Mystery Money

This has happened to me a couple times in the past few months. I've set my budget, predicted what amount my paychecks will be, have it set in my mind what is coming in and going out. Then I get up in the morning, log on to the bank's website, and look up my account balance, only to find that there is more money in there than expected. Click on the account to see the transaction history, and notice there has been a deposit made that I had no idea of. This morning it was $25 from Zions Bank Payroll. Odd, seeing as how payday isn't for another week, and I have no idea what the $25 is for. Its a good thing too, as my mom paid for me to get my nails done a few weeks ago, and I am now needing a fill, and its going to cost exactly $25.

Last time this happened, I woke up to see an extra $2000 in my account. I was shocked. On the transaction history it said it was from ORS, and it was a child support payment, I called ORS to make sure that they hadn't made any mistakes, and found out that it was a back child support payment that they had collected a couple months ago that they were finally able to release. It was definitely a blessing as I was able to get caught up on bills, and put some money aside into savings.

Savings

A savings account is just smart. Saving for a rainy day, because it is going to rain. Something is going to come up, and you are going to need extra money. Lately it seems that many people are not saving, not preparing for those days when the car is going to need repairs, or something else comes up that needs money. Many are using credit cards for those emergencies, which only puts them further into debt.

Right now, the bulk of my savings is in ING Direct, they have a pretty good interest rate, and offer easy transfers.

There are many online banks that offer good rates and are FDIC insured. AmTrust has the best interest rate so far, I am contemplating moving my savings to them. Although I have been with ING for a long time, so I may stay with them, unless their rates go down farther.

Happy Thanksgiving!

I love Thanksgiving. The food, the family, the get togethers. But the best thing about Thanksgiving is that it signals that my favorite holiday is around the corner. Christmas. I love everything about the holiday, presents, decorations, movies, the music. Especially the music!

Christmas also seems to be a holiday that many people go into debt for, and are paying in January and February the bills for Christmas. The bank I work at has noticed this trend and has added a wonderful tool to their website. Its a holiday budget. Zions Bank Holiday Gift Planner is a free service offered by the bank to help you budget for the holidays. Remember to include all holiday spending, including travel, food, wrapping paper, decorations, etc.

This year I'm in a much better place to provide a fun Christmas for my little family. But I don't want to go overboard, so this budget will help me stay on track. I've already purchased our big family gift, I just need to get smaller presents. And I also want to add a few things to my collection of Christmas decorations.

Happy Thanksgiving everyone and happy holiday shopping!

Budgeting.....revisited

How did my budget go this month? Great! I think. As I have worked on following the budget, and tracking my spending, I have noticed one amazing and wonderful perk...my bank account balance has not come close to going below $100. If anyone knows me, you know that is an amazing feat. Just a couple months ago, I was going into the negative every month, hoping that a paycheck would go through before everything hit my account and bounced. And usually every month, for about 2 or 3 days before payday, my account was in the negative.

Here is what has really helped me. I always have two programs running on my computer, at all times. My internet browser, with one tab always dedicated to the bank's website, and my finance software, Ace Money Lite In the finance program, I have scheduled all of my bills, indicating which are paid every month and on what days, and also scheduled each paycheck, with an estimated amount. This gives me the option of viewing my finances 2 months ahead of schedule, having the bills scheduled let's me get all of the necessary expenses budgeted, and all I have to do is look at the ledger to decide what needs to be paid. So this is what it looks like today, starting with the paycheck, and then listing what bills will be paid with it, and then a running total balance. (and it looks much neater in the software program than it does on this page)

11/16/2007 Cristina Gerrard Wages and Salary:Net Pay 446.90 448.72
11/16/2007 Questar Gas Bills:Natural Gas 57.00 391.72
11/16/2007 Monticello 3rd Ward Donations:Tithing 45.00 346.72
11/16/2007 Grocery Cash Envelope Food:Groceries 80.00 266.72
11/16/2007 Gas Cash Envelope Automobile:Gasoline 20.00 246.72
11/16/2007 Emergency Savings Savings 100.00 146.72
11/16/2007 Devon's Repair Service Automobile:Maintenance 100.00 46.72

I love finance software, and since I can't quite justify paying $60 for one of the larger programs that can track more than just day to day spending, I'll use this handy free one until I need to track more accounts, like retirement and taxes, and investments. I've also found that just being able to track my regular checking account with this program, and not knowing what is in the savings account means that I just keep adding money to the savings account without being tempted to take it out to cover trivial expenses.

Remember they call it personal finance for a reason, its personal. What works for me, may not work for everyone, but I hope it can be a good place to start, sometimes we need another's example to inspire us.

Cars, cars, cars

Cars. Status symbols? Containers to get you from point A to point B? Debt mongers. hmm.

The other day, a mechanic who worked on my car once, came into the bank. He asked how my car was running, I said its running great. He mentioned how much work had been done on it, and I agree it had a lot of things that needed to be replaced. And here's the kicker, he asked why I didn't get a new car, and since I work in a bank, I should be able to get a loan. Well, lets think about that for a second:

Current situation: 1984 Mercedes-Benz 300d Turbo

Purchased for $2300
Replaced:Battery $100
Replaced: Alternator $200
Replaced: Radiator $350
(changed mechanics)
Replaced: Water pump $200
Replaced: Alternator: Under warranty: $84
Oil change: $30 every six months
Insurance: $200 every six months

Total put into my used beater of a car in the year I've had her: $3694
I'm editing this post to add that according to The NADA guides on classic cars, my car is worth on the LOW end $4875. Not too bad. On the high end its $9750. So, in this instance, my net worth has gone up.

Hmm, now where would I be if I decided to buy a new car?

I'm going to guess that the new car is going to cost $12000
Assuming a 10% interest rate since my credit is crappy and a 72 month term. My monthly payment would be $222. Not too bad, I could probably afford that much a month, but in the end that brand new car in just loans is costing me $16006. And new cars are going to need to be maintained also. Oil changes, routine maintenance, not to mention that that car that is costing me $16006, is only worth about 9000 once I drive it off the lot. Ah, and insurance is going to go up on that shiny new car, I'll have to pay for full coverage. I'm estimating it will cost about $600 every six months to insure the new car.

So do I keep my used car and just keep up with the maintenance? Or do I sell it and go into debt for a new shiny car?

Payday...sigh

Today is payday, yay!! But as with all other paychecks, this one has been spent. I can check these off my budget for this month:

Phone/Internet/Satellite: Paid!
Devon's Repair: Paid!
Savings: Paid!

I will also use money from this check to put gas in my car. I had budgeted $30 for this check, but after looking over last month's gas usage, I think I am going to have to raise it to $50.

This is a short post, but I'm off to work! Time to make more money.

I declare WAR!!!

I declare a personal war on debt! I refuse to be a slave to it any longer! I will never purchase on credit again! I will repay all of my debts and no longer have those hanging over my head.

My debts from smallest to largest:

BMG $47.55 PAID!
Tricore $74
APS $170 PAID!
MEDCLR $211
BRS $204
Devon's $400
United Educators $1500
ACS $1795
Sallie Mae $2615
Mountainland $2760
Sallie Mae $4149
Kia $10,775

I have budgeted $140 to pay debt payments, for November I will pay Tricore off, and pay $66 to Medclr. I have also budgeted $50 for ACS and $50 for Devon's.

In December that gives me $140 again, $100 to Medclr, the rest to BRS. Along with the already budgeted $50 for ACS and $50 for Devon's.

Having a plan really helps! I envision throwing "snowballs" of money at each of those debts, my own snowball war! It will be a blast to watch those debts shrink.

Saving Money

The easiest place to find extra money for savings/debt payments, is the grocery budget. A good rule of thumb is $100 per person per month. That can be a little daunting but it can be done. And sometimes it can be done for less!

One of my favorite websites for saving money on food is The Hillbilly Housewife. There are some wonderful home cooked recipes on there and a good plan for stretching that dollar when it comes to food. When I first found that site, the first thing I did was make the easy bread recipe. And it was easy! I had always been afraid to bake bread without my trusty bread maker, but there really isn't some secret to making a good loaf of bread. And its not messy! Sure the dough starts out sticky, but if you have the right ratio of dry to wet ingredients, its not so sticky, and then kneading is fun! And a good workout for your arms. And the smell while its baking, and the taste when its done make it all worth it.

Another way to stretch that dollar is Bulk Cooking. Basically cooking in advance. An easy example is Ground Beef. Shell out the extra couple of dollars and get the big bulk package, the family size that has like 5 pounds in it. When you get home, cook ALL of it with some onions, and some garlic. Let it cool, slightly (some will say completely, I just don't have the time) Divide it into 1 pound, about 2 cups each, portions, package in good quality freezer bags that you've prelabeled. Use 1 pound with dinner tonight, either spaghetti, or tacos. And there you have 4 pounds of pre cooked, pre-packaged ground beef, now when ever you want to have tacos, spaghetti, beef soup, etc, all you have to do is pull out the meat, defrost and bring to temperature! There are some great websites that have all sorts of plans for any kind of meat or vegetable that you would like to prepare in advance. Bulk Cooking has some great plans, and some really good beginner steps, and we all like those steps right?

And for those of us who's schedules are too busy to sit down and plan a menu, there is Menus 4 Moms, a site that emails you 5 meals a week, complete with recipes, shopping lists, and instructions!

Coupons are a great resource too, but they are tricky, the idea is to pair a coupon with a sale. And that can take some time. I you have the time, its great! But, if not, I would fully suggest The Grocery Game. I did it for a year, and I loved it. I now live in a very rural area and doing The Grocery Game is just not an option for me anymore.

Budget

Do you have a budget? Do you coast along hoping there is enough money to cover all your expenses for the month? At the end of the month do you wonder where on earth all the money went? I love budgets, and while I don't always follow them to every last cent, having a basic budget really helps me prioritize expenses.

Dave suggests having the "four walls" taken care of before anything else. These are your needs. You need a house to live in, you need food to eat, you need lights and heat, and you need gas to get to work. So the first part of my budget looks like this:

Rent $400
Food $250* (using the rule of thumb $100 per person, with some cutbacks since my kids are small) This also includes toiletries.
Utilities
Natural Gas $57
Phone/Cable/Internet $160
Gas $100*
Total $967

So now I have my four walls covered, I can live, work, and eat. Now I can focus on other parts of my budget. I of course figure in tithing, 10% of my income, which roughly works out to $150 a month.

Total $1117

Next important expense is daycare, and I average about $200 a month in daycare costs. So now we go to not so necessary expenses. I have to pay daycare since I need to work to make money. But after the 4 walls are covered, and daycare is paid, if I don't have the money, the items under those are put on the back burner.

Daycare $200*
Debt payments $140
Netflix $5.33

Grand Total $1462

I don't always make enough to meet all my expenses, but now that I have my emergency fund in place, its not as stressful. I like having the cushion the EF provides. My income looks something like this:

Child Support $767 (this is a fixed amount, so there is no estimating on this one)
Wages $800 (Varies)
Total $1567

So according to this budget, I should have about $100 left each month, this won't always be true as I don't always make that much money. But this basic budget gives me an idea of where my money needs to be going and how much.

The items in the budget that have an asterisk* near them, indicate items that Dave recommends using Cash Envelopes for. I figured I could still just use my debit card, but I've noticed that I overspend those categories by a few cents, a couple dollars here and there. So next month, I will be switching to cash, using the envelope system. I purchased Dave's deluxe envelope system, and so far I am impressed.

I encourage all of you to write down a basic budget. Dave Ramsey's site has some wonderful basic budget forms, along with other wonderful forms for financial planning.

The steps

Here we go. All journeys need a plan. And we start one step at a time. I'm using Dave Ramsey's 7 Baby Steps.

Baby Step 1: Have $1000 in an Emergency Fund.
So far so good. I have $850.

Baby Step 2: Payoff all Debt using the Snowball Method
Just starting on this. But I did get two things paid off! Yay me!!

Baby Step 3: Have 3-6 months of living expenses in Savings. A FULLY funded Emergency Fund.
My goal: $6000

Baby Step 4: Retirement investing

Baby Step 5: College Funding

Baby Step 6: Pay off Home Early

Baby Step 7: Build Wealth and Give!

These can be all found at Dave Ramsey's website www.daveramsey.com

Debt Free

Debt free. What a concept. What a goal. Am I crazy? I don't think so. I've dreamed of being debt free since I was in college and received my first credit card. What a joke, my first credit card, and I didn't even have a job to pay it off. That credit card was paid off long ago thanks to tax refunds. But as I've lived and grown, so my debts seem to have grown. I have medical co-pays that got pushed aside, a set of books that I probably paid too much for, but they had sentimental value, I actually don't mind this debt, but look forward to paying it off. And of course like every other American citizen, I have student loans. Luckily mine aren't as high as they could be, but they are still there.

A couple years ago I found Dave Ramsey. I was in love. A financial guru who wasn't advocating the get rich scheme. Who was pushing hard work and savings and above all Debt Free to get ahead in this life. I printed out the baby steps. I set a goal. I tried very had to get my then DH on board, and he agreed with the concepts but when it came to actually applying them, we both struggled. The baby steps got pushed aside, as we had 3 children. I had forgotten about Dave, although he was always there in the back of my mind.

Now its years later, not many, maybe 3, and I'm divorced, a single mom with 3 kids. I started working, my first job since my oldest child was born. Its also the first job that I actually, absolutely love. I work at a bank, and an email was sent out company wide about a Super Savers Class, so I requested more information, got the website www.daveramsey.com and as I was browsing, thought, this seems familiar. But didn't think much more of it. I printed out the free forms he has on his website and got to work. Wrote out a budget, listed what debts I knew I had, and then requested my annual credit report from www.annualcreditreport.com to refresh my memory as to what other debts I owe.

That was 2 months ago. Now I have $850 in savings, (had to dip into it this month) that will be built back up to the $1000 BEF. (Baby Emergency Fund) I've started paying on my outstanding debts. And I have a subscription to www.mytotalmoneymakeover.com Today I just finished reading "The Total Money Makeover" and I have hope, I will be out of debt in a couple years, I will be able to save enough money that my kids won't have to take loans out for school.

I'll be blogging about my progress through the 7 baby steps. Which I will list in the next post.