Category Archives: Money

Savings Sense

*Click on image for source.

I’ve decided I need a new strategy when it comes to my savings.  We all know that I kind of suck at it.   The good news is that I can blame my parents for this — they aren’t great savers either (on their own, but their financial planner has whipped them into shape!) so it must be genetic.  For the past several months, I’ve been trying to save about 15% of my monthly income.  So I have the money automatically withdrawn from my checking and deposited into my savings account(s). Easy peasy, right? Well, I usually do really well with it for a couple of months . . . and then it’s so-and-so’s birthday and I have one of those excruciatingly long pay-periods that includes three weekends between paychecks and then Old Navy has a sale and . . . you get the picture.  Stuff happens, I want to spend money, I move the money back from savings to checking.  And trust me $50 here and $75 can suck up a lot of savings really quickly.

So I spent a little time last week looking over my budget, trying to figure out how to leave my savings money in my savings account.  Well, I realized that I wasn’t leaving my self a lot of flexible money in my current budget.  As someone who isn’t terribly disciplined with money to begin with, not having room to buy a couple new v-necks and contribute to the party for Miss H’s bday (woot woot!) just doesn’t work.  It’s not like I don’t have any money, but the way that it has been allocated has been setting me up to fail.

Time for a new plan.  I have decided to decrease the amount of money I am putting into savings every month from 15-17% to 10%.  I know, I know, some financial guru is having an aneurysm right now.  Saving more is always better, right?! Well, I feel like it isn’t better if I’m constantly taking the money back out of savings and putting it in my checking account.  At this point, I’m probably actually saving less than 10% a month just based on the number of transfers I’ve made over the last couple of months.  So 10% it is.  I know that in the big scheme of things 10% really isn’t a lot but I can wrap my head around 10% and at this point I think that is important.  If I can successfully save 10% per month for 6 months, I’ll reevaluate my plan.  Maybe I’ll get crazy and bump the monthly savings up to 11%.  Exciting stuff, huh?

Do you struggle with keeping your grubby little paws out of your savings account?  How much is “enough” to save each month?

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It’s always something…

…which means I seem to accumulate nothing. So as previously posted here and here, I am trying to clean up my finances this year. One of my major goals is to accumulate some savings! Unfortunately, it seems like there’s always something that I have to save for and then I pay for it and my savings are back at nil, or close to it.

Things that have come up in the last few months: Dental visit ($125); Corneal Ulcer = 5 co-pays plus 3 prescriptions ($155); and Bridesmaid dress alterations ($120). Individually, none of those things is that big of a deal, but they all chip away at the extra $$$ I could be putting into my savings account each month. Plus, there are other expenses that are not part of my monthly budget that I’ve paid lately — Kickball registration ($63), Lake Membership Dues ($589), and OKC Half-Marathon Registration ($70) — but aren’t really necessities. Oh, and I probably need new tires soon ($400 – $500) and prescription sunglasses due to the corneal ulcer ($150).

I know what you’re thinking — um, hello! Re-prioritize! Well, in some ways, I have. I decided to forgo season football tickets this year even though I REALLY want them, my Netflix membership goes buh-bye on Sunday, and I stopped going out to lunch for Lent. Last year, I did all of those things PLUS paid the other unbudgeted items listed above. So see, I’ve made some progress, right?

But last year my lovely madre still paid for all of my teeth cleanings (Yahtzee!), I thankfully had no persistent health problems, and my tax return was far more amazing. It just seems like every year or month there is some different obstacle that is preventing me from accumulating any wealth. I mean, not even wealth, but just a small pile of green in case my car decides to bite the dust — this is one of my biggest fears right now (although, I’m not really sure why – my car is 8 years old and has a little less than 100,000 miles on it, where I come from, that is still new and gently used).

I know that part of my problem is that one of my savings accounts is directly linked to my checking account. I was totally sold by the convenient transfers and keep the change roll-overs. But the problem is the convenient transfers. It is WAY too easy to get money from my savings into my checking account. In fact, I made one such transfer this morning. Not okay. I’ve started putting a little money in a savings account that I have had since birth at another bank, but it is slow going. I’ve just never been good at saving. I can save for something specific — back to school clothes or a trip — but not just to have money available in the event of an emergency because that is the responsible thing to do.

I am trying to eat out less (serious struggle) and spend less money on stupid stuff (I am weaning myself off my weekend Target trips, buying magazines, and paying full price for books). But well, it just sucks. I guess admitting I have a problem saving is the first step to…well, hopefully doing a better job of putting money in savings and actually leaving it there. I seriously have little to no financial discipline.

Do you ever feel like you just can’t get ahead on saving money/planning for your future/retirement funds?

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To buy or not to buy? That really is the question.

Getting the keys to your first kingdom sounds oh so nice...

Buying a home has become a hot topic for quarter-lifers, or at least it has in the hip pocket of the Bible belt. (Okay, really, we’re in the buckle. I just wanted to say hip pocket really badly.) After all, it’s a buyer’s market, or at least that’s what they’re saying on GMA of late, and I’m not gonna lie, that $8500 tax credit sounds pretty sa-weet to me.

Many of my peers are taking the plunge into home ownership. In fact, since the tax credit became available, Mrs. Preppy, Mrs. V, Mrs. B, and Mrs. K Squared have all taken advantage of the benefit and bought their first homes. (Please note that all of the aforementioned friends have their “Mrs.” Cards.) It seems like buying now is the way to go, and I know some singles who have jumped in with all the married couples and made big purchases too. But some other people seem much more hesitant about making the big buy. And by some other people, I mean me.

"Free money" from Uncle Sam? Heck yes!

When the tax credit first became available, my dad, slum lord extraordinaire (aka owner of much rental property), was all over me to take advantage of the deal. Some of my co-workers encouraged me to start the house hunt as well. When I expressed my reservations, one of them said, “Oh, you must not need $8500 then.” Um, no, no, that’s not the case. I always need $8500. But the idea of buying a house…alone…well, it’s just not part of the fantasy. (For more on my unrealistic, juvenile life expectations see this post.) Buying a house by myself just didn’t seem as exciting or meaningful or special as the idea of buying it with a husband (or at the very a least long-term boyfriend) did.

I know, I know. I sound a little, well, pathetic. (Okay, maybe a lot.) But here’s the deal, to me buying a house is: 1) A HUGE commitment; 2) A life change, a new beginning; and 3) A TON of work. In order to conquer all of those things, a partner seems necessary. I know, i still sound pathetic so let’s break down my logic (or lack thereof as the case may be).

1) The Commitment

Despite what you may or may not have inferred from previous blog posts, I’m not a commitment-phobe in general. I think I am responsible and reasonable and I work very hard at keeping the commitments I make to my friends and my self. But committing to a mortgage? Well, that’s a whole other story. First of all, the financial burden completely terrifies me. As we have previously established, I am not a skilled money manager. I know that I could afford to spend more on housing than I currently do, but it seems like all of my money is going other places and I just don’t know how I could redirect it. It overwhelms me. Plus, buying a house seems like the ultimate step in the “settling down” process. Married or not, buying a house is committing to your current location, probably for a while. I really have no intention to move any time in the near future (or probably ever — I’m a total Tulsa hondo) but I enjoy the fact that if I CHOSE to pick up and move at a moment’s notice, I could. (Seriously, I don’t even have a rental lease. I could be out of here in no time flat.)

2) The Life Change

In my mind, buying a new house is a life changing experience. It signifies some kind of new beginning and a definite leap into adulthood. There is something big and important about it. Something that I always imagined I would share with a spouse. Yes, I’m that girl. Buying a house alone just sounds depressing. Don’t get me wrong, I like the idea of having more space (I not-so-lovingly refer to my current bedroom as the baby nursery because the only bed that fits in it appropriately would be a crib) and decorating things the way I want to and engaging in a few minor home improvement projects. That all sounds lovely. But it also sounds like something you just don’t do alone. Who wants to nest solo? And, I know this is going to sound really terrible, but it also feels like giving up on finding someone to share your life with. Dramatic, I know. To me buying a house will be a monumental occasion (if/when I ever get around to it) — I won’t be a renter, a transient, a child anymore. I will be an adult and homeowner and a true citizen. And in my head I have always imagined that important step in the American dream being taken with someone. Every body needs support to take the big steps and it seems like this one is being enough that I would need someone to share the burden.

3 The Work

OMG, the work. Let me just tell you what’s been going down at our lovely rental casa: this week our heater broke, we recently discovered that our hot water tank is on its last leg, and there seems to be some sort of roof leak in our dining room, as evidenced by the water streaks running down the wall. Yeah, if I owned this joint, I would be flipping out. I know what you’re thinking — you don’t have to buy that house. You buy a house in better condition. But that’s just it, you never really know the condition. Sure, everything checks out fine, passes inspection, and you think you’re good to go. And two months later, the AC bites the dust. It probably wasn’t foreseeable, it’s just part of the deal. And that part of the deal costs money. Plus, you’ve got to consider property taxes, yard expenses, regular maintenance, insurance, etc. It all adds up financially and in terms of time spent. I currently appreciate the luxury of calling the landlord and having him arrange for things to get fixed, on his dime and on his time. Plus, taking care of a house, no matter house small, and all that it would entail is a lot of work for little ole me. Me, as in the girl who struggles to keep her teeny, tiny bedroom clean and the yard mowed when it is her turn, every third week.

Taking on the responsibility of a house by myself is just more than I am ready for at this point. I love the idea of it and I’m completely jealous of my friends who have recently taken the plunge, but ultimately, it scares the crap out of me. I don’t think that I will always feel this way, with or with a significant other. I know eventually I will take the step and by the house and be a big girl and who knows, I may just decide I can handle it all on my own. But for right now, it definitely isn’t for me and as much as I love to dream of hardwood floors and porch swings, I will continue to be a semi-contented renter. So thanks, but no thanks, Uncle Sam. I really don’t need your $8,500.00.

Have you recently purchased a house? Or though about it? Was it as scary as I have made it out to be or am I just being a big baby?

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Young, Fabulous & Broke? Um, yes.

So last night I bought this book, The Money Book for the Young, Fabulous & Broke, by Suze Orman. Well, let’s back up, the reason I bought the book is because one of the things I want to work on in 2010 is taking better care of my finances. I am a horrible saver. Like, horrible. If I can see the money chilling in my savings account, I’m like, sweet, let’s go shopping. Not okay. And I spend money on stupid things all the time. I cannot go in Target without buying socks that I don’t need, a pack of pens and a drink. There goes another $10 down the drain on things that are just unnecessary. I know that eventually I will need a new car and want to buy a house and to do those things, I need to get in better financial shape. Enter Young, Fabulous, & Broke. (YF&B)

Basically, I think this book was written for me personally, after all I am young, clearly I’m fabulous, and most of the time I feel broke, which doesn’t make sense at all. Okay, probably not, but it was definitely written with my current life stage – young, new to the working world, in school debt, etc. – in mind. In the introduction, Orman describes what “broke” is — one of her scenarios was about getting nauseous every time you think about how long it will take you to pay off your student loans — that basically defines my life. YF&B covers FICO scores, savings, student loans, 401ks, home ownership — you know, all that stuff that people talk about but no one really feels like they truly understand. (Maybe you understand it, but if so, then you probably aren’t YF&B.)

I haven’t gotten into everything yet, but last night I read the chapter on FICO scores. Orman talked about what the score was, who uses it and why, and how to make yours better. She answered some reader questions/common scenarios and gave lots of examples. I felt like it was FICO for dummies, which I personally appreciated. Some of the info I already knew and some of it covered things I hadn’t thought about before.

The book also comes with access to the YF&B website which I checked out as well. You take about a 10 minute survey about your finances/current state of affairs and what your biggest financial worries are. Then Suze (and by Suze I mean the computer program) creates an Action Plan for you — Steps of what you need to do to conquer your financial world. So far, I’ve pledged to continue maxing my 401k match.

I’m excited to keep reading and figure out more things I can do to set my self up for a solid financial future. Right now I worry most about savings, my student loans, and planning for retirement. I love that someone out there is thinking about how big and scary and confusing it all is when you first start making your own money. It’s hard to know what to do with it all! And I really appreciated the fact that she didn’t say I needed to save 8 months of living expenses before I did anything else — that would take me like 5 years.

What financial issues overwhelm you? Do you worry about having adequate savings, planning for retirement and paying off your student loan debt?

PS – When I’m finished reading YF&B, I promise to post my overall thoughts on the book!

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