny I've spent in every category for the last six months and worked out the average for each month.
    Next, I am going into my budget and actually budget for all these "miscellaneous" items that I don't actually budget for, but wind up spending money on. I will also make adjustment to things I do spend money on so that my budget for the month is more realistic.
    But most importantly, I am going to set up some automatic deposits -- straight outta my paycheck. Single Ma recommended to me that I make a lot of this automatic. If it's gone before I see it, I can't spend it.
    That's kind of like, well of course, but understanding something and actually doing it are two different things.
    It's been such a relief to see money in my checking account and know that it's not already spent in the coming month. But having that knowledge has woken up that little devil that used to sit on my shoulder, back when I didn't know any better. "You don't have to spent that $950 a month on debt payment anymore! What's a pair of shoes? Come on!"
    Get thee behind me Satan!

    Seriously, I'm not in trouble. I am not building debt. But I ain't building wealth either, so I still have a problem.

    Anyway, my task for the end of this month is to figure out the next steps I need to take with my cash. I need to put that money to work so I'm not blowing it. Don't get me wrong, I plan to have a fun summer and enjoy some things, but I am not going to just blow my was every month and say, "It's ok, because I'm not in the red!" Uh, no.

    And PS -- for those wondering -- I did send back those pants from Anthropologie, not because I felt guilty, but because they didn't fit, like I knew they wouldn't. So, really, I'm out $5 because of the folly.

    Lord help me.

    :-)

    DH   

You've Come A Long Way Baby... But Your Money's Got Catching Up to Do!

    Last night I went to a new support and encouragement group for women in debt (or recently out of debt who are now trying to improve their money situation).

    It was interesting.

    Some of the advice was too basic for me (spending record, budget, snowball debt payments -- check), while other stuff was over my head (ANYTHING that has to do with saving for retirement).

    I wasn't sure how I would benefit from the group or how I would be a help to the other women. But listening to their stories, I was amazed and impressed, appalled and shocked and confused.

    One woman was impeccably dressed with a huge gold watch on a thick gold chain wrapped around her wrist with D&G (I assume Dolce & Gabbana) on the clock face. She told the group that she used $6,000 a month to pay bills, including her debt, leaving her with $4,000 in disposable income a month. But she didn't know where it went. She was living paycheck to paycheck. She was so short in her checking account, that she wondered if she should take out a few THOUSAND from savings to make it to FRIDAY. It was TUESDAY night!
    I almost choked on my water.
    I don't EARN $4,000 a month after taxes, let alone LOSE $4,000 a month!
    I thought, please God, let me get $4,000 a month free and clear just for a little while and I'll max out a Roth IRA (I'll max out two if the law allows it!), save six months worth of living expenses in a liquid, but interest bearing emergency fund, and save 20% for the down payment on a house. Please God, please.

    Another woman has $100,000 in student loan debt (yikes!) which worried her deeply, but she also had $12,000 in consumer debt, but she wasn't worried about that. "That's nothing to me," she said.

    Um, what? No, it's not $100 G, but it's scary to me how so many people in this country think that $10,000+ in consumer debt is normal and not a big deal. It isn't until you try to pay it off and see that you can't do it in two paychecks (unless you're like the first woman who makes $10,000 a month AFTER taxes).

    But then I had to take a deep breath and take off my judgmental hat. The whole point of this is that people -- no matter how brilliant and obviously successful and well paid they are, like many of these women -- still don't always know the first thing about financial fitness and true wealth.

    These women were under 30 and owned their own homes and had multiple degrees. Shoot, I was the starving artist in the group, about to be 31 and not close to owning a home or making that kind of bank. But they were lawyers, information technology managers, aspiring doctors and professional students and they didn't know what exactly "discretionary spending" meant.

    It was amazing.

    I thanked them for their laudatory attitude when I explained that I just paid off my debt, including the car. I appreciated it. But I also thought that maybe we can all help each other get educated. Because, it seems, with all the money we spent on school, all that we invested so that we could make the big bucks, we were seriously lacking financial education.

    Isn't it ironic? Dontcha think?

Somebody... Stop... Me... From... Shopping!

   

When Bruce Banner gets angry, he turns into the Hulk, a big, green super steroid monster that smashes and destroys until he's spent.

    When I'm debt free and the sun is shining and my money is, for the most part, my own, I turn into Shopper Girl who checks in on stores, looks at bargains online and buys new little trinkets until her money is spent.

    Yesterday I bought a cute pair of green flats (they were on sale!) to go with my cute kelly green shirt I bought at Banana Republic over the weekend. And then wore the little yellow earrings I got from Target (they were just $5, come on!), which also happened to look fabulous with my purple shrunken cardigan (also from BR and also on sale) that I wore with my yellow tank top and wide leg jeans. I'm the stunna I tells ya! Oh yeah, and the other day I ordered some hot to death seersucker pants from Anthropologie, even though they didn't have my size in tall. I figured the size down could still fit... and they were on SALE!

    HELP! I think I've been invaded by body snatchers! Those are NOT words that could be coming out of my mouth. On Sale? Since when do I give a crap!? I'm always going off on people who justify their unnecessary purchases because they were "on sale." If you buy an antique, ivory back scratcher for 50 cents when it's normally $1,000, you still lost 50 cents because what the heck do you need that for anyway?!

    The thing that kills me is that I never was a shopper. I used to tell people that I hated shopping and when I did shop, I shopped like a man: "Need this. Right size. Right color. I take it. *Grunt* No more need for clothes." Then I'd scratch myself.

    I don't think I need an intervention just yet, but who wants to get to the point where they need any intervention!? That's about two minutes to too damn late in my book. I don't ever want to get to too damn late again in my life.
    I'm fine now. I'm not going in the red. I don't owe anybody and won't even after I get my Anthropologie pants, but I just don't want to undo in a matter of months all the discipline I spent two years building up.
    Maybe I just need to get it out of my system.
    Maybe I need to stop dilly dallying and set up some S.M.A.R.T. goals so that my money is going where it needs to automatically and, thus, not available for me to just spend on whatever.
    Lord, I need counseling :-)
   
    Happy Friday!

    DH

   

Oops, I dun spent all my cash

    So, uh, I paid off my car.

    Fine.

    Then I went grocery shopping (can't seem to spend less than $50 a week no matter what I do). I also bought some umbrellas since I managed to lose two on the Metro. I bought a big one to keep in my car and a green Totes to use in my purse.
    Then I bought a pillow since my pillow was all flat, mushy and icky.
    Then there was my $300 weekend as I previously described. And then there was some checks I had written previously, and accounted for, but folks didn't cash until, like, just now.

    So, um, all that pretty much wiped out my checking account. I mean, it's not at $0.00 or anything, but, um, if I need to spend any money on anything else, I shouldn't. It'll be a whole week before my next paycheck comes in. I am still on track to finish the month in the black, but dang, talk about frontloading!

    DH

Singing, Eating and Drinking

    Went to the Alicia Keys concert in town with my buddy and blogger BK Diva.
It was so much fun! We ate dinner at Rosa Mexicano (where I had this funky and fantastic pineapple and cinnamon cocktail), chatted, chilled and looked fabulous. We missed Jordin Sparks (which disappointed neither of us), we saw NeYo, whose songs I like, but whose performance was ho hum.
    Then Ms. Keys, who impressed me! First of all, I didn't think she could move from behind the piano, but she proved me wrong on that. She did up her hits big and did justice to her more intimate pieces on the piano. I was a satisfied customer.

    Friday night's damage: $97.83, including $15 on parking, which sucks, but it also includes a cool apricot cocktail I had after the concert. Lovely evening.

    Saturday, my guy went to catch up with some buddies for the day and I went to run errands. Saturday errands always seem to cost a fortune. You can spend hundreds of dollars in no time.
    First, I went to get  an oil change. Sat at the Jiffy Lube for over an hour (because everyone else in Christendom decided to get their oil changed at the same time) but I was on the phone catching up with my girl on the West Coast so it was ok.
    Then, I went window shopping, then trying-on-clothes shopping, then buying-clothes shopping. I got some much needed khaki slacks, then much lesser needed tops (I had a $25 off coupon at Banana Republic, but, still).
Spent $10 on parking that day, which SUCKS.
    Then I met up with some old co-worker buddies from Virginia who moved up to D.C. It was great! We had dinner at an Ethiopian place (and one of my buds paid for dinner for all of us! Sweet!) then dessert and cocktails at live music lounge, just talking and cracking jokes. Lovely.

    Saturday's damage: $224.87. YIKES! The oil change was a little over $60 and then I spent over $100 on clothes.

    Still under budget on all the categories involved here, but I might want to keep the $300 weekends to a minimum!

    DH

Father's Day E-cards: Tacky or Touching?

    I bought cards for various men yesterday, all fathers and all important figures in my life. I bought cards for my cousin, my cousin-in-law, my uncle, my father (who wasn't there when I grew up) and a man who's been like a father to me and very generous toward me and my family.
    I spent considerable time picking out cards that suited each of their personalities and that conveyed my own feelings appropriately. I chose humorous cards where appropriate, I chose religious-toned cards where appropriate -- you get the idea.
    I thought about each one. It took a while.

    The thing is, I hate buying cards.

    What a waste of money! People read them and then have little choice but to toss them. And these things ain't cheap. Unless you get the 99 cent cards (which there were none in the store I visited), I've never seen a decent card for under $3.00.
    One of these men, I sent him an e-card. Why? Because as I was addressing them to send this morning, I realized that I didn't have the right address for him. The one I had in my book was old and I didn't have time to hunt him down and get the right one in time to send the card so it would actually arrive before Father's Day (he travels out of the country a lot).
    So I sent an e-card (with an apology at the end of my sentimental note).

    But then, I thought, why didn't I just send them all e-cards? It's free and there's nothing to throw away. They get a cute note, they know I am thinking of them, I can write a personalized note and when they're done with the warm and fuzzies, they press delete and that's ok.
    So, what wrong with an e-card?

    Nothing... or everything? I felt bad that I sent him an e-card when everyone else will get a paper card, even though they're all destined for the trash -- literally or virtually.
    My fear is that e-cards, though convenient, are still, well, tacky. I send them to my friends for their birthdays. (Most of them are lucky if I even remember their birthdays, so they shouldn't expect cards or gifts.) Besides, with my friends, I can send a silly, interactive card to distract them for a few minutes at work, they delete them and move on. That's fine with me.

    But I know I could never send the mothers in my life e-cards. It would seem so crass and lazy. I even sent paper cards to two of my friends, who are also moms, because I was thinking of them and thought it would be a sweet gesture. And I found some really good ones for them too!

    Anyway, what do you all think about e-cards? And about gifts for not really real holidays in general? I mean, Mother's Day and Father's Day are great, but they're really just designed to get people to go shopping. If we express our love and appreciation for these folks like we're supposed to, then it shouldn't matter if we don't get them anything on these designated days, right?
    Or not? I know my guy "doesn't do" Valentine's Day. I know this. I also despise the commercial premise of the day. Yet, every year without fail, I'm secretly disappointed when he doesn't get me anything, take me anywhere or wish me Happy Valentine's Day. Silly, isn't it? Or is it?

    Talk to me!

    DH

Days Away From DEBT FREEDOM

    This week, my last car payment will go to the lien holder.

    After this week, I will officially own my car.

    After this week, I will have NO MORE debt repayment payments to make anymore.

    I called the lien holder to let them know I was paying off the car this month (because of the foolishness that my bank tried to pull when I paid off my card, but then they were still trying to get $5 outta me for finance charges).
    The payment has to go to a different address and be labeled PAYOFF DEPARTMENT. I had set up automatic recurring payments with my bank for the car note back in 2004, so I called the bank, rather than fuss with it online. I don't want any mishaps.

    The bank will still sent the money via electronic transfer, but I just wanted every i dotted and every t crossed.

    And that, ladies and gentlemen, will be the last of my debt!

    Now, in the interest of full disclosure, technically,  I won't be completely debt free. I still have a school loan that is about $3,600 right now, but, as I've mentioned in previous posts, a close friend of my family has insisted on paying that off as he did for my brother's school loans.
    So, I will still have that debt, but I won't be making any payments (unless, God forbid, he changes his mind!).

    I am so excited!

    DH