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finances

Budget, Family Finances

Can You Be Both Spontaneous and Frugal?

July 20, 2015
Can you be both spontaneous and frugal?

I rarely spend money without first planning for it. Having been on such a tight budget for so long means that I usually have to pry my wallet open. I don’t go shopping unless I need something in particular, and I hate when unexpected expenses pop up.

Even grocery shopping entails about 30 minutes of clipping coupons and writing a list of items by department. Saving $20 at the grocery store could be the difference between being able to pay the utility bill on time or facing over-draft charges. Every purchase for our home is usually calculated, literally and figuratively, into our finances, because we don’t have much wiggle room in our budget for error.

A bunch of home-bodies

What this boils down to is that, as a family, we aren’t very spontaneous. Both because of our tight budget and my husband’s erratic work schedule, we don’t just pick up and travel on a whim. We’re very much home-bodies who would rather rent a red-box movie than go to the theater. Most of our day off activities are free or really inexpensive and planned in advance. Now that I have kids, I have a tendency to equate spontaneity with wasted money and poor financial choices.

Ditching the deliberate and dull 

As newlyweds we did a fair bit of spontaneous travel and made impulsive purchases. While not always the most responsible, spontaneous use of our money was fun. Spontaneity keeps life interesting and fresh. Being willing to jump up at a moment’s notice and take off helps rub the sheen back into a dull life. Until last night, we hadn’t done anything spontaneous in a painfully long time.

Last night we had finished the post-dinner routine, and the kids were watching a cartoon. Since I had a free minute, and inspired by an article by Carrie of Careful Cents to create a productive work space, I got on Craigslist to see if I could find an inexpensive desk or entry table that I could buy to use as my own work space. We have a desk in our office, but my husband’s desktop computer takes up the whole surface, and it’s in the den where the kids tend to spend quite a bit of their time. I have a hard time getting work done in that room while the kids are awake.

After only about 10 minutes of different search terms, I found a beautiful, solid wood desk, with the exact dimensions I needed, listed for only $25. At 7:30 last night I called the sellers to see if the desk was still available. It was, but they were selling it out of Richmond, and they were moving so they needed it gone immediately. She sent me the address, and I told her that we would be there by 9:30.

Spontaneous frugality

So, instead of quiet, lazy bedtime routine, we quickly got our kids in their jammies, brushed their teeth, and piled everyone in the van for a three hour round trip to Richmond and back. Since it was his bedtime anyway, our son fell asleep before we even reached the highway. Our daughter chatted our ears off from the back seat the whole way to Richmond. Getting in the car that late, with no prior notice, was like a shot of adrenaline for her. She was so excited to watch the sunset come down over the trees and watch the deer grazing the edge of the tree line. We danced to music, talked, and enjoyed this spontaneous adventure as a family.

Our daughter fell asleep after we had gotten the desk, so my husband and I had a solid hour and a half ride home uninterrupted by kids, phones, computers, or the television. For $25 for the desk and $20 in gas, round-trip, I have a beautiful, solid wood desk and a fun memory of that time we allowed ourselves to be spontaneous again.

My new  work space

My new work space

Being spontaneous can save you money 

Sometimes you can still be frugal while also being a bit spontaneous. Not only did life unexpectedly give me the opportunity to save some money, but going for a late night trip to pick up a desk off of Craigslist was like a breath of fresh air for the whole family. The experience put a pep in my step, I don’t have quite as bad of a case of the “Mondays” today, and I have a beautiful desk to organize as my own work space.

Do you ever allow yourself to break away from routine? Do you think that you can be both frugal and spontaneous?

Family Finances

Financial goals Road Map

June 15, 2015
5 steps to securing your financial future

 

I used to have concrete goals in place of who I was and where I wanted to go in life. I have really lost my focus in the midst of staying home with my kids, dealing with repeat miscarriages, and barely escaping serious financial trouble. The past 3 years have been more about survival. My only thoughts have been about making it to the next day and finding a way to pay the next bill. I am done with only living on survival mode and only meeting short-term goals. I want to thrive, and I plan on making and meeting big financial goals for my future and the future of my family.

Before sitting down for a finance date with my husband to look at hard numbers, I only had a general idea of what my financial goals were for the future. My only real goal was to be living debt free. Outside of that, it was a big blank question mark. I have dreams about the type of home we will live in someday, but the day-to-day is a fog. Both financially and as a person, where do I seriously see myself in one year? Five years? 20 years?

Without concrete life goals in place, how will you ever reach your financial goals? You won’t, unless you spend a great deal of time and effort thinking about, planning for, and acting on the steps that a goal requires to achieve. These are my 5 steps to help map out my financial future and bring my priorities into focus.

5 Steps to mapping out your Financial Future

Step 1: Write down your extended yearly goals

By writing out an extended financial plan for yourself and your family, you will have a clear road map for actually achieving those goals. Make a list of where you expect to be in one year. How much will you have saved in 5 years? Where do you see yourself in 20  years?

Step 2: Make your budget reflect your financial goals

Saying “I want to save $20,000 in 5 years” is a great goal, but unless you have formed your budget around those goals, they will never happen. You need to make sure that you have a plan in place for where that $20,000 is going to come from. Are you going to cut expenses or get a part-time job? Neither? Both? How are you going to achieve your goals?

Step 3: Live your life honestly

In every step of the process, be true to yourself. Don’t become so single-minded in reaching your financial goals that you lose sight of everything else. Make sure to budget both time and money for pursuing your other dreams and interests. You won’t stay on track with your financial goals if you don’t give yourself time to do those things that bring you joy and fulfillment.

Step 4: Find a financial accountability partner

Entrust your goals to someone who will help you stay on track. Whether it’s your spouse, family member, best friend, or mentor, make sure you have someone to call you out when you diverge from your financial road map. It’s helpful to have someone to talk to openly and honestly. It will help relieve stress when you feel like you can’t do it anymore, and they can give you the motivation you need to stay on track.

Step 5: Getting started

Don’t wait until Sunday, or the next pay check, or until you have paid off your credit card. Stop forming excuses and pushing back your start date and get started today. The time will pass anyway, so don’t let the fear of failing prevent you from ever trying to achieve your financial goals. There is no better day than today to start securing your financial future.

My own long-term goals

My goal for this week is to sit down for another finance date and create a road map for where we see ourselves in the next 20 years, how we will get there, and what our budget will be to reflect those goals. I am tired of just surviving. I want to thrive! I want to live in a way that we have to face only minimal financial obstacles. I’m ready to get started on mapping out my financial future.

What are your long-term financial goals? Do you have a financial road map for your future?

Budget, Family Finances

Breaking the Chains of Debt

June 9, 2015
Breaking the Chains of Debt

 

Due to a bureaucratic snafu with Veterans Affairs, we had a pretty dark financial period in our life a few years back. After my husband got out of the Navy to pursue his Bachelor of Science degree, he used his GI Bill benefits to pay for his school tuition as well as our mortgage payment. He was working full-time and going to school full-time, but, without the GI bill stipend, we didn’t have enough money to cover the bills.

An important piece of paperwork, essential to receiving the benefits, got lost repeatedly within the great void that is Veterans Affairs. Because of this low-level error, we were left facing an 8 month period where we didn’t have enough money to pay the bills. It was either pay our bills, pay for gas to get to work, and pay for food on the table, or pay our mortgage payment. During this incredibly trying time, we weren’t even living paycheck to paycheck. We were living on borrowed money. We had to put our groceries on the 15.99% interest rate credit card just to feed our family.

It was a humbling, embarrassing, eye-opening eight months of asking friends and family for help, eating mainly from our garden and WIC checks, and wondering if the next month would be the month where we faced foreclosure and homelessness. Needless to say, at the end of the ordeal (when the VA finally fixed the issue) we had accrued even more debt on our credit cards than we had before the VA debacle.

Today, we are in a much better place financially, but we are still struggling to pay off debt from the credit card, our car loan, and a personal loan used to fix my husband’s daily driver vehicle at the time. During our first finance date last Friday night, my husband and I had a considerable discussion about our debt. Mainly, we discussed ways to limit our spending, increase our income, and put the difference towards the $16,172 we have in the red (not including our mortgage).

I have been reading several different personal finance blogs lately, and a common tool utilized in the personal finance community is to have a debt visual in your home that keeps you motivated towards your goal of paying down your debts. Some people like to use a picture like a thermometer to fill in as they pay down their debts. Others may use pennies on a scaleI love both of those ideas, but I wanted to have something pretty striking as a visual aid. I wanted to have something that would be a topic of conversation if someone came to our home.

Since our financial and personal freedom is so tightly bound by our debts, we decided to go with cliché but highly effective paper chains. Each link of our debt chain represents $100. The red links represent our car loan, the black links represent our credit card, and the brown links represent our personal loan. At the end of each month, we will look at the principle paid down on each debt and remove the links one at a time. We are hoping to have every last link of the chains removed in two years or less.

IMG_8470

We are going to be making a lot of sacrifices, earning money through side-hustling, and putting every spare penny we have towards removing those awful chains from our den. We didn’t notice it at first, but we have a little sign sitting on the window sill that says, “Every day is another opportunity to change your life.” We felt it was a very fitting place for our debt visual.

We hate seeing so much of our income going towards credit debt and loans every month. We want to be able to save our money for emergencies, retirement, paying college tuition, and traveling. We want to be free to live our life on our terms again. The next few years are going to be a lot of hard work, but we are so excited to get started on this next chapter of our lives together. We want these chains of debt to break free one day at a time so we really can change our life. 

Are you facing considerable debt?

Would you consider placing a visual in your home to help you pay down those debts?

Budget, Family Finances, Police wife life

Financial Emergency Planning and our First Ever Finance Date

June 8, 2015
Finance date night

At the start of our marriage, my husband always took care of our finances. It made sense because he had more experience than I did with tracking money and managing bills. I had just graduated from college, but he had been living on his own and managing his money for four years working in the Navy. After our kids were born, I actually preferred that he take care of the finances, because taking care of the kids all day is exhausting, and my mind would turn to mush if I were confronted with accounting numbers.

I have no trouble at all living frugally, cutting the excess from our spending, and trying to live within our means. When it comes to hard numbers though, up until this past Friday night, I was completely lost. I was completely ignorant of the bills, how any of them were paid, and I didn’t have the login and password information for any of our accounts. Especially since my husband works a high risk job, this put our family and our future in jeopardy. Should anything happen to him now, on his job as a police officer or Navy reservist, I would be completely in the dark as to how to go about managing our finances.

Receiving daily advice from personal finance blogs has really helped get me motivated to organize our finances and save for the future. I realized that we have an alarm system on the house and a fire extinguisher in the kitchen. We have car, home, and renters insurance. We have all of these safeguards in place to protect our belongings and our assets, but we didn’t have any protection or emergency plan in place for our finances. For the past few months, I have really been pushing for us to sit down and hash out the numbers. I wanted to have a plan in place, not only for if an emergency should arise, but also so that I could become more involved in the daily maintenance of our money.

So, this past Friday night, my husband and I snuggled on the couch with a legal pad and laptop. We had our first ever finance date for creating a concrete budget and having all of our account information compiled in one place. It was everything I imagined it to be and more. Just kidding…sort of. Creating a contingency plan for if your spouse should be killed is not exactly the epitome of romance. However, going over the numbers that represent our life and how we feed, clothe, and house our family was a new sort of intimacy that we had never experienced together. Albeit serious and at times painstakingly dull, it was a date which required eye contact, real communication, and compromises being met. If you have never had a finance date, I highly recommend it. It brought us closer together, and it gave us the tools we need should we ever have to deal with an emergency.

After our finance date, I felt so much better. I don’t like having to think about something terrible happening to my spouse, but it’s a relief knowing that I now have all of our account information to deal with the finances if I have to. After our date, my husband told me that he felt like a huge burden had been lifted from his shoulders. Since he was no longer the only one dealing with the stress of our finances, he could breathe a little bit easier.

I honestly have no idea why we waited so long to sit down together and talk about our finances. It was such a huge relief to us both. We decided that, from now on, we are both going to manage our accounts together, and we are going to work towards meeting our financial goals together. We plan on having monthly finance dates from now on. We both slept well Friday night knowing that, financially, I would be alright if anything were to happen to him in the line of duty.

Do you and your spouse have monthly finance dates?

Do you have the account information you would need in case of an emergency?