Saturday, October 25, 2008

Your Extra Paycheck

Trent at the Simple Dollar posted recently about what you should do with an extra paycheck. He says you should treat it like a regular one. I agree somewhat buy not entirely. Of course I don't believe you should blow it all on yourself either. Since we will be getting ours next Friday I thought I would break down what I plan to do with it.

1. Take out 2 weeks expenses. Don't forget to take money out of the check that you will actually need during the two week period. Lunch and gas comes to mind. These are expenses that I pull every two weeks for my husband. (Mine come out monthly)

2. Sock it away. We have sub accounts in our savings for things like annual expenses, irregular expenses etc. I am going to make an extra payment into each of these accounts with this check. This means that this month instead of one payment we are making two. (You could do this with your mortgage too!)

3. Energy upgrades. I am going to buy a few things to make our home more energy efficient. Now is the perfect time to do it as we move out of the cool season and into the COLD season! We need some weatherstripping on a few of our windows. That is one thing I will be doing.

4. Christmas. I still have not started consistently saving for Christmas. My husband gets a reliable bonus check which we normally use. We will add any left over to that. Never fear!!! I am not planning on using it to over spend. We are going to make a Christmas budget and stick to it. Any extra money we have will go to debt repayment.

So, how do you feel about the "extra check"? Will you spend yours? Save it? Ignore it? I would love to know.

Monday, October 13, 2008

So, Static Isn't Working For Me!

I am conflicted. I cannot post as often as I would like, so part of me feels very guilty when I am "trying" to post daily and cannot. I feel like I am letting my readers down. However, I guess not posting anything is just as much of a let down. I had a long conversation with myself today though and I forgot that I started blogging for ME not anyone else, not to get readers, not to make money on adsense (which if you must know, I have yet to do!!)

I realized that while it is still going good, my finances feel chaotic because I am not talking about them. I am not getting ideas out of my head and on to paper... or screen. I need that. I need it for me and my sanity. I had forgotten how much blogging helps ME! So, I am back with this post and maybe another one, or maybe not (that is honestly why I stress subscribing... not to get a bunch of subscribers but so you will know if I post again.)

So, a little update. September was actually a little anniversary for me. It marked one year of putting my finances down on paper each month. I now have a better streamlined version, but those first few months of actually doing it on paper really helped me work out the kinks. I have also upped my grocery budget. I was really trying to come in under budget each month, but no matter how little I bought, or how many coupons I clipped, it was becoming apparent that my budget was inadequate. So, now I am shooting for $400 per month. I think this may have to increase even a bit more. For no other reason than the cost of things going up so much.

I really did myself some good this summer. I posted a couple times on how I planned to change my paycheck deductions, my w4 etc. Well, I did those things just in the nick of time. I think that is why the gas issue didn't really affect us. Now that prices are going back down, I can actually use those increases I added to my budget to pay down some more debt.

I found out some bad-good news this week. I do NOT qualify anymore to have $5000 paid back on my student loans. This is bad because, well, if I had remained a regular classroom teacher i would have gotten the money. However, I also consider it good news because I was planning on doing this weird sidestep thing on paying back that debt and now I know I can just go ahead and pay it down like any other debt because there will be no extra money.

I am starting to get a little backsliding from my dear husband... He is starting to want to spend again. He got a raise at work which I think would be best served going to pay back debt, however he thinks I should add it to his biweekly allowance. I do not agree. We will see what comes of this.

Anyway, I have had ideas recently for posts, but I did nothing with them since I was "static" over here. I have changed my mind. I think I will post when the mood strikes me, but as usual, you can expect this blog to pick up more around holidays and summer. Today is my first true "day off" (no kids, no work) since July!! Ahhhhhh....... I am enjoying it.

Sunday, September 21, 2008

Going Static for a While- Please subscribe!

I really thought that I would be able to get more posts in. Lately I haven't even had time to get on the computer and check my email. I have decided to just let POW go static for the time being. I may post some things here and there, so if you do enjoy my posts I highly suggest you subscribe. That way you will be updated ONLY when there is a new post and won't have to check here for new posts.

I figured I would do a quick update on our financial situation. I had to take $500 out of our emergency fund to cover expenses preparing for Gustav. We were missed thank goodness, but we didn't get our money back. I guess overall it will even out because I won't have to buy batteries or canned goods for a while. Also, thanks to some overtime we were able to pay the E fund right back.

One day I may post on my new system, because it is really working out well for me. I keep my bill info in an Excel worksheet I created and keep up with our subaccounts in MS Money. We have money socked away for irregular expenses and our lump sum fund for our annual expenses is growing nicely.

I really appreciate those who have participated in POW comments etc, over the last couple years. This is not goodbye, but I just have so much I am focusing on right now. I don't have the quality time to devote to this blog. I don't want to leave you with a bunch of cruddy posts. Thanks for reading. Please subscribe!!

Thursday, September 18, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

Today you get a two-fer. My biggest money mistakes followed by my biggest accomplishments. And, I have to make another little change there. I did stop contributing to retirement a few months ago but only long enough for me to get out of debt. And, since I have been going non-stop for 8 years it shouldn’t be so bad. Oh, and I still contribute to my mandatory retirement so there is still SOME going in. Read these and see how many you have done or are doing!!

Tuesday, September 16, 2008

Back to Basics Post 8 A Few Parting Words

For the final post in this series I just wanted to talk about what to do when all the debt is gone.

First of all, you need to think about the future. Dave Ramsey suggests continuing to save until you have 3 to 6 months worth of income in savings. This will cover you if you lose your job unexpectedly.

After that it is time to think about retirement. You should be able to max out an IRA at this point. If your job gives matching contributions for a 401K contribute the maximum amount.

If you are fully funding the retirement accounts each month then you can think about saving for a house, or kid’s college, etc.

I have also made it very clear to everyone that once my debt is paid off the first thing I am going to save for is a trip to Disney. I ran the numbers recently and by the time we are done paying off our debt we will have $1600 coming in free and clear each month. In two months we would be able to have enough money for a great vacation. (We don’t pay that much in debt each month but we do have two kids in daycare and they will be out by that time.)

So, once you start really working at it you will see your debt clearing up and many possibilities for the future. I hope if you are not already using the steps in Back to Basics that you will start soon!! I hope you have enjoyed this series!! Thanks for reading!

Thursday, September 11, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

This was the BIG News that changed my plans and my life forever. And, I am pleased to report that I DID IT…. DEBT FREE…. BABY!

** My thoughts and prayers are with all those who lost someone close to them 7 years ago today!

Tuesday, September 9, 2008

Back to Basics Post 7 How to Get Out of Debt Faster

If you are just finding the Back to Basics series you can find all of the posts in the series by clicking on “Back to Basics” in the sidebar. So far we have discussed tracking our money, finding money in our budgets, saving for an emergency fund, things to do before you start repaying your debt, and how to choose and implement a Debt Snowball.

Today I want to tell you how to get your debt paid off even faster.

The first time I ran my figures through Dave Ramsey’s Debt Snowball Calculator and saw it would take us 53 months to pay off our debt I was a little upset. I wanted it to happen faster obviously. Well, I forgot about a few things. Number one you can make it happen SOONER!!

This is known as Debt Snowflaking. Think of a snowball. Obviously this is where most of your efforts are focused. A big ball made up of all the extra pennies you have to throw at your debt each month. A snowflake is the same thing, just on a much smaller scale. (Although not always.) A snowflake is when you get extra money during the month and you add it to your debt before you can even think of what else to spend it on.

Many people use a change jar for this. Whatever money is for spending each month goes into their pockets, but when they come home at night they put any coins into a jar. At the end of the month they money in the jar is cashed in at the bank and immediately that money is transferred to the debt you are working on.

I have found many other ways to do this though. You can have a yard sale. All the money from the yard sale goes to the debt.

I shop using coupons and often there will be a rebate on a product I use. I apply for the rebate and when that check comes it goes to the debt.

If I get unexpected money it goes toward the debt. Recently I got a check back from one of our doctors for overpayment. I put it all toward my credit card.

There are also many websites online that will pay you for surveys etc. If you look at the sidebar up top there are several links to places like CashCrate, Survey companies and Cash4Books. I have gotten money from all three of these and have used it to pay my debt down even more.

I have also begun to sell items on Craigslist and Ebay. That money is still waiting in my PayPal account to be transferred.

I promise if you look hard enough you can find ways to pay off your debt. Get creative. The more you can do the faster you will be out of debt.

Thursday, September 4, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

I don’t know when you will actually read this but today is July 28, 2008 (I am scheduling this for some time in the future). This post was written exactly a year ago today, and I tell you what. I still use this to make me feel better when I see others with toys I would like to have, but choose not to buy in order to become debt free. Who knows maybe it will help you too!!

** Just to clarify... I wrote this post in July, but it is being posted in September!! Ahh, the magic of the internet. (and today is still July 28, 2008) It is like time travel.

Tuesday, September 2, 2008

Back to Basics Part 6 Does it Matter How You Snowball?

If you are just finding the Back to Basics series you can find all of the posts in the series by clicking on “Back to Basics” in the sidebar. So far we have discussed tracking our money, finding money in our budgets, saving for an emergency fund, and things to do before you start repaying your debt.

The next item up for discussion is the Debt Snowball. This can be quite controversial. There are diehards on both sides of the coin. I will give you a brief synopsis of what each “side” is, and which to choose based on your personality.

The Dave Ramsey Method
For either method you will need to be able to list all of your debts. For this one list them in order from smallest debt to largest debt. You don’t need to worry about the interest rate. So, let’s say your first debt on the list is a hospital bill for $150. You are paying all the minimums on all of your other debt until it is that one’s turn on the list. So, all cards are being paid at the minimum but on this debt you happen to have “found” $150 a month in your budget so month one of your snowball you pay this bill and it is gone… poof!! Next month you start to pay your gas card. You owe $500, your minimum payment was $15 a month, but NOW you have the $150 of “found” money so you start paying $165 per month. Once the gas card is paid off you take that $165 and add it to the next debt on the list.

Who is this for?
This is for the person who needs to see progress to stay motivated. By paying off the smallest debts first you feel a sense of accomplishment. As you are able to cross more and more debts off the list you get even more motivated and start selling baseball cards and other junk to add the money to your debt payoff.

The Dave Ramsey Doesn’t Know Math Method.
Obviously the way to save yourself money on interest is to pay the debt with the highest interest rate off first. Now, I still would pay of things like hospital bills first because if you don’t they will be sent to collections. So any bills like that I would still pay immediately. But, let’s say you don’t have any of those. You have a car payment of $500 a month and you accepted an interest rate of 13% on that car. This is your highest interest rate and you still owe $20,000 on the car…. Ouch. So, you add your $150 of found money to the car payment and are now paying $650 a month. When you finally pay off this car you go to the next highest interest rate 10% on a credit card which now only has a balance of $1000. So you are paying $650 plus whatever your minimum payment was. This method will get you out of debt a little faster and will save you a little money. But, like I said, it may not be for your personality.

Who is this for?
This is for individuals who have strong will power. Even though you will not see a lot of progress at first you are able to keep in mind at all times that in the end you will save yourself some money and time. But, how much? I can tell you exactly….

Here are my debt stats paid off using both methods, however I had to change my interest rates on a few items because believe it or not my debt lines up smallest debt has highest interest and my largest debt has the lowest rate. (In other words if I didn’t change the interest rates they would both be equal.

Dave Ramsey Method
Debt will be paid off in 61 months.
Total interest paid $7163

Dave Ramsey Doesn’t Know Math Method (I got that term from Five Cent Nickel)
Debt will be paid off in 61 months
Interest paid $7100

So with the more mentally draining second method I only save $63 in interest. That is enough for me to say I will go with the more motivating technique.

So, there you have it. Your next step is to begin the debt snowball. You may think since this is going to take a while you need to stop reading the Back to Basics series. However, next week I will tell you how to get your debt paid off even faster.

I used the Dave Ramsey Debt Snowball Calculator to get my results. This is something I purchased from his website.

Thursday, August 28, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

Oh, the lies we tell ourselves!! I was telling myself a whopper. We are actually a little worse off now having just purchased another vehicle, but it lowered our monthly bills, we had to have another vehicle, and now we are no longer living paycheck to paycheck. Yea! Check out this post and see how truthful YOU are!!

Tuesday, August 26, 2008

Back to Basics Post 5 Before the Snowball Rolls

If you are just finding the Back to Basics series you can find all of the posts in the series by clicking on “Back to Basics” in the sidebar. So far we have discussed tracking our money, finding money in our budgets and saving for an emergency fund.

Today’s topic is what to do before you begin the debt snowball. Now that you have $1000 in an emergency fund you are ready to begin paying off your debt. But, how good is your budget?

If you are like me, I was changing my budget daily when I first started…. “oh yeah, we have $20 in prescriptions each month”, or “Oh, I forgot that we buy dog food every other month.” So, you probably know that there are some things you have forgotten about. Another thing that was lacking in my budget was a plan for yearly expenses. For us, those expenses are car license plates and our real estate taxes. The grand total for all of this is around $2400 annually. So for us this means we need to save $200 per month to be able to afford these expenses when the time comes without wrecking our budget. I also decided that for things like hair cuts, oil changes, stamps, clothing, etc. I would budget another $65 a month. If we don’t use this money one month we will save it to use the next month. If it runs out then we just have to wait until we have enough to cover the expense.

Now, it is one thing to save all this money up, but how do you keep track? If you don’t keep track you will inevitably spend money that is meant for a specific purpose. Well, I created a Money file in MS Money that handles this for me. I got the idea from Trent at the Simple Dollar. He set up an ING account and created “sub-accounts” for this type of saving. You don’t have to use ING to do this. All you really need is a plain old savings account and a spreadsheet. First, decide what you want to sub-account for. In my case I have one called “irregular expenses”, another called “lump sum” (our $2400 above) , “hospital savings” (money left over from our hospital bills from the baby), “lease money” (we are holding on to a large sum of money owed for paying out our car lease and can’t get anyone to tell us who to pay!!) and “holding for bill pay”.

Each month we get three separate pay checks between my husband and me. I use the “holding for bill pay” to save extra money. This way I know it will not accidentally get spend, AND I have a specific place to put it and track it. So those are my sub-accounts. You will choose your own. If you don’t have any lump sum payments each year great, more cash to go toward your debt. But, I am sure we can all use some money for “irregular expenses”.

A side note. At this time do NOT save for things like vacations or a new TV (unless your old one is really about to die) we are only saving for necessities. All of our extra money we want going toward paying down debt. Got it?

Next week we will finally discuss the debt snowball!!

Thursday, August 21, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

Ahh, my first milestone. I won’t say what this refers too, because I want you to read the post…. But I am happy to say I can now boast the same thing except instead of a month it has been a year and a month!

Tuesday, August 19, 2008

Back to Basics Post 4 What to do with Found Money

If you have been following along with this series you should have a good idea of where you money is going each week. Last week, we also talked about some ways to “find” money to help get you out of debt. Today we will talk about what to do with that money.

First, if you have not already done so you must pledge to STOP CREATING NEW DEBT. Until you have done this, you can go no further. You cannot fix your finances if you continue to add to your debt. End of story. Taking the plunge can be hard and it really is a mind set. However, once you do this things will only begin to get better.

Now, the first thing we are going to do with this “found” money is begin an emergency fund. You should aim to save $1000 because that will cover most things that can go wrong. Some examples might be an unexpected trip to the emergency room, a car problem, or needing to have an appliance repaired.

All extra money each month should go to this purpose and this purpose only. Here is why. Once you have an emergency fund you will no longer be forced to use credit in an emergency. The problem I always had was that I would pay off my $2000 credit card balance, then my car would need repairs and I would immediately add $1000 right back to it. So, for the time being, pay only the minimums on all debt and save up to $1000.

The next logical step for anyone who has heard of Dave Ramsey is to begin a Debt Snowball, but that is NOT what we will discuss next week. I think there is one more thing to do first…. To be continued!

Saturday, August 16, 2008

I did something really stupid...

Well, not all that stupid. I won't LOSE any money over it. But, I decided to sell our old Blackberries. We recently traded up/down (depending on how you look at it) to some different phones to save money. We ended up saving about $100 a month doing this so it was well worth it. Anyway, I sent them to I was going to get about $16 for the pair. This was the highest amount I found online, but I didn't spend enough time on the site.

Going back I found many misspellings on the site and in their email to me. This sent up a red flag. Usually people who can set up a business can at least run their things through a spell check and make sure their site uses proper grammar.

I still have a few days before they say I should know something. They keep telling me it takes exactly a month for them to check the phones because of the number they receive. We will see, but I think this one is going to be a loss.

Oh, by the way, I have found a great site that gives you gift cards for points. It is actually pretty easy to get points and you could get a $50 Visa gift card in 33 days of getting points. (because of a daily point cap) You can earn a $25 Target or Best buy in 17 days (but we don't have those stores here.) If you are interested please email me so I can refer you. I am doing the referral contest for even more points.

Thursday, August 14, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

I still think this is hands down, the best thing I have ever written about finances. If you and your significant other don’t agree on money, THIS is the post for you!

Tuesday, August 12, 2008

Back to Basics Post 3 Finding Money

We started out our Back to Basics series talking about what your goals were for your money. Last week we set up a budget so we could begin tracking expenses. If you have these two steps down you are actually doing pretty good.

Chances are when you made up your budget last week you subtracted expenses from your income and came up with a positive figure. It may have been in the hundreds of dollars… you were probably thinking, “I should have X amount of dollars still in the bank each month!” Since it has only been a week since you started tracking, here is the secret…. You are spending that money each month too, you just haven’t caught yourself yet.

When I first made up my budget, I was coming up with an extra $300 a month. I knew it was going somewhere but I didn’t know where. Tracking helped me with that and it also helped me “find” some money.

So, how do you “find” money? Well, how much you can find depends on how upset you are about your finances. I was really upset. The first thing I did was to look at my monthly bills and see what could go. Early on (before even beginning budgeting) I cut out the premium cable channels. Later, I bundled our cable, internet and phone service and saved us about $80 a month. Next came our cell phones. If you are paying for internet at home and you very likely have access at work too WHY do you have it on your cell? That saved me $30 a month. (My husband doesn’t know it yet, but he is about to start saving the same $30 a month)

We are very dedicated to getting our finances under control. Currently we do not eat out, rent videos, go to the movies, or take vacations. And, YES, our lives are tolerable. We have video games at home and a few DVD sets that we watch quite often.

DO THIS: Now that you have started a list of your expenses, go back through and find some things that are not really necessary. Cut them out or cut back and you will have some of that money back in the budget for more important things.

Next week we will renew our promise to STOP CREATING NEW DEBT and talk about how to use that newly found money.

Thursday, August 7, 2008

WOW! PoW Retro!

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

I made a few changes early on to start lowering our bills. Eventually I cut off our phone service and had it added in with our cable services which ended up saving us almost $75 a month. This post I added because it just shows how when you start thinking you can find a lot of ways to free up money.

Tuesday, August 5, 2008

Back to Basics Post 2 Tracking Your Cash

Last week we talked about what was upsetting you about your finances and what you wanted to get out of getting your money under control.

Now that you have some roughly defined goals, lets move on to step two. If you had a ton of money left over each month you wouldn’t be reading this. You wouldn’t need to. So, most of us are here because we are living paycheck to paycheck or perhaps worse… credit card statement to credit card statement.

The first thing you need to do is look at where your money is going. You may not be able to do this yet. If you have an online banking account where you can see exactly who got each of your hard earned dollars you may be able to look back and get an idea. If you don’t have this luxury you need to begin tracking your expenses. I am not going to tell you that you can’t go any further until you do this, but it will be hard to get a solid plan until you have done this for a few months.

DO THIS: Come up with a list of everything you “think” you spend in a month. Write each item down with the amount you spend on it. At the top write down your income too. Then add up everything you “think” you spend money on and subtract it from your income. Right now it does not matter if this number is positive, negative, or zero… we will get to that later. Guess what? You just created a budget!!!

The word budget is like the word diet. It has gotten a negative connotation. A diet is truly just what you eat. It doesn’t mean you are cutting calories. A budget is the same thing. It is just what you spend. It doesn’t have to mean you are cutting out all the fun stuff in life. But, you NEED to know where your money is going presently, so you can MAKE it go where you want it to go in the future.

This is not going to be set in stone… hope you didn’t use a pen. Keep this list around for the next few months. I promise you will be adding things to it that you didn’t realize you were spending on. The first month I had to buy dog food after I started my budget I freaked out because I had to take $30 out of the grocery budget for the pet food!! (We don’t have this expense every month.) This month my husband started a new medication that is $20 a month, so that had to be added. Next month when school starts again we will have to shell out $35 a month for school lunches. So, you will be adding to your list. That is okay, don’t freak out every time you do this. We will get your “budget” to a manageable point soon. Just keep tracking that cash flow!!

Next week we will talk about adding more money to the budget. It can be done!!

How are you doing so far? If you have any questions just ask. If you want me to try to help you with your budget please email me.

Thursday, July 31, 2008

WOW! PoW Retro

PoW Retro (that is Picture of Wealth, not prisoner of war) is a look back at some of my favorite posts over the past year and a half. I hope you enjoy these!

This was the very first post on this blog. Dated March 25, 2007. Wow, has it been that long. And, reading this again I was surprised at how much I have learned since that first post. I can answer all of the questions I posed there…. Can you?

Tuesday, July 29, 2008

Don't Replace, Repair

I can't imagine what life will be like when my daughters are my age. Even I have become somewhat corrupted by today's technology which is awesome.... but disposable.

A few days ago our washer quit working. The agitator would not agitate. And, our clothes were not getting clean. My knee jerk reaction was that we were going to have to use our emergency fund to buy a new one. And, our dryer was not really working all that well either so I may as well replace that too.

I forgot that there are these guys (and gals) known as repairmen. And, they can actually fix things that are broken instead of you having to replace them. Now, this would not work for a cell phone or a cd player, but they can fix your major appliances.

So the repairman came today and for $160 I now have a working washer. I just wanted to remind you all that sometimes you don't have to replace, you can repair!!

Monday, July 28, 2008

Back to Basics Series- Getting Started Post 1

First let me say that I love almost every personal finance blog I come across. I love the how-to’s, the out of debtors, the still in debtors, even the bread recipes. However, for the newbie just getting their finances in order some folks are forgetting that there are still people who need the basics. This is for you!! Over the next eight weeks, I will be running a series called “Back to Basics”. I will go over the basics of money management. So check back each week, or better yet, SUBSCRIBE so you don’t miss anything.

Maybe you are reading this because you are in debt. Maybe you are not in debt but are sick and tired of living paycheck to paycheck. Getting out of debt and getting your finances in order takes a lot more than reading and planning. It truly is a new mindset. The first thing you need to do is clearly define WHY you want to get out of debt or get control of your finances.

DO THIS: Get an old notebook (DO NOT BUY A NEW ONE) or create a new file on your computer. Write down all the things you HATE about your current financial state. You can write things like, “I am tired of owing people money”, “ I hate living paycheck to paycheck”, or “I hate having to donate plasma to supplement my income”.

Now, think about why you want to get your finances in order (no more negatives here). What is the end goal of getting better control of your money? Being debt free? Going on a vacation? What is going to motivate you? (You are going to need a LOT of motivation)

The point of this exercise is to think about what upsets you about the present and what you want to see happen differently in the future.

One more thing before I go…. You must make one promise to yourself right now. You cannot go any further until you do this. STOP CREATING MORE DEBT. Now. Today. This very second. No more debt.

If this has you worried about how you are going to afford groceries you have a big problem. You need to start thinking right now about what items you can cut out. We will talk more about that next week.

Our Winner! And, an Update!

The winner of the Snowflake Challenge is Tammy!! Yea, Tammy!! I will try to get in touch with you through your blog but if you read this please send my your address via email to

On another note, I am getting back to work here this week!! Ahhhh.... you know what that usually means... no new posts. However, I am working hard to have some things up for you all during my transition back to work. I am planning for at least two new posts per week and hoping for three. We will see how it goes! If you have any ideas about what types of things you would like to see discussed here I would LOVE to hear it.

Also, as always I am still offering my services for budget help. If you are having trouble coming up with a budget please email me and I will be happy to assist you with that. Please see the email addy above.

Have a great week. I am not sure exactly when the first of the new posts will be rolling out but it will be no later than next week!!

Wednesday, July 23, 2008

Not Debt Free, But at a Major Financial Milestone

I wish I could report that we are now debt free, but that is still a little far off. However, I can now report that we are no longer living paycheck to paycheck.

That's right, we are now officially spending less than we earn. Most of the extra money is going to be going toward the debt, but if I had a month where we needed the money for something else we now have it!!

On top of that, we are finally saving for the inevitable. Like car maintenance and medical expenses. I know it is not 100% foolproof yet, but our budget is getting better by the month!

I guess I should admit that we added a bit more debt to be able to do this, but at the same time we will be able to pay off all of our debt much faster now. We got out from under a leased vehicle (which I could have killed my husband for doing in the first place!) and bought a repossessed vehicle from our credit union. So, we got a pretty sweet deal on it.

We were going to need another vehicle when the lease was over anyway, we owed less turning it in than if we continued making the payments until January, and now we have some breathing room!!

This is also a result of me changing my w4 and taking out some other deductions from my paycheck. I will make another change in October when our open enrollment takes place at work which will add even more money to our debt snowball.

For the first time in a long time, I feel really good about our finances. It was not that it was that bad before, but we were not able to put say, $20 a month aside for pet vet visits etc. Now we will have that money accruing each month in different categories so that we don't have to use our emergency savings for non-emergency purchases.

And, in true fashion, just as we have gotten to this point our washer broke down, lol. We will have a repairman coming out on Monday. This is one of those things that I COULD use emergency fund money on, but I don't have to because we have the extra in house maintenance fund! (Unless the repairs are really expensive of course)

In other news... I will post the winner of the David Bach book tomorrow, but it seems pretty obvious who it will be since I only have ONE entry... No one was snowflaking this week? You have until 11:59 tonight to enter the contest!!! See the post directly below this one for details.

Sunday, July 20, 2008

Snowflake Challenge

Ok, here is your chance... Last week I started the Snowflake Challenge. The winner, via drawing, will get a copy of David Bach's Start Late, Finish Rich. Like I said before, even if it does not apply to you, you could always use it for credit on Paperback Swap, etc. But, if you are over the age of 30 there are a lot of good "catch up" tricks in the book.

Here are the rules again. Add a link to your blog post telling about how you snowflaked you debt this week. If you don't have a blog you can enter by adding what you did to the comment section.

I will put all entries into a drawing this Wednesday, so you have until Wednesday night to add your post or comment.

There are extra entries for the following...
1st Person to post a linky or comment gets 1 extra entry

Most creative entry (as decided by me) gets 4 extra entries for a total of 5
Second place gets 2 extra entries for a total of 3
Third place gets 2 entries total.

I can't wait to see what you have done. Oh, and don't worry if you don't have the money yet. You can still enter. I got to thinking, I have a rebate coming, money for my cell phones coming, etc. They are all things I did this week but I won't get the money right away. So, if you did anything that you will use to snowflake your debt please go ahead and enter.

If you haven't logged on to Cash Crate Recently

Cash Crate

They have some new easy registrations for Home Depot and it goes straight to their website so I am pretty sure it is not going to spam you.

Also, if you fill out your info profile it will automatically give you a dollar... no waiting for offer pending etc. If you haven't joined yet you should. I got my first $10 check last month!!

Points for everyone!!!

I just joined a new site called It is for anyone 13 or older to join and take surveys. I just joined a few minutes ago and I already have 2,200 points!!! They are also giving away gas cards when you meet a certain point goal. The prizes are mainly gift cards but you can also redeem points to have $25 put into you Paypal account which is the best option as far as I am concerned. This reward costs 29, 000 points but like I said, in one day I have earned over 2000 points!! The reason I say pay pal is best is because they have other gift cards for $25 that cost more points ??? If you just have it added to your PayPal you can buy any gift cards you want. If you are thinking of joining I can get you some extra points!!!
This is my referral code 2151995221
It says on the application that you will earn 500 points for entering this code but I only got 100. I told them about it but it may have to do with the first quick survey being validated which takes a few days. Anyway, code is 2151995221 go here to join.... SayNation This is a direct link to the application.

Also, if you are interested in joining MyPoints (more free gift cards) will you please email me pictureofwealth @ so I can refer you? Thanks!!

Rethinking the Debt Savings Account

I hate to say I am wrong about things. But, I think I was wrong. Hmm, that wasn’t too painful.

I think the reason finances are so HARD to deal with is that there is no right answer for every situation. I think it is a great idea for everyone to begin with a $1000 emergency fund, but even Dave Ramsey says some folks only need $500 and others need even more.

A week or so ago, Trent at The Simple Dollar talked about a Debt Savings Account. Basically instead of snowballing your debt to the creditors you roll all the money into a savings account. Once you have a certain amount of money (depends on what you are doing) you take the money out and pay off some debt.

I have done this before. In fact, I just did it last week. We were not certain how much money I would need to a) cover my salary while on maternity leave, and b) cover our medical bills without going into more debt. So, what we did was to save and save and save, and wait and wait and wait. When I got the final bills from everyone, I paid them off and put the rest toward other debt we had outstanding. It worked great. We were safe because we had the money so that if the hospital had charged a couple thousand more than we anticipated we could have still paid them off. Yet, once we got the true amount we had the extra money to pay off some debt. So, we got both of the things we wanted… no new debt and some old debt paid off.

Now, my original plan once we finished up with the hospital was to start a debt snowball with our other outstanding debts. But, as they say, life happens.

We are now expecting two more bills that won’t be outrageous but will be in the hundreds of dollars category. There is also a little situation that may be coming up soon which would cost us a minimum of $1500. Now, we have our emergency fund, but since we KNOW these expenses may be coming up soon we should do the smart thing and start saving for them instead of paying off debt right now.

So, here is what I plan to do. There is one more card that I plan to pay off. It is a small balance and it will add $50 a month back to our income. After that I will pay one of the small bills that we are anticipating. This will take us down to almost $0 in savings EXCEPT for our emergency fund which we don’t plan to touch. Then instead of beginning to pay down our debt at snowball speed, I will put money into savings until we reach probably the $2000 just to give us some room. After this we will begin our snowball. We should know what is going on with that possible other expense by Christmas. If we have not used the money by then, I plan to put that toward our debt as well.

So, I guess I will be using a Debt Savings Account after all, even though I said I wouldn’t. There really are some cases where it is necessary to use this method. For some reason we just keep running into them. I still don’t agree with the notion of saving 3 to 6 months salary first because for us that would take a really long time and we would be paying interest on all the debt. But, I do believe if you know an expense is coming up you should stop debt payments (except min. of course) and save so that you don’t have to dip into the emergency fund for these “unexpected, expected” expenses.

Saturday, July 19, 2008

Get That Man (or Woman) on Board

I honestly don’t know what I would do without my husband. He is an awesome guy! He helps around the house, in fact last night he made dinner. We complement each other pretty well. He is a talker, I am a listener (until I decide to give him what for, lol) He is outgoing. I am shy. I am the eternal optimist and he is rather pessimistic. Sounds like those two would not go together but actually we keep each other in check. He keeps me from thinking I can fly if I jump off the roof, and I keep him from thinking that the sky is falling.

One area where our styles don’t exactly meet is with finances. He is the spender. I am the saver. Yeah, you can see where this is going. He has been so brainwashed by “them” that he really thinks it is impossible to get ahead with the jobs that we have. He thinks we need to make more money. I have tried telling him how much more money we will have when we are out of debt, or done with daycare, but he has a hard time grasping the idea.

Recently he watched me write 7 checks. I paid off seven creditors (with money from our crisis plan) this was mostly medical bills but it also included my first credit card. I don’t know what happened. It was like some little switch finally clicked in his head. He finally “got” it. He decided he wanted to help!!!!

The only thing I can think of here is that he is a visual learner and actually seeing the debt going away made him realize that it WAS possible. Maybe something like this will help you get your significant other motivated. Let them SEE where the money is going. Let them enjoy that little taste of freedom when you have gotten out from under another creditor.

Think about this. Spenders have to be visual people. Part of the problem they have is they SEE a product, they go into the store and are overwhelmed by the sights and sounds. When they leave they have something tangible in their hands that they can show off.

Here is how things were happening before. I would get online, pay our bills, say nothing to my husband, and go on with my day. He was not involved in any part of the process. It was not a purposeful thing. I just never realized he needed to be part of it. He needed to SEE it for himself.

He isn’t trying to sell his most prized possessions or anything yet, but now that I know this will help, I will make SURE to include him any time I am making a big payoff. Currently he is working on finding a vehicle that is not going to put us further behind and he is actually doing a really good job. It took a few dirty looks from me when he kept going back to wanting a brand new vehicle, but now he gets it and I actually heard him telling his dad the other day…. “The monthly payment doesn’t matter, it is the TOTAL cost we are worried about.” Yea!!! I am so proud!

Friday, July 18, 2008

Are you getting ready?

The Snowflake Challenge will be posted Monday for you to add your own stories. I will close it on Wednesday. Be sure you post about what you did by Wednesday!! More info here.

I just wanted to get your creative juices flowing by letting you know what I have been up to. I sold two items on Ebay that I got for FREE. So I made a little cash off of those. I also got my Single Check Rebate from Rite Aid. That will be going toward the debt. I have a box here ready to ship off full of some old cell phones. I found a site that pays a pretty good price for them. If they don't pay for some reason it won't be a big deal because the shipping is free and the phones would never be used again anyway.

What are YOU doing to snowflake? Don't post it yet!!! Wait until Monday!

Wednesday, July 16, 2008

Final Hypermiling Report with/without Hypermiling MPG

Alright, my hypermiling experiment probably got more comments than any other post I have ever written. I think it got 3, lol. So, I wanted to publish my final report on the matter.

I did things a bit backward. I hypermiled a tank of gas first and found my mileage. Then I realized I needed an up to date baseline because the last time I had checked my MPG was a few years back.

So, my regular driving tank of gas earned me 19 MPG. My hypermiling driving tank of gas was 22 MPG. An increase of 3 miles per gallon. At first it does not seem like a lot, but remember we have to multiply that by the number of gallons my tank holds which is 16. So my efforts in hypermiling earned me and extra 48 miles on one tank of gas.

So is that good? For me YES!! Forty-eight miles is the equivalent of more than one day’s driving to me. I am extending my gas for an extra day each time I fill up. Say I fill up once a week. In one year I will have gotten an extra 52 days worth of gas.

I will include links to my other hypermiling posts at the bottom of this one so you can see what I did exactly.

I think I can do even better though. I mentioned in my last report that several times I had “forgotten” to use the techniques. If I can keep from doing that so much I will definitely improve my mileage even more.

Here are some more posts on this topic:
Gasoline Experiment
Final Results
More Tips

Tuesday, July 15, 2008

New This Week

I hope everyone is thinking up some great ways to snowflake this week!!

Check back soon for my final report on Hypermiling. I finished my regular tank of gas and you will be surprised by the results.

That report was supposed to be posted today, but I have had a lot of "life" happening lately!!

It will very likely be up tomorrow, but definitely before the week is out.

Monday, July 14, 2008

Snowflake Challenge- Win a Free Book!

What is it? The Snowflake Challenge is a contest of sorts. You come up with creative ways to earn money toward snowflaking your debt. The winner will receive a copy of David Bach’s book, Start Late, Finish Rich. (If you don’t like the book you can use it to get a credit on Paperback Swap or something.)

For example: You dress up like a clown on the side of the road and make balloon animals for passing cars at $0.50 each. (This is just a joke, but hopefully it will get the gears turning.) You take the $2.00 you made from folks who felt really sorry for you and put it toward your credit card debt. Have someone take some pictures of you and post them on your blog (not required, but it would lend more validity to your entry)

How do I win? On Monday (21st) I will post another Snowflake Challenge entry with a Mr. Linky for you to add a link to your blog post about your Snowflake Adventure. You can also post your info via a comment in that post. I will pick a winner from these entries. Believe it or not, you win just for playing because you will get some extra debt paid down.

How can I improve my chances? I will choose a 1st, 2nd, and 3rd place for most creative ideas (if there are enough). First place winner will get an extra 4 entries (total 5) Second place will get an extra 2 entries and third will get one extra entry.

Do I have to do something stupid or embarrassing? NO…. as long as you post a linky or a comment about what you did you will be entered. It doesn’t matter what you did, but you DO have to tell us about it. Entries saying, “sign me up” will not be posted or counted.

Tell me what you think and if you plan on entering. I would like to get an idea of how many people might be playing. Thanks!!!

Friday, July 11, 2008

Little Vacation

Most people took a little vacation last weekend, but Picture of Wealth kept going with some stories to keep you busy. Well, it is my turn now. I am taking this weekend off. So have a nice weekend and check back next week!

Wednesday, July 9, 2008

Warning for Parents That MAY Save You Money

I got this information over two months ago, but never thought to share it until now. On a recent visit to our pediatrician he made a comment that was pretty unbelievable. If one product were to be outlawed he would probably see 400 less cases a year!

That thing was plug in type air fresheners. He said it also would help if people did not use products like Febreeze and other spray fresheners too. However, the biggest culprit to children's allergy and sinus problems that he saw were the plug in fresheners.

Our new baby had been having sinus trouble. Her little nose was stopped up so bad it made it hard for her to eat.... imagine when you have to have a constant suction going on with your mouth to eat and your nose is clogged!!! The doctor asked if we had any plug ins which we did. Two very close to her sleeping area. As we were speaking to the doctor my husband blew his nose and sneezed at least 5 times. Thinking back, we had just changed out all the refills and our 3 year old had to be kept out of daycare that same week for bad sinus problems.

Of course we immediately came home and took them all out of the wall. We had probably 6 or 7 throughout the house. Well, our electric bill went down about $20 the next month. I couldn't believe how much money we would save by getting rid of these stupid things (I hated them anyway because the refills for the type my husband likes are $7!!) So here is the math.

$15 a month doctor copay for at least ONE of our kids needing to go to the doctor. (that is about what it was because before the baby came we were taking our 3 year old constantly)

$7 X 4 refills every two months (about what we would buy) $28 every other month.

$20 a month in electricity. (kind of hard to believe it was that much but that was how much it went down... possibly other factors. Plus I didn't include allergy meds which is expensive too, so I'm going with this)

That is roughly $588 a year!! Now seriously how bad does your house smell? Because we haven't missed them at all!! My husband and 3 year old are breathing much better. The baby is still having problems so there is something else bugging her but she is still much better than before. I was never effected by them and you may not be either, but if you have kids with allergies this may be the cause!!

Tuesday, July 8, 2008

They Made Fun of Me... I Guess That Is A Good Sign

In Total Money Makeover (see sidebar), Dave Ramsey says that when people start making fun of you or thinking you are crazy that is a good sign. It means you have "gazelle intensity" on paying off your debt and getting your finances in order.

Well, this weekend I was talking to some family members about thinking I had lost some coupons. One was for buy one get one free of something I use a lot, so I was really upset at the thought that I had lost all of these. (I found them later).

Anyway, as I was telling the story, I looked over and one of them was rolling her eyes at the other. It really hurt my feelings, and I immediately shut up about my coupons. I was thinking about it later (almost in tears) and realized this was in fact a GOOD sign.

I happen to know a little about these folks' finances, and I know it is NOT good. So, while I am using my coupons and saving money, getting great deals for my family, and building a secure future, they can roll their eyes all they want.

When I read TMM, I thought I would never see anyone making fun of me because of the kind of family (I thought) I had. But, now I know for sure I am on the right track, and it has just made my efforts that much stonger. In fact, I went home and listed a couple of items on Ebay!!

Yea me!

Monday, July 7, 2008

Carnival of Debt Reduction

Picture of Wealth is featured in this week's Carnival of Debt Reduction. An editor's pick too!!!! How cool!! I will try to post back with my faves later. You can check out all of this week's submissions here.

Why I Love Stockpiling

I posted a while back about what stockpiling is, how to do it etc. I am really beginning to reap the benefits of it now.

Current items that I have stockpiled are meat (in the freezer of course), cereal, other breakfast items, snack foods, soap, toothpaste, toilet paper, paper towels, and DIAPERS!! (yea, diapers!)
We also have what will be for us a year's worth of shampoo and dish liquid. And I paid a grand total of $4.25 for it all (shampoo and soap) after coupons and rebates.

I cannot tell you how much easier this makes my day to day life. Yes, it saved me money because I paid less money for these items because they were all on sale. However, the thing that makes me want to keep on keepin' on... is the fact that when I run out of something I can simply open another pantry instead of having to run to the store.

The biggest thing I am saving here is time and money! Who can't use extra time and money?

Here is a quick recap on how I got started. I took a small amount of my grocery budget and began earmarking it for stockpiling. That way it was there if I needed it for groceries, but its hopeful main use was stockpiling. Then I watched sale ads. It is helpful to have a price list to know what a good price is, but a little research on the net will tell you too. When items went on sale, I would search on line for coupons and buy them when they were at low prices.

Soon, I had begun my stockpile! Although I spent a little more each week than usual at first, soon my grocery bill was going down because we had things like cereal and meat on hand already. When a new sale happened, I stocked up again. It sounds a lot harder than it is. I encourage you to research stockpiling (and you can ask me questions right here) to see if it is right for you!

Sunday, July 6, 2008

The Answer I Have Been Looking For

Trent at the Simple Dollar recently posted about starting a Debt Savings Account.

My first thought was, this would not work for most people because the minute something came up (not an emergency) they would be tempted to spend it. I still feel that way, but I thought of a great way to make this work for me in a few years.

First of all, I have done this before. You will remember it as my crisis plan. This was where I continued paying only the minimums on my debt and saved like crazy for the baby. I still have the huge chunk of money because we are now fighting with the hospital just to get our claim filed. However, my plan for this money once that happens is to pay off a LOT of our debt. That is still my plan.

Trent, however, asserts that for emergency purposes it may be better to save up the money and once you have a nice sized emergency fund and have cash that goes above and beyond that you should throw a large chunk at your debt.

Here is my problem with that. Because I was not staying on budget so well the past few months, several times we have dipped into savings to cover groceries etc. (I am talking $20 not $200) So, that temptation to use the money for "other" things is huge. And, I believe it is mostly subconscious. For example, I was not planning on spending that money, but I knew it was there so I was NOT as careful with my grocery budget. If the money were gone, and all I had was my small emergency fund, I would make sure the money was not touched. I guess this would be a decision based on your personal will power... but all of us debtors got here the same way!

Now, having said that, this is a GREAT idea for my final debt. My student loans!! Instead of paying more money on it when I get to that point, I will put it in savings. This serves two purposes. One, of course is that I will still have the money to pay the debt off no matter what happens. The other thing is that IF I am allowed to have $5000 forgiven, I won't have paid that already. That money will just be extra savings and will be a great start to my bigger E fund.

So, read Trent's post and see if there is a way this can work for you. I made it work with my crisis plan and hopefully I will get it to work for my student loans too. Let me know what you think!!

Saturday, July 5, 2008

Not Worth My Time

I recently posted about using CVS to rack up some great savings. It is true that you can do this, and you can save a lot of money. However, I found I was going for things we did not need. I have decided that it is just not worth my time to work up deals (moneymakers or not) for things we don't use. CVS still has some GREAT sales.

Two weeks ago my husband's coffee was $2 cheaper than we can get it at Walmart. This week they had toilet paper for half the price it was at Walmart! I had a coupon too, but they were already out when I went on Monday. Anyway, I guess my point is, I will continue to use CVS for the great sales, but I will no longer waste my time on anything that we don't use... moneymaker or not.

That being said.... I have found a great time SAVER. is a great FREE service. They have circulars from all of your local stores and you can compare deals all on one page!! It is great! This is a great way to use sale ads to plan you trips. One problem- they don't add coupons into the mix and I think this is something they could do really easily. This is now featured on the Smartsource website and I know it would be nothing for SS to add the printable coupon links to the products on the page. Maybe they will do this at some point.

And finally.... HAPPY FOURTH OF JULY!!!!!!!!! Have a great weekend!

Friday, July 4, 2008

Financial Tip Friday- Hypermilin' Ain't Easy Edition

I am getting away from the basics this week to update you on my Hypermiling Experience. Remember, you can add your links at the bottom, but please be mindful of the RULES
1. Post a link to your post NOT your blog.
2. Your post MUST mention Financial Tip Friday and include a LINK back to this post or my blog.

Any posts not following the guidelines will be deleted! But, it isn’t hard!! Please join in!!

Hypermiling Tips

First of all, I have been told that hypermiling is really meant to be done with hybrid cars. However, I think the principles do work with regular cars, they just don’t change your MPG as significantly.

During my two week trial of hypermiling, I learned quite a few things about successfully and unsuccessfully doing it. It is not as easy as it sounds. If you missed the first few posts, you can read the things I did here. My final results are here.

1. It is easy to forget about. You jump in the car to run to the store for a much needed item and totally forget you are supposed to be coasting and using your cruise control. Or, you are late for something and get on the highway and SPEED, eek!! It is very easy to forget to apply the principles of hypermiling when you drive. I would suggest a little sticker or something on your steering wheel or close to the speedometer to remind you to do it.

2. It takes practice. There are times where I thought I could coast up to a stop, only to find myself irritating the person behind me because I was going 20 MPH and was quite a ways from the stop. This would cause me to use gas to get up to speed a bit only to stop soon after. OR I would take my foot off the accelerator too late and end up wasting gas by braking when I could have been coasting. I found it much easier to hypermile on familiar roads than on routes I took irregularly. In fact, on my regular routes I started using landmarks, like signs or patches of grass on the side of the road to help me remember where to start coasting.

3. Not all hills are created equal. Some hills will give you upward of an extra 5 mph by coasting. Some, believe it or not, will actually decrease your speed if you take your foot off the accelerator. This didn’t happen too often, but a couple of times it did and I was really shocked. The incline has to be such that the weight of the car counteracts it.

4. People can get mad. I didn’t really have this problem much at all, but when you coast up to a stop you will find the guy behind you starts really riding your tail. Not on purpose, of course, but you are coasting and they are still using gas. This can irritate other drivers, but it is also a safety issue so be careful. Sometimes if I found another driver behind me I would just keep up speed to avoid this situation.

5. YOU may get impatient. After using gas to get to stop signs or lights, it can be very frustrating to coast to a stop. I don’t know why, but it just doesn’t feel right. Your foot REALLY wants to hit the gas. This takes some getting used to. The best cure for me was to look at my speedometer. Even though I felt like I was doing 10mph usually I was doing 20 or more. So, my best advice is to just fight the urge to use gas and after a few times you will get used to it.

I hope this tips help you out. Like I said before, I think I would have done better had I remembered every single time I was driving. But, driving takes your undivided attention, so I recommend starting out with routes that you travel very often first, then adding irregular routes. A distracted driver (even by something like hypermiling) can be a dangerous thing on the road!! Keep that in mind and enjoy your new found MPG increases!!

ADD YOUR TIPS HERE!! Get instant traffic to your blog by posting your tip via the Mr. Linky widget below. Don’t forget to follow the rules posted at the top of this post. Thanks!!

Thursday, July 3, 2008

Final Results- Hypermiling Experiment

Well, the numbers are in and have been carefully calculated using a special formula. Ok, so not that complicated just miles divided by gallons. Anyway, my final MPG total is 22 MPG. Wha wha wha…. Actually it isn’t that bad. If I figure that I was getting 20 to 21 MPG a few years ago (the last time I checked) this means on average I am getting an extra 1-2 miles per gallon of gasoline. My tank holds at least 16 gallons so that is 16-32 extra miles on each tank of gas.

However I suspect it may be more than that. It has been a good three years since I calculated my MPG. I know as cars age they lose some of their performance so now I am going to try to drive as I normally do on this next tank of gas and see how my MPG changes. I will update on that when it happens. It may be a couple weeks though. I don’t plan on driving much in the next couple weeks.

Another thing to add to the mix- I didn’t hypermile the whole tank. I will write more about that tomorrow, but the main point is, hypermiling ain’t easy!

One thing IS for certain though. This tank of gas lasted me longer than any fill up in the past several years. That has to mean something. Had I waited until tomorrow to fill up it would have been exactly two weeks. This completely changed my financial situation last month. I was expecting to have to use $60 from savings for an extra tank of gas, but I didn’t have to. That rocks!!

Final opinion… It definitely works. I just think I have been getting way less MPG than I has first posted (20-21) based on calculations from a few years ago. Still, it takes work and for some it may not be worth it.

Can I Just Say......

How cool was it that one of Dave Ramsey's web people helped me last week! I feel somehow closer to being debt free now..... lol j/k!!

Wednesday, July 2, 2008

How are you all so early in the morning?

This is just a test post to see what is going to happen with some changes I made via Feedburner. I just didn't want to put a true "test" post up there. So I just thought I would say hello... instead of "testing".

I really appreciate all those who subscribe and read and comment on this blog!! You all ROCK!!! Ok, now to submit this and make sure my blog doesn't go all topsy turvy again.

Get Your Links Added -------->

I am getting ready to update my blogroll. There are some there that I don't really read anymore, some that I no longer agree with, and some I plan on keeping. However, I only do this once in a blue moon. And, once I get it all done, I won't be doing it again for some time.

SO, if you have a personal finance blog, or other productivity blog etc. Feel free to leave a comment and I will check it out.

I am going to follow in the footsteps of BostonGal and ask that if you want to be added you already have a link to Pic of Wealth. So, leave a comment or send me an email (see my new address added at the top there) and I will get back to you. I will probably work on this Sat. or Sun. so get those links in!!!

Defining Debt Free

Shelby T recently asked in a comment:

Have you thought about how you would define "debt-free"? I have been asking everyone I am comfortable with, and have recieved some interesting theories and opinion...especially with married couples.

My thoughts on this would be too much for a comment response, but this is a great question so I thought it deserved a post all its own.

There is really only one "true" definition of being debt free. That is not owing anyone any money at all. Pretty simple. However, the definition of "debt free" is really not that simple. My definition of it is being at a point where you can begin to save or invest. Meaning, you have paid most of your debt down to a point where you are able to pay more than the minimums and still have room to save or invest for retirement.

There are still MORE definitions of that though. The Dave Ramsey definition would be having all debt paid except for your mortgage. At this point, according to his plan, you are debt free. I tend to agree here. A mortgage takes a while to pay off whether you are paying more than the minimum or not. And, at this point many people are able to pay more than just the minimum and still save or invest. So, for most people, this is a good definition of being debt free.

In my case, I will drop it down another notch. For me, debt free will be when I have paid off all of my debt except for my student loans. I have two reasons for this. First, my student loan debt is at 4% and I feel I could get better than 4% returns on my retirement savings. I recently stopped saving into retirement, but I will start up again when I have nothing left but student loans. The second reason for this is that I qualify to have $5000 of my loans paid back when I have been a teacher for 5 years (two and a half years away). I am not 100% sure I still qualify because my job title has changed but technically I am still a certified teacher. So, I will see when I get to that point, but no reason in me paying off all that money if I could simply have it forgiven.

When I get to that point, I will still be able to pay more than the minimum on my loans while investing in retirment. When the loans are finally paid off, then I will begin saving for 3-6 months worth of salary. My plan is a little backward from Ramsey's babysteps, but it is what I feel comfortable with.

So, a definition of being debt free is a very personal definition. Of course we have the literal definition, but few people truly follow that. It really depends on someone's personal situation. That is the reason there are so many answers to this question.

I will finish by saying this. I believe all debt is bad debt. You never know what is going to happen in life and the less you "owe" the better off you are. In my case I will still try to pay off my loans as quickly as I can and I believe those with mortgages should do the same. I know many people after Katrina who were making payments on slabs... so get that debt paid off. Then you can truly be debt free and no one can question your definition! :)

Tuesday, July 1, 2008

It's All About the End Result

Today I was reading back through the journal I have kept over the past year. I am the type of person who HAS to get things out of my head or they drive me crazy and keep me up at night. One thing struck me today as I read and I thought I would share.

I was actually referring to cleaning house and other chores, but the statement I made was no one does these things for the pleasure of doing them. We do things like cleaning or going without "toys" for the outcome. A clean house or debt free finances.

If you are like me and are not going out to dinner or movies etc, this may help you stay motivated. You are not doing without because you like it. You are doing this so that later you can be debt free. It gave me a little motivation today. Hopefully, it does the same for you!

Saturday, June 28, 2008

Gasoline Experiment Update 2

Well, I would love to let you know my MPG.... only one problem. I haven't run out of gas yet!! I still have just under a half a tank left. I have driven about 220 miles so far. I am not driving as much as I did last week, but it is only a difference of maybe 50 miles. So, I can't give you a real update at this point except to say the last time my gas lasted over 8 days I was probably on vacation!!! I expect I will need to fill up Tuesday or Wednesday of next week. I will give another update as soon as I do. But, for now, I would say Hypermiling IS real. It works. I just can't say by how much yet.

Friday, June 27, 2008

Dave Ramsey Fixed My Blog!!

Well, not Dave himself, but Jeremy from his web team helped me find the problem this morning. Turns out it was NOT the Dave Widget but actually my feedburner script. I am not sure why it didn't happen until after I added that widget, but I am just glad it is working right now.

However, I am still having problems. My Linkies were working fine yesterday and now they are giving me problems. Also, my header will not move back into place. I wanted to change to another template but when I view that one the sidebar is doing the same thing. So.... I am not sure when things will be 100% back to normal. But thank you for bearing with me!!!

This Site is Experiencing Technical Difficulties

Please bear with me while I get everything taken care of. I will update on the problems as soon as I get it all figured out.

Thank you for your patience.

Thursday, June 26, 2008

Financial Tip Friday

Hi! Welcome to Financial Tip Friday. I hope you will create your own post and add it to the list at the bottom. If you found this post after Friday, that is okay you can still add a link to your blog.

I wanted to get very basic for my first tip. I often surf other personal finance blogs and I notice that a lot of them have gotten away from simple debt reduction tips and often post things that I don't even find relevant to personal finance. So, this is for those newbies trying to get their finances in order.

The tip for today is, if you are in debt, stop borrowing now! Stop using your credit cards, don't take out any more loans just STOP!!

It may sound impossible but last year I did just that. I honestly thought we NEEDED our credit cards to live. I had started reading Dave Ramsey's Total Money Makeover (see sidebar) and I finally got the courage to cut up my cards. I chopped them all to pieces. I was expecting to feel really anxious after doing that, but instead I got really calm. The stress was gone. I COULD NOT use them anymore. I COULD NOT create any more debt!!! It was great. So, my tip... if you haven't done so yet, STOP CREATING MORE DEBT.

Please share your tips!!! Add a link to your post on a financial tip here. Add the link to your POST not your blog homepage. (That way if someone sees this post two weeks from now they can see your post.) Also, provide a link back to this blog and mention Financial Tip Friday! That is all. It is a simple way to get some readers to your blog!!

Frugal Friday- Frugal Baby Tips

This post is part of Frugal Friday hosted by Crystal aka MoneySavingMom. You can find all of the other posts here at her blog.

I wanted to share a few frugal baby tips. With my older children one thing I always did was buy a pack of cloth diapers. Not to use as diapers but for burp cloths. It may be a regional thing, but everyone I know does this. Well, this time I skipped the purchase. I just used hand towels instead. They are larger and they catch more of the "yucky" stuff. I think a pack of cloth diapers runs around $10 now. So that is money saved!!

Try a generic formula if your baby is not too sensitive to them. We use Parent's Choice from Walmart. It has the same ingredients as Enfamil, but cost over 50% less than Enfamil. Even with the coupons Enfamil sends me, I can't beat Walmart's price. I have also continued to breastfeed in the early morning and at night saving even more money!!

For this baby, who turns three months TODAY, we have reused a lot of our three year old's old baby stuff. If you can't do this, try yard sales or consignment shop. Let someone else take the huge hit on buying the item new and get a good quality item for much less!!!

One more tip, this one has nothing to do with being frugal, but I think it is the best advice anyone has ever given me... When you make up baby's crib, put on a mattress pad and a fitted sheet. All ready to go, BUT THEN, put on another mattress pad and another sheet! This way if baby has an "accident" that ruins the top sheet at 2am, all you have to do is pull off the top two layers and everyone gets to go right back to bed!!

Do you have a financial tip that you would like to share? Today is Financial Tip Friday at Picture of Wealth. Join in here!

Dave Ramsey Ruined My Blog!!

I absolutely hate this template. However, it is the only one that does not stick my sidebar at the bottom of the page. This thing is so cramped. I hate hate hate it. Yes, Dave Ramsey really did this to my blog!! I was trying to add his widget that allows you to take a little financial check up and it is what caused my side bar to relocate itself. Now I can't get it to fix itself no matter what I do. I have tried putting one thing back at a time but it doesn't work. I am wondering if it might be a feedburner script or something causing the problem too but I just don't know enough about templates to figure it out. If anyone knows how to fix this I would appreciate the help, but for now I am stuck with this cramped ugly template... sorry!!!

More Stupid Things Jen Does

I have been paying an extra $36 a year for my insurance. I am not sure how long, but I would say for at least the last 5 years. So let’s see, that is 180 dollars I think? Yeah, that is stupid. The reason? My insurance company charges me to bill me. So I pay an extra $3 a month because I get a paper bill.

I actually find it hard to believe that it is legal to do this, but apparently it is. That is on my list of things to do this week. STOP paying that extra three dollars a month by switching to automatic deduction.

Do YOU have a bill that charges you for billing? You should check your next statement. You may have charges you are not aware of.

Wednesday, June 25, 2008

Opportunity for Personal Finance Bloggers

Starting this Friday I am going to host my own little "carnival". It is open to ANY personal finance blogger OR any blogger who wishes to post a financial tip. The name of the carnival will be Financial Tip Friday. On Friday you just post something that is helpful to others. Mention Financial Tip Friday and provide a link back to this blog. At the bottom of my Financial Tip Friday post there will be a Mr. Linky widget. You just give your post a name, submit the link and your link will appear on the list. Be sure to tell your readers about it so they can add a post as well. I will try this for a few weeks and see how things go.

Try it now....I have added a Mr. Linky Widget below. You can add your link to any post on your blog for this little trial. I just want people to see how it works.

One Step Ahead of the Joneses

My husband and I recently had a conversation where he said for Christmas he wanted to buy our daughter something for Christmas that would make all the other kids on the street jealous. See, this past Christmas she got a scooter and in the last month about 4 other kids have gotten them too. These other kids have not had birthdays or any other reason to get a scooter. I guess their parents just finally gave in to the constant begging. It was never our intention to make anyone jealous, but my husband is just having a ball with this.

I told him NO we would not be doing that because we were not playing "keeping up with the Joneses". He thought this was NOT the same thing because he would be buying it first!!!

I couldn't even believe my ears, but now I understand some of his ideas a little better. Keeping up with the Joneses does not mean you buy something because your neighbor has it, it means you are buying things to impress people who you could care less about. No thank you.

We still have several months to go until Christmas so I am sure I will be hearing more about it. I know she will get some good toys, but we are not going to buy her anything to make other kids jealous. My post on Monday explained that best.

Tuesday, June 24, 2008

Savings for the Tax- Refund-less

Sunday, I talked about changing my W4 and the fact that we would no longer be able to use our refund to pay off our house taxes. Yearly expenses like this are pretty easy to save for so they don't hit you like a ton of bricks. I like Dave Ramsey's statement, "Christmas is NOT an emergency." Nope, it is every year on Dec. 25th, just like our taxes on our home are due each year on Feb. 1. However, expenses like these have always had a tendency to slap us in the face. Like we weren't expecting them.

Truth is we were just being irresponsible. So, what do you need to do to prepare for such expenses?

What are your yearly expenses? Ours are real estate taxes, vehicle taxes, flood insurance, and you could add holidays like Christmas if you are so inclined.

How much is the grand total? Add up all of the expenses. Let's say for the sake of simple math, that our total bill comes to $2,400. That is how much we need to have saved each year in order to pay these bills.

How much per month? Take your grand total. In our case $2400 and divide it by 12. (That being the number of months in a year, just in case.... you never know what might confuse folks). Therefore, our monthly savings must equal $200. If we save this amount each month, we will have the money as each "event" rolls around.

Don't worry!! You will probably never actually see $2400 in the account, but that is okay. Since you continue to save this amount each month when it gets used up by an "event" the total in the account is going to go down. Maybe even to a level lower than the next bill that is due. However, if you have enough months between you and the next bill, the money should be saved up in time for the next "event" (don't ask why I keep putting that in quotes, I just do).

So, this is saving for recurrent yearly expenses for those of us who don't get a tax refund.

** On a way off topic, topic, can I just say I hate being an adult sometimes. I hate saving money each month that I don't get to play with later. At the same time, I am really glad I have finally woken up and started being responsible with my money!! ** End off topic, topic.

Monday, June 23, 2008

Can I Get Some More Input?

On the visibility of my blog. Can you read it? I had a reader who could not. Are the colors merging together? Is the sidebar where it belongs? It looks fine to me, but I want to make sure you can all see it. Thanks!!

Gas Experiment Update

I realized I never actually said what my mileage had been before the experiment. I was getting 20-21 MPG. My tank is a little over 15 gallons so roughly 300 miles on a tank of gas. (I think... not really in a math mood today :)

Anyway, at this point I have driven about 70 miles and my needle has moved a little over 1/16th of a tank. I know this is not a really accurate way to measure anything, but I think it is much better than I normally do. At this rate I may not be able to use all the gas in one week!! I only have two more days of work this week, so we will have to see.

If you are interested in this is a good website to check out.

I tried using cruise control today (supposedly saves gas because it accelerates much slower) the only problem with it is going downhill it will put the brakes on. This will take away from your gas mileage so if you use cruise be sure to tap the brakes anytime it tries to slow you down.

I have a feeling the biggest helper is slowing down on the interstate. I just watch all those people fly by me and think... "Wow, they must be rich to be using all that gas!" LOL

What Do You Tell Your Kids About Money?

We talk to our kids about not smoking, drinking and taking drugs. At least my parents did, and that is one major reason I never tried drugs. I knew their expectations. But, do your children know how you feel about money? What about credit cards? If you think they teach this kind of thing in today’s public schools you are sadly (very sadly) mistaken.

So, when do you start talking to them about it? And what do you say? Well, let’s start with what you should NOT say…

My parents never spoke directly to me about money. However, I did get the, “No, we can’t afford it,” speech more than once. This made me fearful that we were one step away from living on the streets. So, if you haven’t spoken to them specifically about money, watch what you say indirectly. I like my husband’s phrase, “We could buy that, but we choose to spend our money on other things.” That is a MUCH more secure statement.

A lot of what you say will depend on the ages and maturity level of your children. You may have a child who just really doesn’t care and will not sit through a lecture. In this case, just hit them up every once in a while with something like, “Don’t open a credit card, they will steal all of your money.”(Sounds dramatic, but you are trying to spark interest) Maybe eventually one of these statements will be a springboard into a longer discussion on money.

I have recently started talking to my 11 year old about credit cards. I told her that if she can’t afford something with the cash she has that she should not buy the item. We talked about how they work, and how you could end up paying three times the original price of an item if you keep a balance on the card and have a high interest rate. I also told her about my experience and how I am now trying to pay for things that I no longer have, don’t remember buying, and have probably already used up or thrown away.

It is getting through to her? I won’t know for a long time. But, in my opinion starting now is much better than waiting until there is already a problem. I am looking for books on money that can show kids how saving can make them wealthy. I don’t want her to have to repeat my mistakes. I hope she can learn from them. Of course she will make some of her own money blunders, but part of my problem was lack of an education about credit, savings, and how it all works.

Talking about money does not take a lot of time. It makes great driving discussion. Just use caution with what you say and make sure they know that you are NOT standing with one foot in the poor house (even if you really are).

Do you have specific advice for talking to certain age children? What have you told your own kids? I’d love to hear about it!!

Sunday, June 22, 2008

New Look!

I hope this does not confuse anyone. You ARE at Picture of Wealth. I had to change my template because Blogger had moved my sidebar to the bottom of the page. I don't know why, but with the template I had, it would not go back to normal. This one is more cramped but for some reason it works. Go figure.

Cash Crate Paid!!!

I got my first check from Cash Crate!! It was for a little over $10. My plan for money like this is to use it to snowflake the mess out of my debt. I am still waiting on a couple of rebate checks that will go toward the same thing.

Please read more about Cash Crate HERE before signing up.

Does a Yearly Tax Refund Make You Financially Irresponsible?

I never thought a person could enable himself or herself. It is possible though. I did it for many years. Even though I carried around a credit card with a balance of a few thousand dollars every year, I never saw myself as being in debt. (In case you didn't read yesterday's post, this is a direct example of being in denial)

The reason I didn't consider it debt was because each year in January I would do my taxes, get my refund, and pay off all of that debt. In my mind, it was not debt because it would be paid off before February 1st each year.

Then came the year when there was something more pressing than paying off my debt. I don't remember what it was. It may have been the bills from my toddler's birth. I hadn't saved for that like I did for this baby and they caught us off guard. (Doesn't insurance pay for all of that, ha ha.) Suddenly my refund did not go toward my debt. Do you think I changed my ways? Nope. It was a habit now. I had to use those cards every month because we needed groceries etc. In all honesty we could have done without a lot of the "groceries". When you shop at Wal-mart for everything a video game is considered "groceries".

It took a long time for me to realize that the tax refund had actually been enabling me. As well as costing me a lot of extra money. Think about this. I was paying around 10% interest each month on the card, so the government was collecting interest on my money all year long while they "held" it for me. On top of that, I was paying back the credit card companies for the items I had purchased, but I was also paying for being allowed to "hold" their money for a year.

How stupid! What I should have been doing was changing my W4, and holding my own money and making my own interest. Hindsight is 20/20 I guess.

Even after realizing all of this it has taken until recently for me to actually change my W4. This is going to do a lot for me and for my debt repayment efforts. I will be able to pay off my debt sooner, and I will not be paying as much in interest while "waiting" all year to get my own money back.

It is astounding how many people use this for savings. It truly is the worst savings account in the world. But, if you need to be enabled it is just perfect. Things will have to change though because in the past we have also used it to pay our house taxes at the beginning of each year. We must now create a savings plan just for that, which I will talk more about tomorrow.

So what do you think? A lot of people realize they are getting no interest and giving the government in essence an interest free loan, but they like it this way. What do you do?

Saturday, June 21, 2008

The Debt/Weight Loss Connection

I remember a long time ago an article I read. Basically it said that many people with debt had weight issues as well. I don’t think it was trying to say that if you aren’t good with money that you aren’t good with food. I think it was more along the lines of you are in debt and are turning to food in response. However, I find it funny that I see these things linked up quite often.

Take Total Money Makeover for example. Dave Ramsey spends an entire chapter comparing someone trying to get out of debt and someone trying to lose weight. It really is striking how similar the two processes are.

Denial. I think this is the chapter in which Ramsey first talks about the comparison. It really is true. Weight denial usually comes in the form of, “Well, it is only 3 pounds. I just won’t gain any more.” Debt denial is very similar. “Well, just one more outfit charged to my card won’t hurt.” You have to get passed the denial in both situations before you can do anything. That small amount of denial about your situation just builds on itself, until the pounds are up to 30 and the debt is thirty grand.

Obstacles. The next thing is getting to know your obstacles. For weight loss, if you keep buying cookies for “your kids”, you know you won’t be able to resist and you will blow your diet. (I use this example because…. Fine, I bought cookies this week!) Think of the obstacles with debt. If you keep your credit cards around when you are not 100% sure you can live without them you are going to use them. Identifying the things that will cause you to fail is key because what you don’t know WILL hurt you.

As a side note, this was my major problem to stopping debt spending. I really believed we could not make it a month without some help from my credit card. It took me cutting them up to realize that we could. Try it!

Planning. With Total Money Makeover you use baby steps and a debt snowball to fix your finances. For weight loss, you obviously must cut calories and then start exercising. I like to think about snacks now as how I am “spending” my calories for that day. If I go over budget, so does my waistline!! Exercising is kind of like saving. You are in essence banking calories that can be used later. No exercise, no room for extra spending. The exercise in your finances is working out those debts. Until they are gone you have no room for extra spending with real money either.

Goals. Financial goals and weight loss goals are easy to write down and track. However your goals have to have a deeper meaning. The end result should actually be a healthier lifestyle physically and financially. It takes commitment and putting what works in practice consistently. If you stop taking care of yourself or your finances you are bound to wind up right back where you started. That is the key.

I have started using some of the TMM ideas toward getting in shape… if you can’t already tell. It helps me feel like I am doing something while trying to get my finances in order. One thing that has finally become clear to me is the final step I talked about. This is a lifestyle change. It is not just a process you go through once and you are done. Weight loss for it to be permanent must work the same way.

Friday, June 20, 2008

Thanks Reader Shelby T.!!!

Recently, in a comment, Shelby asked how I was doing with my debt repayment. I knew it was lower, but I thought perhaps I had made a mistake in my calculations because it was thousands of dollars lower than I thought it should be.

Well, I decided to figure it up. I subscribed to NetworthIQ last year so I had the exact figures from August of 2007. Since then I have paid off around $6000 of debt! Maybe that is not a lot for a whole year, but considering that was the exact time when I stopped my debt snowball and started saving for the baby I think it is quite good!

On top of that my net worth has improved. At the time I last checked it was -$21,000 it is now -$12000. So it has increased $9000 even though it is still in the negative. I think that is really awesome for one year. That of course comes from retirement savings and the savings that were to go toward the hospital bills.

Anyway, this gave me a nice little pick me up. So, thanks for your question Shelby!!

Gasoline Experiment

Lately I have been experimenting with changing up my driving habits a little. I haven’t tried to do a full blown experiment, but today I decided to try just that. After my trip to work and back, I realized my gas needle, which usually changes by about an eighth of a tank, had hardly moved at all.

So I filled up my tank and I am going to try all of my little tricks out for the next week. Here are my plans, and also some cautions if you plan to try any of this.

Slower Acceleration

Pretty self explanatory. When coming from a dead stop I will accelerate more slowly. (Just in case you did need an explanation!)

There are not a lot of hills in my area, but today I noticed two on my way home. I took my foot off the gas about 25 yards before the hill and coasted down. It added 5 mpg to my speed and I was able to get up the next hill to the stop sign without adding any more gas.

I have started coasting as soon as I see lights turn to amber, before curves, and up to stop signs (and obviously on hills as prev. mentioned.). In the past, my habit was to stay on the gas and brake hard at the stop. This caused me to use more gas and lose all that energy when I suddenly stopped. This new way means that I stop using gas at the beginning of the coast, and lose less energy when I have to stop.

Speed Limit- Speed Reduction

I am doing the speed limit on all streets now and if I get behind a slow car, I STAY behind them. This is probably going to be the hardest thing for me because I am really used to going 5-10 MPH over the posted limit… I know tsk, tsk.

I am also going to reduce my speed on the highway by 10 MPH. Actually it will be even more since I was going closer to 80 and will tune it down to 60 from now on. I recently read that you lose 5 MPG when you go 10 MPH over 55, and 5 MPG more for each 10 over that. If this is true, than this is where I will pick up the most extra mileage.

I have already realized I am going to have to keep a sharp eye out for other motorists. They will pass you because you are not going fast enough and pull out in front of you if they can make it. Keep an eye out for these folks.

Be cautious when coasting. I took a curve today after coasting to it and still needed to apply the brakes a bit more than I expected. When you coast it is a good idea to keep your foot on the brake NOT the accelerator because if you are startled you may romp down on the wrong pedal.


So far I found it really amazing how much speed can be picked up coasting on hills. I knew I would pick up some speed, but I didn’t expect it to get me up the next hill.

I also found out that I can start coasting about 100 yards from my street, apply the brakes to turn, and still make it to my house without adding any gas. I still had to use the brakes to turn into the drive and I am about the 8th house down on my street!!

Thursday, June 19, 2008

The Result of My Crisis Plan... Debt Free Baby

To discourage anyone from starting a Blogger blog I am leaving this picture like it is. Blogger is stupid and this is how my right side up picture came out.

BUT.... this post is about the fact that THIS is a debt free baby!!! Our plan gave us the money to be able to pay our bills in full, so no extra debt due to baby!! Yea!!

It is also to brag on my beautiful baby!!