I messed up somewhere. My checking account does not have enough money in it to cover what is left to come out this month. I don't know what I did, but I have a feeling it has to do with daycare. My daycare checks generally come out of my account the Monday after I write them. However this last week nothing came out on Monday. So that means I have 3 weeks left to go and not nearly the money to cover it.
Now, I DO have money to cover it, but I will have to take it out of our Annual expenses account which must be paid back. So my car which should have been paid off two months from now will probably take a little longer.
This has made me realize that I need to pay my daycare differently. Instead of just leaving the money in there I will transfer it after writing each check. When the check clears I will mark it off. I also need to keep better tabs on the checks. Since this is the only thing I write a check for, I don't pay attention to the numbers or the dates, but this is obviously an issue that I didn't realize.
What most likely happened was one month a check had not cleared and I thought it had so I started my budget over at zero instead of holding that money out. That is a little hard to believe though because that would leave a lot of extra money in my account.... so I am not quite sure what is going on. But, I now see this as an area where I need to make some changes.
So now I have to go back and see what is left to be paid in all categories this month and subtract how much is left in checking to see how much I owe back to my checking account. I will have take that amount out of the savings account and put it back when I get paid next week. I am really frustrated with myself over this, but it just goes to show that I am getting to comfortable with things and not paying attention.
Sunday, July 19, 2009
Friday, July 17, 2009
What Order Should These Go In?
Dave Ramsey has a good plan with his baby steps, but I almost wish he would write a follow up book for some variations on the plan. For example, here are his steps:
$1,000 to start an Emergency Fund
Pay off all debt using the Debt Snowball
3 to 6 months of expenses in savings
Invest 15% of household income into Roth IRAs and pre-tax retirement
College funding for children
Pay off home early
Build wealth and give! Invest in mutual funds and real estate
Okay, so I am getting close to finishing step 2, and I have a little more than $1000 in savings but no where near my 3 to 6 months worth. However, I need to do some other things as well, for example:
Get my Master's Degree
Possibly get Board Certified (will cost me $2000 which is paid back to me whether I pass or not and if I pass I get $6000 a year for so many years... don't remember exactly how many)
Buy a home
I will have a child in college in 7 years.
So, in what order do I put these things? Getting my Master's will earn more income for me and will help me put other plans into effect. We have really outgrown our living space and need a slightly bigger house (we do not own currently) Board Certification is probably something I should use my next tax refund money on.... And, we have $500 in an account for my oldest child's college right now. The good thing about her though is that I only have to include my income on her FASFA because my husband is her step dad. That will probably help her get grants. BUT, I also need to start putting away for retirement too.
My thought is this....
Use tax refund to get Board Certified next year
Save 3 to 6 months living expenses and tap it each semester to pay Master's Degree tuition, BUT pay it back just like when we were debt snowballing
Invest the 15% of income in IRA
And, with what is left we should know how much we have to go toward a home.
Pray that my oldest child qualifies for grants because she will probably be in college at this point.
And, start saving for the other two because they likely won't qualify.
What are your thoughts on this plan? What order would you place them in?
$1,000 to start an Emergency Fund
Pay off all debt using the Debt Snowball
3 to 6 months of expenses in savings
Invest 15% of household income into Roth IRAs and pre-tax retirement
College funding for children
Pay off home early
Build wealth and give! Invest in mutual funds and real estate
Okay, so I am getting close to finishing step 2, and I have a little more than $1000 in savings but no where near my 3 to 6 months worth. However, I need to do some other things as well, for example:
Get my Master's Degree
Possibly get Board Certified (will cost me $2000 which is paid back to me whether I pass or not and if I pass I get $6000 a year for so many years... don't remember exactly how many)
Buy a home
I will have a child in college in 7 years.
So, in what order do I put these things? Getting my Master's will earn more income for me and will help me put other plans into effect. We have really outgrown our living space and need a slightly bigger house (we do not own currently) Board Certification is probably something I should use my next tax refund money on.... And, we have $500 in an account for my oldest child's college right now. The good thing about her though is that I only have to include my income on her FASFA because my husband is her step dad. That will probably help her get grants. BUT, I also need to start putting away for retirement too.
My thought is this....
Use tax refund to get Board Certified next year
Save 3 to 6 months living expenses and tap it each semester to pay Master's Degree tuition, BUT pay it back just like when we were debt snowballing
Invest the 15% of income in IRA
And, with what is left we should know how much we have to go toward a home.
Pray that my oldest child qualifies for grants because she will probably be in college at this point.
And, start saving for the other two because they likely won't qualify.
What are your thoughts on this plan? What order would you place them in?
Thursday, July 16, 2009
So, I Made Some Decisions
I can't believe it has been four months since I have posted anything. I am a bad bad blogger!!
What I decided about the car...
I am paying on the car as soon as I get the money. I found that it doesn't really matter when I pay it, the interest does not change, except that I pay a little less each time I pay on the car because the principle is going down. Also, this keeps me from saying... well, I guess I can tap into that cash in the car snowball fund. If I just go ahead and pay it toward the car it is gone and can't be spent on anything else... more about that at the bottom.
On summer school....
I DID teach it this summer and it was so awesome! I was expecting to teach English to younger kids, but ended up teacher Algebra to older kids and I LOVED it. I have never taught math to that age. I loved the subject matter and the kids were really cool and fun. Last year I had a group of hellions!!! The only problem came when I got paid... Over 1/3 of the money went to taxes, etc.!!!!!!!!!!! It honestly was NOT worth my time for the amount I got paid, but I learned some things about myself and will probably get it all back in a tax refund in January. Which by the way, WHERE is this year going??
Ok, so some other "info". My spending is OUT OF CONTROL. I guess it is not SO bad as I am not using credit. It is just that I am spending money that I should be using to pay off debt. And, I am not doing that. This is such a big deal to me for us to get out of debt so we can build up our big emergency fund and then buy a house, but I just can't seem to do it! Then I think maybe I am just beating myself up because there has not been a month that has passed since my last post that I have not paid $500 extra on my car. And most of the time it is MORE than that. All my summer school money went toward the car and after my next regular payment I will owe less than 1000 dollars on it. So, I am not sure what the deal is here.... On one hand, I am doing pretty well, but on the other hand it is getting to the point where things are REALLY tight at the end of the month. BUT, they are not getting put on credit and we somehow pull through every month.
Another decision I have made is that I am going to start saving a little each month starting now AND once the car is paid off I will add to that. Here are the reasons. I want to open an IRA at Vanguard which takes $3000 down. I have not been saving towards retirement since the baby was born due to the extra cost of daycare. But, now I see I have an extra $100 per month. So, my plan is to save up for the $3000 deposit then use $100 per month to pay toward retirment until my debt is gone in which case I will pay more into that. (Please remember I DO pay into manditory retirement every month so I am not doing NOTHING in that area.) Once my car is paid off I am going to put another $100 towards savings for a car replacement fund. It is eventually going to happen so I may as well start planning for it. Once my car is paid off we have two debts left both are under 5% interest so I feel okay doing this.
And finally, see when I don't post I have to do these long stupid ones, I am going to try to start posting monthly about my progress on everything. Hopefully this will help me be more accountable for my spending and financial decisions.
What I decided about the car...
I am paying on the car as soon as I get the money. I found that it doesn't really matter when I pay it, the interest does not change, except that I pay a little less each time I pay on the car because the principle is going down. Also, this keeps me from saying... well, I guess I can tap into that cash in the car snowball fund. If I just go ahead and pay it toward the car it is gone and can't be spent on anything else... more about that at the bottom.
On summer school....
I DID teach it this summer and it was so awesome! I was expecting to teach English to younger kids, but ended up teacher Algebra to older kids and I LOVED it. I have never taught math to that age. I loved the subject matter and the kids were really cool and fun. Last year I had a group of hellions!!! The only problem came when I got paid... Over 1/3 of the money went to taxes, etc.!!!!!!!!!!! It honestly was NOT worth my time for the amount I got paid, but I learned some things about myself and will probably get it all back in a tax refund in January. Which by the way, WHERE is this year going??
Ok, so some other "info". My spending is OUT OF CONTROL. I guess it is not SO bad as I am not using credit. It is just that I am spending money that I should be using to pay off debt. And, I am not doing that. This is such a big deal to me for us to get out of debt so we can build up our big emergency fund and then buy a house, but I just can't seem to do it! Then I think maybe I am just beating myself up because there has not been a month that has passed since my last post that I have not paid $500 extra on my car. And most of the time it is MORE than that. All my summer school money went toward the car and after my next regular payment I will owe less than 1000 dollars on it. So, I am not sure what the deal is here.... On one hand, I am doing pretty well, but on the other hand it is getting to the point where things are REALLY tight at the end of the month. BUT, they are not getting put on credit and we somehow pull through every month.
Another decision I have made is that I am going to start saving a little each month starting now AND once the car is paid off I will add to that. Here are the reasons. I want to open an IRA at Vanguard which takes $3000 down. I have not been saving towards retirement since the baby was born due to the extra cost of daycare. But, now I see I have an extra $100 per month. So, my plan is to save up for the $3000 deposit then use $100 per month to pay toward retirment until my debt is gone in which case I will pay more into that. (Please remember I DO pay into manditory retirement every month so I am not doing NOTHING in that area.) Once my car is paid off I am going to put another $100 towards savings for a car replacement fund. It is eventually going to happen so I may as well start planning for it. Once my car is paid off we have two debts left both are under 5% interest so I feel okay doing this.
And finally, see when I don't post I have to do these long stupid ones, I am going to try to start posting monthly about my progress on everything. Hopefully this will help me be more accountable for my spending and financial decisions.
Saturday, April 18, 2009
Decisions
Ugh, I have quite a few decisions to make soon. I am not exactly sure what I should do on the first one. The second decision is kind of a no brainer, but I still have options so I guess I have to decide what is most important... money vs. sanity!
Anyway, the first thing is snowballing my car payment. I will have my car paid off this year one way or another. I have a $366 snowball to add to my regular payment monthly now that my last debt has been paid off. However, I get part of the money about mid-month and the other half right when the payment is due. If I pay my extra money on the day my payment is due it all goes right to the principle. If I pay it half way through the month some of it goes to interest. My problem is, I don't really know how this works. I am not sure if I am better off paying one payment mid month and another on the due date, or doing it all at once. If I was making a huge payment then I could see doing it as soon as possible because it would lower the principle amount such that I would not owe as much interest. But, with only a small payment, I don't know which is the best option. If anyone has any experience with this, I would appreciate some info!
My other decision is whether or not to teach summer school this year. I have done so for the past few years because it seemed like a good deal to me... 4 hour days, $100 a day, for 20 days. I take home an extra $2000 for a little work during the summer.
However, this year they have made a few changes. It will be 35 days, 5 hours a day at $125 per day. Now, that is obviously more money, but it is also pretty much my entire summer. I was miserable last year, the kids are horrible, but how can I pass up that kind of money? With those rates I would take home an extra $4375! That would leave my car paid off and would probably go toward paying off my next loan as well. Obviously this is a decision no one can help me with, but I will probably still do it. It is really hard to pass up that kind of money. I don't care how miserable I am!!! We will see though, the 5 hours is not set in stone yet, and if it were only 4 hours a day, I would definitely do it. The problem with that extra hour added in is that I would not be able to get things done in the afternoon before picking my kids up from daycare. I am sure I will update on the situation as more info is available.
Also, if anyone has any info on the interest thing please comment!!
Anyway, the first thing is snowballing my car payment. I will have my car paid off this year one way or another. I have a $366 snowball to add to my regular payment monthly now that my last debt has been paid off. However, I get part of the money about mid-month and the other half right when the payment is due. If I pay my extra money on the day my payment is due it all goes right to the principle. If I pay it half way through the month some of it goes to interest. My problem is, I don't really know how this works. I am not sure if I am better off paying one payment mid month and another on the due date, or doing it all at once. If I was making a huge payment then I could see doing it as soon as possible because it would lower the principle amount such that I would not owe as much interest. But, with only a small payment, I don't know which is the best option. If anyone has any experience with this, I would appreciate some info!
My other decision is whether or not to teach summer school this year. I have done so for the past few years because it seemed like a good deal to me... 4 hour days, $100 a day, for 20 days. I take home an extra $2000 for a little work during the summer.
However, this year they have made a few changes. It will be 35 days, 5 hours a day at $125 per day. Now, that is obviously more money, but it is also pretty much my entire summer. I was miserable last year, the kids are horrible, but how can I pass up that kind of money? With those rates I would take home an extra $4375! That would leave my car paid off and would probably go toward paying off my next loan as well. Obviously this is a decision no one can help me with, but I will probably still do it. It is really hard to pass up that kind of money. I don't care how miserable I am!!! We will see though, the 5 hours is not set in stone yet, and if it were only 4 hours a day, I would definitely do it. The problem with that extra hour added in is that I would not be able to get things done in the afternoon before picking my kids up from daycare. I am sure I will update on the situation as more info is available.
Also, if anyone has any info on the interest thing please comment!!
Wednesday, April 15, 2009
Getting too comfortable?
I think I am getting a little too comfortable with my finances again.
The more bills that we pay the more room we have to "breathe". I know I am overspending, but it isn't really causing a big problem right now because I have the money to do it. However, I am using money that could be snowflaked to my debt.
The more bills that we pay the more room we have to "breathe". I know I am overspending, but it isn't really causing a big problem right now because I have the money to do it. However, I am using money that could be snowflaked to my debt.
- Snowball- using money from a paid off debt toward your next debt. You continue paying the minimums on all other debts and just work on one at a time this way.
- Snowflaking- bits of money you save from other areas in your budget which are then added to the monthly snowball amount to pay debt off faster.
For instance... this month we charged an additional $40 on our gym account! We have to charge $25 a month that is built into the monthly fee, but we went WAY over. Yikes!!
Then I bought some additional supplements that I could have done without... we won't talk about how much those were. So, you KNOW it was too much!!!
If I honestly looked at this month's budget and last month's I could probably find and easy $100 or more that could have gone to my snowflake efforts.
One thing fueling this is that DH gets a lot of overtime some weeks. I LOVE when that happens naturally, but I give him extra pocket money and a lot of times some of the rest goes to cover our overspending. (I feel he deserves the extra money for working the extra hours, but I sure don't!!)
I am going to start really working on this for the rest of this month and next. I want to try to actually track it and see what happens. I will let you know soon!
Oh, and I haven't been TOO bad. I paid an extra $100 on my car this month, I have $200 to add to the snowball payment at the end of this month, and I hope to add to that on Friday. BUT, think about how much I could have added to that if not for the overspending!! I probably could have made an entire car payment with the money I have overspent with!
I am going to do better though!!
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