Monday, July 14, 2014

Found change challenge

"Find a penny, pick it up, the rest of the day you'll have good luck"

A silly saying but good words to live by in my opinion.  I was out in the field for work the other day which involved me walking up and down a busy street in my town, cataloging the condition of the public right-of-way.  Over the course of the day I found a dime and three pennies.  The next morning I found a dime left over in the checkout at the U-scan and a penny in the parking lot when I went grocery shopping.  Yet another dime appeared on my walk around the neighborhood later that day.  It occurred to me that I find a lot of spare change as I walk around.

I asked S how much change he finds throughout the year and he says he rarely finds any. I don't think it's because I am extra lucky that I stumble across free money more than other people.  I think the following things lead me to find free change:

1. I notice it when I see it.  My sister used to call me hawk-eye when we were little because I could always find dropped earring backs, needles, and other tiny objects that get lost when dropped onto a busy backdrop.  But I don't think I have keener eyes than others, I think I just recognize the value in loose change where others would blindly pass over a spare penny because it is worth so little.

2. I go out of my way to pick up spare change.  It's one thing to notice dropped change, it's another thing to walk over and pick it up if it's not in your direct path.  I always go out of my way to pick up spare change.

3. There's no shame in my game.  I'm not embarrassed to pick up a penny on the road just because I happen to be walking with a co-worker or because it's on the floor in a busy grocery store.  

Sunday evening I decided to do a little found change challenge.  For the next year I'm not only going to pick up any loose change I randomly come across, I'm actually going to start looking for it (I'll do some posts along the way on ways to find spare change).  I'm going to set aside all this found change in a jar.  Next July I'll count up the change and see how much free money I can find in a year.  I've even convinced S to participate so hopefully he'll start keeping his eyes open for loose change too.

Thursday, July 10, 2014

Doing some late "spring" cleaning

Rounding up all our spare change last week put me in the purging mood and got me wondering how much money we have lying around in things we don't use/ need.  Over the next month I plan to go through the house with a fine tooth comb rooting out these unneeded objects and selling them via Ebay, Craigslist, and a large kids stuff consignment sale I will be participating in next month.  

I made an initial sweep this past weekend and currently have the following stuff listed on Craigslist and Ebay:

- Baby stuff including a large automatic swing, a floor mat entertainer, a carrier, and some maternity stuff: this is just the big ticket stuff, I have boxes and boxes of smaller value stuff that I will sell at the consignment sale a month from now.
- A futon frame: we're keeping the mattress but honestly it's so much more comfortable on the floor than on this metal futon frame... besides the mattress on the floor just adds to the Japanese motif the guest room seems to be taking on.
- Video games: yep, I like to play video games (which I buy used) but with two toddlers I almost never get to play and the likelyhood of me going back and replaying ones I've already beaten is pretty slim.
- Wedding dress: not going to use it again and I had two boys soooo... do I really need to hang onto it?

Obviously I don't know if all of the stuff listed will sell or how much it will sell for but if everything sold for a price around what I expect there is $450 in unneeded stuff lying around the house.  I'll be keeping track of everything I "find" over the next month to get rid of and how much it sold for.  Once the kids consignment sale is over I'll write a post on how much money we had lying around in unused stuff.

Thursday, July 3, 2014

Counting the coin jar

Last week I was catching up on one of my favorite blogs,  In one post the writer mentioned it was time to go around the house and collect all the spare money which he estimated would be between $60-90 bucks (accumulated over the past few months).  My initial reaction to reading this was “Yikes, how could someone have that much lying around and not know about it!” $90 (even $60) seems like a lot of money to me these days and I feel like over the past few years I have become so much more aware of where my money is, how much is being saved/ spent, and what every nickel is working towards.  But then I started wondering… how much money do we have just lying around in coin?  Is it possible we have that much in loose change?

This past weekend I went around the house collecting all our change.  There’s a bowl in the kitchen and on S’ dresser for collecting spare change.  We also have two little piggy banks in the boys room that we got as party favors at a baby shower that we sometimes put change into as a demonstration to our boys the importance of saving.  I dumped my coin purse and the little stash of quarters I keep in the cars for meters.  I also rooted through the cars, couch cushions, and picked up a few stray pennies randomly located throughout the house as I cleaned.  On a roll, I went through all our coat pockets and extra wallets/ purses.  

The final tally $33.08 plus a shiny golden 20 cent Euro.  I was honestly surprised that it came to that much.  I always try to use exact change and even empty my coin purse into the self scan checkout whenever there's not a line behind me.  S' dips into the coin jar for a gourmet coffee treat every once in a while and we always use quarters up at the meters downtown.  Also we only use cash for our discretionary spending, the small amount of pocket cash we get each week and for our monthly household random expenses.  Everything else is paid for either through online auto pays and bill pay or by debit card.  I can imagine if we were an all cash family that number would easily be double, possibly even triple.

It wasn't till I went to roll up the loot and couldn't find our coin sleeves that I realized that there's a gallon ziplock baggie still packed somewhere with all our pre-move coins (and the sleeves).  Eventually we'll get the rest of our stuff unpacked (why we even have so much stuff that we can have it sitting in boxes for three months and not need it is a whole other story) and we'll find the mystery money.  But for now, I just walked over to the bank on my lunch break to get some more sleeves... and found a dime on sidewalk, bringing our total to $33.18!  

Update: Found the missing bag o' change... add another $1.72 to the total loose money tally we had lying around our house.

Tuesday, July 1, 2014

2nd Quarter 2014

Starting point:

Student Loan 1 (My fed loan): $38,339
Student Loan 2 (S' state loan): $21,719
Student Loan 3 (S' fed loan): $5,454
Car Loan: $11,684
Credit Card 1: $10,577
Credit Card 2: $3,635
Credit Card 3: $0
Misc. small debts (S' small debts in collections): $5,443
Medical expenses: $3,672
Parents: $600

Total: $101,123

And here's were we are today:

Student Loan 1: $35,251
Student Loan 2: $19,511
Student Loan 3: $295
Car Loan: $0
Credit Card 1: $0
Credit Card 2: $122
Credit Card 3: $6,212
Misc. small debts: $4,284
Medical expenses: $300
Parents: $0
Consolidation Loan: $9,865

Total: $75,840

Paid off to date: $24,402 paid off + $5 in savings

This past quarter was by far the worst we've had since we started the debt reduction journey. Not only did we increase our debt by $1,695 over the last three months but we also drained what was left of our emergency fund.  As bad as it looks to see it all laid out like this there are some positives coming out of the past quarter.  First and biggest, is S' student loan (#2 in the list) has officially been rehabilitated and is no longer in default.  The number shown was from his last statement but we don't know for sure what the current balance is because we are waiting to hear from the lender that bought his loan from the collections company.

Secondly, we consolidated the credit card debt we accumulated during the move on the 15.99% card with S' student loan #3 with a private 8.39% loan from Lending Club.  With a $300 loan fee, it cost more up front (and contributed to the increase in debt) but it will cost us less in the long run by not paying 15.99% interest on that credit card debt.  Unfortunately, I forgot to factor in that fee when requesting the amount of the loan so we still have a couple more payments on the student loan and credit card before we will be done.

It was a rough 3 months financially but as I posted recently, we've finally gotten our act together and should be back on track to continue our debt reduction journey.  Our first step is to build our emergency fund back up, which is targeted to be back to $1000 by the end of the next quarter.

Tuesday, June 10, 2014

Morale booster from unexpected source

It's no secret that I've been a little down on the debt front since we moved.  In my last post I talked about how we were getting back on track which was immensely helpful in regaining a positive feeling about our debt reduction efforts.  Something else happened last week that was also key to my turnaround in attitude...

Someone left me a comment on one of my posts!  The comment went something like this:  "Dear Person in Debt, I want to inform you of an amazing opportunity to borrow money at an insanely low interest rate from my top notch international firm."  Except the actual comment was full of improper grammar and misspellings. Sounds a little too good to be true and a little too much like the e-mails I get from time to time from royal foreigners who would like to send me millions of dollars for helping them with some small task.  (I did not publish the comment if you were wondering or looking for it, btw)

Anyhoo, why did that give me a morale boost, you ask?  Because it reminded me that my bottom was not as bad as it could have been.  I realized I had a problem before the problem got so out of control that I had missed payments, bankruptcy, ruined credit, collections, turned to cash advance places or shady loan propositions, or started hitting up relatives for loans (minus the small $600 my parents lent me).  Looking back I know I was on the brink of those things when I started this journey back in 2011.  I could have just as easily stayed on the path I was on.  In many ways staying on the path I had been on would have been way easier, changing my long ingrained habits and discovering uncomfortable truths about myself has been a difficult journey.  

It reminds me of something a friend once told me about struggling with addiction, she believed you didn't have to hit bottom to make a change, that the struggle was more like an elevator where you could choose to get off on any floor instead a free falling all the way to the sub-sub-basement.  Although her situation was different than mine, that analogy has stuck with me and seems fitting of my journey.  I'm thankful that I got off the elevator three years ago and have been "climbing the stairs" back up to the top floor ever since.  There will be times that I have to stop and take a breather but eventually I'll make it!

Wednesday, June 4, 2014

Getting back on track

Since the move in March we've been going through a lot of adjustments in our lives and specifically in our financial situation.  There have been plenty of hurdles but I think we're finally back on solid footing. Here's the run down of how we've getting back on track and how we're moving forward:

1. Consolidated the high interest credit card debt we racked up during the move/ adjustment period and S' higher interest student loan into one loan from Lending Club.  We were able to reduce the overall APR and, by going with a 5 year loan, reduce the monthly payment to this debt.  This allows us to allocate more of our budget to higher priority savings and debt reduction.

2. Put my student loan in forbearance.  This is our lowest interest rate debt at 2.5% but one of the largest minimum monthly payments, by putting it on hold we are able to put more each month to our higher priorities.

3. Lower medical bill payment. We're not paying any interest on the medical debt from the boys' birth and while it's super annoying to have this little $300 debt still hanging around, it's more important right now to focus efforts elsewhere.  I've heard somewhere that as long as you send something in, the medical billing won't send you to collections.  I'm hoping that's true because until the medical billing people tell me otherwise they are only getting a $25 payment each month!

4. Build up our emergency savings to $1000.  The three previous steps freed up an extra $330 to pour elsewhere.  By end of summer we should have our emergency fund re-established (barring any emergencies along the way!) and be ready to hit the debt hard.

5. Our first priority debt is the remaining $6,270 in credit card debt.  This debt was refinanced through a balance transfer last year to a 0% APR that expires in June of 2015.  Our goal is to have as much paid off before the interest rate goes back up to 8.99%.  I'm projecting that we should at least be able to pay off 60% of the debt before the rate hikes.  Once that rate expires we may look for another balance transfer offer or refinance it with the debt from step 1 above with a shorter repayment period/ lower interest rate or maybe we'll just keep paying it at the higher rate.  We'll examine all options and pick the lowest cost option next year.

Feels good to have a plan in place again!

Wednesday, May 28, 2014

Regrouping after the last year of monumental changes

This past year has been one of monumental changes (the babies, the move, S becoming a stay at home parent and trying to restart his business, the major unexpected expenses that have cropped up along the way) coupled with some extremely sad events including the passing of my uncle, S's uncle, and our beloved pup.  I'm not going to lie, I made some costly mistakes and have also caught myself resuming some of my past bad financial behaviors, especially during the move and transition to living in Kentucky.  But I can't dwell on those things I can't go back and change, and in retrospect, we have really dealt with a lot in the past year and mostly handled the finances well.

Since the move we have been scrambling to adjust to our new one income situation.  We've finally stopped the hemorrhaging of money that was rapidly increasing our debt and I feel like we've come up with a workable budget that will prevent us from accumulating any more debt this year.  My full time job income covers all of our regular monthly expenses which are:

Mandatory expenses (everything we absolutely must have):
  • Housing expenses: rent, renter’s insurance, utilities including our phones
  • Groceries and household expenses: food, toiletries, diapers, pet food
  • Cars: insurance and fuel
  • Health and Life Insurances
  • Debt: Student loans, credit cards and medical debts

Plus the following somewhat optional expenses (we could live without these in a pinch but it would be unwise/ difficult for us):
  • Emergency savings- this one is not really optional
  • Fun Fund money for the occasional lunch/ dinner out, beer, haircuts, clothes, or whatever (sometimes used for unexpected bills but mostly just to cover the extra "wants" we have)
  • Internet and Netflix- we could live without internet but it would be extremely hard to run our businesses which are mostly web based… and Netflix is a very inexpensive form of entertainment
  • YMCA membership- we could live without this one but it provides S a break in the day with the babies and supports a healthier lifestyle for us so we're sticking with it
My full time salary does NOT cover the one time expenses (my professional membership fees, some medical expenses we are expecting to have for the boys, etc) or anything beyond the minimum debt payments.  There are some additional sources of income I'm expecting this year including a end of year bonus, some reimbursements from taxes/ insurance paid in Massachusetts, and the sale of baby items which will hopefully cover the one-time expenses.  Plus my side businesses on Etsy are becoming more and more stable and bringing in a little extra cash each month.  S hopes to have his business up and running by the end of the year but may end up getting a small part time job to bring in a little cash and also get some adult socialization time.

In short, our plan for the rest of 2014 is to hold steady on our monthly expenses living off of my full time salary and whatever we can hustle up each month will go to savings to cover one time expenses and extra debt payments.  I can't say I'm feeling great that the debt reduction has taken such a backseat to just getting the bills paid but I do feel better than I have in months about where our finances stand.