Money, Love, and Change

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We all know about some of the ways to save on our energy costs - having good windows, sealing up leaks, insulation, etc.  But once that is all said and done, how can we save money on our actual bill?

Until now, we haven’t worried too much about our natural gas bill.  We do what we can to save on heating costs, and have enrolled in our provider’s budget plan to make life easier.  The budget plan is really nice - you pay a fixed amount 11/12 months out of the year, and then pay the remaining balance on the 12th month.  We’ve been pretty happy - our monthly bill is about $95, and our remaining balance last month was less than $50.

We got our updated budget plan today, and were a little surprised.  We expected an increase, but were taken aback by a new amount of $150.  This increase is due to the expected rise in energy costs this winter.  Wow!

After looking at our provider’s website, I found that we have the option to choose our natural gas supplier, and that some of them offer fixed rate plans.  One supplier had a fixed rate plan for this year that was already 0.13 cheaper/ccf than our current rate, and it would be locked for one year.

I know that this isn’t going to add up to a lot of money if the rates stay where they are, but it is reasonable to expect that rates are going to steadily rise as winter approaches. I’m thinking that it might be a good idea to lock in a rate now.

Do you have a fixed rate plan for natural gas?  If so, I would love to hear about your experience!

It was an interesting weekend, to say the least…

On Friday evening, our tv and light started turning on and off on their own, as if possessed.  Upon investigation, we found that a switch that is used to turn on that particular outlet was extremely hot and making popping noises.  This didn’t seem good.  After cutting the circuit and letting things cool down,  we took the switch out of the wall.  It looked like it was from 1950 (when the house was built) and smelled awful.  Ironically, we smelled this earlier in the week, but thought it was the computer that had just died.

After avoiding an electrical fire on Friday, we hit the road early Saturday morning to look for a new computer (and stop at Lowe’s for a new switch).  We carried the cell phone with us, since we were hoping to pick up my husband’s truck on the way back - it was in the shop for an oil change and to have the brakes looked at (it started shimmying when going down hills this week, so we wanted to have it checked on right away).

On the way to the store, we got a call about the truck.  I knew the news could not be that good, as my husband used words such as “Really?”, “Wow”, and “Sure, Monday would be fine…” when he was on the phone with the mechanic.

“So, what’s the damage?”  I asked, after he got off the phone.

Basically, the tie rods were about to come off - the mechanic said he was surprised that my husband had not been in an accident - they were that bad.  We were also going to need new rotors, as the old ones had been machined a couple of times already.  Coupled with the annual inspection and emission test, along with a radiator flush, I knew things weren’t looking too sunny. The price tag?  Close to $1000.

My husband cringed as he broke the news - I think he was waiting for the four-letter words to start flowing, which is rare now that we have a kid.  But in old times this situation might have warranted at least a couple of them.

I kept silent for a minute, and then asked him if he thought they would let me use my $30 off $300 coupon.  We both burst out laughing.  Even the kid started laughing from his car seat, as if the idea was hilarious.

The way I see it (and my husband agrees), we are very lucky.  Our house didn’t burn down, and I much rather pay $1000 in car repair bills than have a husband in a car wreck.  We’re thankful that we have the emergency fund - a couple of years ago, this would have been a pretty big financial hurdle.  Now it’s just a bump in the road.

We’ll still put the bill on the credit card (to get the rewards), but will pay it off in the same day.  Needless to say, we’re going to put off purchasing another computer for a couple of weeks (at the very least).  I know that we still have a lot of debt, and are not close to true financial freedom yet, but it’s so nice to be able to laugh at things like this and easily see the bigger picture.

What about you?  Could you laugh this off?  Or would it have been a string of expletives?

If you’re looking for a free tool to help you at your first attempt at making a budget, I would recommend taking some time to check out The Money Case.  After taking a couple of minutes to put your initial information in, you are given a breakdown of your budget by percentages.  After taking the time to input your actual expenditures, you are able to compare them to your budget.  Good stuff!

This software is very visual, with graphs that make it easy to see where your money is going.  I currently use Microsoft Money, and most of the time the graphs aren’t accurate - this software does a better job.

If I could change anything about this program, I would like the ability to enter monthly income (as opposed to yearly).  Although my husband’s salary remains constant throughout the year, mine changes monthly.  Therefore, the accuracy of the percentages is off for our budget.

I would highly recommend this program for anyone just starting out with a budget, as well as anyone considering going from a double income family to a single income family.  Being able to look at percentages can really help one to see where extraneous expenses can be cut, and whether or not it is realistic to be able to afford to live on one income.

Within the past couple of weeks, we encountered 2 financial bumps in the road totaling $600.  This surely isn’t pocket change, and until tutoring starts up again, we really don’t have a lot of extra money.  However, I am going to try to come up with $600 without dipping into our emergency fund or vacation fund.  Here’s what happened:

1.  New car tires - We weren’t really expecting this one, but when we got the car emissions and inspection done, we were told that new tires were in order pretty soon.  We trust our auto mechanic - they have done a great job so far letting us know about upcoming maintenance ahead of time (ie.  belt changes, tire changes, etc.).  To date, we’ve been able to set the money aside ahead of time and then have it done at the next oil change.  Our total bill was a little over $300 (includes our annual inspection and emissions tests).  Usually, we just take the money out of our emergency fund and replenish it, but I would like to try to pay this without touching our emergency stash.

2.  Car rental for trip to Arizona in November - We’re going to Arizona in November to visit our good friends.  The flight is booked and paid for, but we have been discussing renting a minivan and splitting the cost 50/50 with our friends.  We plan on visiting Phoenix, Sedona, and the Grand Canyon - with 2 kids in car seats and 4 adults, getting a larger vehicle to save on gas (as opposed to driving 2 separate vehicles, 1 of which would still need to be rented) seems like a good idea.

My friend called me last week with a great deal on a minivan for the entire week from hotwire.com.  Our friends will pick it up and drop it off, and the cost was about $200 cheaper than what we had previously found.  I booked it - the total was $295, and I’ll be getting back $15 for using my Discover Card.  Our friends will be paying us their half ($140), but they are tight on money right now since they just got back from traveling themselves.  They are good for the money, but I want to pay the total amount off without dipping into the vacation fund.

I’ll be keeping track of snowflakes throughout the month.  So far, I should be getting $50 from RevResponse, and $25 from my credit union because I signed up for paperless statements.  I’ve got some other tricks up my sleeve for this month as well.

Do you have any small financial goals this month?  Do you think that I can do it?

We’ve been putting aside $25 a month for Christmas.  I know that this doesn’t sound like a lot, but keep the following things in mind:

1.  My husband and I don’t buy each other gifts for Christmas.  Seriously.  If one of us wants or needs something, we discuss it and then plan appropriately.  Besides, with the birth of our son, we both get more joy watching him open presents.

2.  We don’t spend a lot on family.  In the past few years, we have sent framed pictures or photo books as gifts using gift certificates and other discounts.  I plan on using Boomertowne gift cards for family this year as well.

3.  My son (who this fund is primarily for) doesn’t need a lot of toys.  Last year, we spent $150 (toys and clothes) and he had a wonderful Christmas.  We figure that a similar amount will be good for this year, especially if we shop ahead of time (which we didn’t do last year).

Today we went shopping to get my husband the new Guitar Hero game (free after gift cards).  On the way home, we stopped at Toys R Us - I had heard that they were having a sale on Brio trains.  I was wrong - they were actually having a clearance sale!

For $60, we got our son a new train set with track, 2 extra sets of track, 2 stations (a conductor station and a repair shop), and 2 additional train cars.  This is going to be his “big gift” this year.  I’m really excited that we were able to get such a great deal, and we know that the kid loves trains already (he has a smaller Brio set).

The only thing I haven’t gotten ready is a good hiding spot for this year’s gifts!

Do you like Christmas shopping early?  Why or why not?

OK, I am a sucker.  I wanted free access to my credit score, and when I got the offer from WaMu for a card that had free access to FICO scores, I signed up.

There were no balance transfer fees, so I did a small balance transfer from a higher interest (3.99%) credit card.  I planned to pay it off in full before incurring any interest charges.  I would get free access to my credit score, and everyone would be happy.

After a couple of weeks, I had not gotten my card, but the balance transfer had occurred (I knew this from checking the card the transfer had been from).  I called Customer Service, and asked where my card was.  After being treated like a two-year-old (I understood I  had done a balance transfer, but they wanted to keep explaining this to me), I was told that I couldn’t pay the card until I received mine in the mail.

It did come a couple of days later, and I paid off the balance in full, still a week ahead of the due date.  I checked my balance today, and guess what?  A finance charge had been assessed.

I called Customer Service, and was given the run-around yet again.  After explaining my situation to a supervisor, nothing was done, so I paid the finance charge (less than $3) and canceled the card.

Ironically, every time I tried to access my FICO score online, I got a message saying that the service was temporarily unavailable.

Have you experienced anything similar with a WaMu card?  Or was I an isolated incident?

I’m just going to say that I have a real problem with these projections.  Articles like this one at MSN try to put a salary tag on a stay-at-home mom.

Here’s my salary projection for the stay-at-home mom: Priceless.

Guess what?  I would also put the priceless tag on the stay-at-home dad, the working dad, and the working mom.  There is no way to place a dollar sign on the sacrifice every parent makes for their child (or children).

Whether we choose to stay-at-home or work, most parents are just trying to do what is best for their kids.   We are trying to balance making the most of today while trying to create a good future as well.

That’s all I have to say about that.  What do you think?

Our stimulus check arrived last week. I just transferred about $540 to our emergency fund to bring it up to $5000 again. This was our first Dave Ramsey goal that I talked about in a previous post.  So it’s not official yet (since technically the money isn’t in the account), but it’s in the process!

It feels great, but I will feel better about it once I have secured another part-time work-at-home job to bring in income over the summer (I currently tutor online, and the hours will be decreasing soon). I don’t want to have obtained our goal only to dip back into the emergency fund a couple of months later!

Next, I need to update our accounts to see what we can put towards our high-interest student loan.

What were your plans for your stimulus check? Did you follow through with your plans?

I know, I know.  Everyone is wondering where theirs is.  I can’t wait for ours to arrive - it is already allocated as follows:

$600 - brings savings back up to $5000.  Yippee!

$350 - gas for traveling to OH in 2 weeks, and then western NY over Memorial Day.  This is all to visit family.

$25 - donation to friend who is doing pancreatic cancer walk.  She lost her stepfather last year, and is such a sweet gal.

$35 - basketball shoes for the husband.  He just started playing again, and his old shoes were, well, really old.  After a couple of blood blisters, he admitted that new shoes would be nice.  I used our Discover Cash Back awards to get $75 in gift cards.  With a 15% online discount, they came to $33.  He has a tendency to roll his ankles, so I’m hoping the shoes will help us prevent a $75 co-pay to the ER.

$490 - ??

I know that we won’t be stimulating the economy with additional purchases - I will leave it in checking to pay down bills while I look for a job.  Once I have something lined up, I hope to use it against that student loan!

What are you planning to do with your check?

I recently finished Dave Ramsey’s Total Money Makeover, and it is a quick and easy read.  I would recommend getting it from your local library - I would not buy it just because there are enough blogs and information on his methods on the web (and you can use the cost of the book as your first snowflake!).  I think that Get Rich Slowly has a nice synopsis of the book here if you want to get the basic idea before investing your time reading the whole book.

Is Total Money Makeover going to change our lives?  I’m not sure.  We have been  working hard to pay down debt, and I am confident that we will eventually reach our goal of being debt-free.  However, this book made me realize that we need more of a concrete plan.  We tend to throw money towards debt in a haphazard manner, but I like the idea of having a psychological boost of seeing something get eliminated.  After talking it over with my husband, we’re going to create a modified version of his plan:

1.  Get our savings back up to $5,000 - Ramsey suggests a $1000 emergency cushion, but this just doesn’t sit well with us.  Maybe it has to do with my lack of dependable income, the recent upheaval we were in as my husband found another job (since his old one will be in China soon), or the fact that our little truck will have to give out someday.  We recently used a portion of the emergency fund to cover some unexpected car repairs, and it is sitting at roughly $4400.  We will both sleep easier at night when it is back up to $5000.

2.  Pay off that *$)!(@ private student loan  - it is not our smallest debt, but it is our highest interest debt (currently at 7.5%).  I hate it.  I don’t care that the interest is deductible.  Every time I log into this account, I cringe.  At roughly $3500, it needs to go.

After these two goals, we have a couple of others, but we are not sure what order they will go in yet:

3.   Max out our Roth IRA contributions - Although Ramsey suggests stopping 401(k) retirement contributions until debt is paid off (in most cases), I just can’t pass up free money.  In a recent post, I talked about how we recently decreased our contributions from 20% to 10%.  My husband’s company match is 75% on the first 6% - keeping at 10% will help us in attaining our goal of $100,000 in retirement accounts by the end of the year.

4.  Pay down our mortgage so that the balance is at 75% of the value of our home - this will allow us to close our escrow account and keep the money in savings.  Since we are about $3000 away from reaching this goal, it seems reasonable.  Although interest rates in savings accounts isn’t so great right now, the lower mortgage payment would be a nice psychological boost.  I know we have enough discipline to put the money aside every month, and I also like the idea of having a little more wiggle room about where our money is going every month.

What do you think of these goals?  Are we destined for failure because we are not following the Ramsey plan exactly?