Archive for the ‘money’ Category

Dave Ramsey talks about “nerds” vs. “free spirits” when it comes to money management/budgeting.

While I definitely wouldn’t say that Jeff is a “free spirit”, he’s also not the “nerd” that I am.

Last Friday, I made an extra payment on our mortgage.

In the amount of $95.99.

Why?  Just to see the balance be $9,999.99.  Under $10K!  And as a bonus, it’s all 9s!



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No Spend November?

Most of us are probably familiar with “No Shave November” where men intentionally don’t shave for the month of November.  Sometimes, they do it for charity.  Sometimes, just cause.  (Course, I’ve heard that it also leads to Decembeard.)  But I’ve decided to participate in “No Spend November”.  Now, I decided this a little late – just today on the 4th, so it won’t be a whole month, but close enough.

What this means (for me):

  • The idea, for me, is to not spend money that I don’t have to.  Even if the money is budgeted.
  • If I can put a purchase off until another month, I’ll do so.
  • If I can make do with what’s in my pantry, I’ll do so.
  • If I can use a gift card instead of spending money, I’ll do so.

What this doesn’t mean (for me):

  • Impacting Jeff’s spending.  The man is good with his money and my goal isn’t to reduce his spending.
  • Saying no to family events that we normally do – like eating out after church on Sundays.

Really, this is motivated by the fact that October was an EXPENSIVE month for us.  With having a baby and moving into a new house, we had a lot of expenses.  Especially with the move.  One thing just lead to another (scope creep!)  I mean, you decide to paint before you move in, which means removing the wallpaper.  But you don’t have a lot of time, so you hire friends and family to help you remove the wallpaper.  Then you discover that the wallpaper was applied directly to the drywall (meaning the drywall had never been painted) and thus, removing the wallpaper = removing pieces of drywall.  So, you hire a drywaller to get the walls back into shape.

And, then since you have everything off the walls and ceilings (because you’re painting), you might as well replace the light fixtures anyway.  And you’ve discovered that your tall-but-not-gigantically-so husband can’t actually see himself in any of the bathroom mirrors.  So you have to move the mirrors up on the wall.  Meaning that you have to move the light fixtures up on the wall too.

And you discover that there isn’t an exhaust fan in your master bathroom.  You don’t know why – the other bathrooms have them.  But it basically creates a sauna in there every time you shower.  And that can’t be good for the walls.  Enter an electrician to install a fan.

And you’re walking through the furniture store to price carpet and see a really neat kitchen table.  One that can fit a bunch of people.  Or just a few.  And that would fit into your kitchen.  Must have!  Purchased!

So, our savings account is down a little more than we anticipated.  Not an emergency or anything, but I thought I’d use it as a way of motivating me to see how little I can spend this month.  It’s meant not buying new mirrors just yet – instead, I’ll wait and see if that’s what I really want to do.  It’s meant not buying new towels to use in the new bathroom.  It’s meant looking at the freezer and pantry for meal inspirations.  It’s meant not driving through the drive through for a soft shell chicken taco.

Hello No Spend November!


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Life Hacks: Automatic Payments

I was reading another gal’s blog and it was dedicated to how she manages her family’s mail.  She had a system for filing mail away and paying bills that worked for her family, but, to me, it seemed really complicated.  I also see lots of “family command centers” on pinterest that women use for doing similar things – managing the paper that comes into the house.  The command centers are really cute, but I just can’t see how they’d be useful to me.

I thought about it and realized that it’s because 95% of our bills are set up on automatic payments.  My bank is set up to send the utility companies a check once a month.  Same with the cell phone bill.  Same with the money we give to charities.

Our retirement accounts pull from our checking account or our paychecks each month.  The DiscoverCard that we carry pulls the full statement amount each month from our checking account.  We use Quicken to automatically import our transactions and produce a spending report each month – that feeds an Excel spreadsheet that I keep.  I probably spend 2 hours/month on financial things.

So when mail comes in each day, I just open it, make sure the amount seems right, make sure that they’re set up to pull the right amount and then put it in the “To Shred” pile.  Maybe 2-3 times a month will I need to actually take the bill and make a payment.  We only have 1 magazine subscription, so on a typical day we get 1 bill and 3 pieces of junk mail.  It’s fairly easy to come up with.

When our kids get older, I’m sure we’ll have more paper to process – forms to fill out and the like that need to go back and forth to school.  Maybe it will be then that we need a “Command Center”.

What else do people have to manage with their Command Centers?  Why don’t more people like automatic payments?

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Okay, another post on the things that I learned/was impressed by in the series of Thomas J. Stanley’s books that I finished reading not too long ago.  (They include: The Millionaire Next Door: The Surprising Secrets of America’s Wealthy, The Millionaire Mind, and Stop Acting Rich…And Start Living Like A Real Millionaire).  This time, it’s on the fact that most millionaires aren’t DIY (Do It Yourself-ers).

Although most true millionaires are frugal people (considering their income), most millionaires don’t do many DIY projects – like landscaping or carpentry or fixing up houses.  Seems kind of strange since doing things yourself is usually a cheaper option than hiring someone else to do the work for you.  But that isn’t necessarily true – for this group of people, anyway.

  • Since they typically have higher incomes, it’s more cost efficient to hire a handyman at $25.00/hour than for them to do the work.  Reason? They can spend that hour making money and they’ll make far more than $25.
  • Additionally, since the millionaire isn’t likely skilled in that area or have tools for the job, a professional can do in 1 hour what might take them 3-4 hours to do.

The exception is if the millionaire likes to do that kind of work.  Some millionaires like building things or landscaping.  For them?  They’ll do the work themselves – not motivated by saving money, but motivated by spending their down time doing what they enjoy.

For us, we don’t DIY much.  Some, but not much.

  • I do our own decorating painting, but when we moved into our house, I hired someone to paint all the walls.  They could just do it much faster than I could and had the right experience for a bigger job like a whole house.  My time was better spent packing and coordinating everything else.
  • I did install our own ‘board & batten’ looking thing in our back entryway.
  • I do our own landscaping, but honestly?  To call it landscaping is quite a stretch!  It’s just grass and some hosta plants.

So, see!  I already act like a millionaire when it comes to DIY projects.  There’s just 1 problem: We’re not millionaires!  Which, since I’m not, I do want to do more DIY stuff, but mostly just the things that would save us money (ie: there’s no sense in me learning to re-plumb a house when I’m more likely to cause damage than to fix damage!) or things that interest me (like the board & batten type project).

I guess this is a good time to learn this – we just bought a new house this weekend!  We don’t close until end of September, but this is a house that will have lots of opportunities for me to DIY some things (should I decide to!)

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This House is Just Right

At least one more thought on the books I finished by Thomas J. Stanley on millionaires. (They include: The Millionaire Next Door: The Surprising Secrets of America’s Wealthy, The Millionaire Mind, and Stop Acting Rich…And Start Living Like A Real Millionaire).

In all of Stanley’s research on the wealthy, he found that there’s an interesting relationship between someone’s income and the cost of their house. You might think higher income = more expensive house. And that’s true in a lot of cases.

Take one of the neighborhoods in your city and you’re likely to find a lot of the people that live there have big incomes (think hundreds of thousands dollars a year – maybe even a million dollars year).

Many people who want to seem wealthy, buy big houses. But there are problems with that. Bigger houses mean not just a larger purchase price, but they also mean more maintenance expenses. And you’re likely surrounded by neighbors that also spend as if they are wealthy. That means private schools, boats, cleaning services, fancy furnishings, faster cars.

It’s not that you’re required to do those things, it’s just that you’re in a pool of people who do those things and thus, you’re more tempted to think that’s normal. People expect it of you.

And doing all those things require money. So you make lots of money, but you spend lots of money too.

But if you step down a notch or two and go to less expensive (but quality built homes), and that’s where you’ll find the real millionaires. Some of them even live in the same neighborhoods that they did as children. Few people know that they’re wealthy and, so, there is no pressure to keep up. Public schools are good schools. No one else has a boat, so why would they? They can clean their own house, mow their own yards and why replace perfectly good couches and bedroom sets just because they aren’t new? If you buy a good car like a Toyota Camry, it’ll last at least a decade. It’s quite roomy too!

He found housing costs to be correlated with wealth. The more wealthy a person truly is, the less of their wealth they’ll spend on their housing. They know the value of quality and safety and, more importantly, good enough.

It made me appreciate the house that we have (even more). Conventional thinking out there says that we could buy a house 3 to 4 times the price of the house we have. When we were looking at houses (and as I continue to keep my eye on the market), that isn’t close to what we’re looking at. We aren’t even looking to double the cost of our house.

It just reminded me to value quality and to know what is good enough when it comes to housing. Right now, I have a house that’s not too big, not too small. It might not be in line with our income, but it’s just right!

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Big Hat, No Cattle

I just got done reading a bunch of books by Thomas J. Stanley on millionaires. (They include: The Millionaire Next Door: The Surprising Secrets of America’s Wealthy, The Millionaire Mind, and Stop Acting Rich…And Start Living Like A Real Millionaire).  Characteristics of them, mostly. It was super interesting (though I wouldn’t necessarily recommend reading several of his books back-to-back – it tends to get repetitive!)

Anyway, he had several points that I, in particular, found really interesting. One of the phrases that he used is that many people are “Big Hat, No Cattle”. It’s a Texan term, apparently, but easy to understand. It’s the concept that many people look like they’d have lots of cattle, but they don’t. Many people look like they are wealthy, but they aren’t.

They do things that they THINK wealthy people do. They buy things that they THINK wealthy people buy. They wear things that they THINK wealthy people wear. But, they themselves are not wealthy. And chances are, the things that they think wealthy people do, buy and wear aren’t really things that the truly wealthy do.

The typical/average/common millionaire has many different habits than they are stereotyped for. They don’t buy $10,000 watches, wear custom made suits, or even drive $50,000 cars. The chances are really high that they:

  • Have their shoes re-soled instead of buying new ones.
  • Drive a Toyota, not a Porsche.
  • Spend $20 on their haircuts.
  • Have a stay-at-home spouse (not part of a 2-income family).
  • Have never inherited any money or won the lottery.
  • Became millionaires in their 50s.
  • Don’t work insane hours.
  • Don’t own a boat or a vacation house.

Many people who want to be millionaires mistakenly think that real millionaires spend extravagantly. And since they want to be millionaires, they want to imitate them. But they’re doing many of the wrong things to get there. If they want to get there, they would do things much differently.

Millionaires buy cars that suit their lifestyle and that they consider good buys. A Porsche is not a good buy, but a Ford F150 is great for fishing on the weekends.

They might have high incomes (but typically not the highest incomes). A huge percentage of them own their own businesses, invest their money well (but don’t take huge risks on stocks; they tend to play it safe) and work hard, but not 80 hours a week insanity.

Instead, they make wise choices (compared to their incomes). Sure, they have more expensive watches, houses and cars than I have, but considering their income, they are not extravagant. They likely live in a neighborhood with people who aren’t nearly as wealthy as they are and their neighbors would have no idea.  They buy suits that are on sale at Men’s Wearhouse, Kohl’s and JC Penney.

It was interesting reading to me. While there are millionaires that do spend lots of money, it’s not the norm.  Those are exceptions rather than the rule.

I’ll share some more thoughts on it just cause I found it interesting. We’re not set to become millionaires or anything (that’s not even our desire)…I just found it really fascinating to think about.

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My car has been sick lately.  In the shop a couple of different times.  Check Engine Lights.  Not starting.  We think it’s a bad battery, but you don’t really suspect a bad battery when you’re 13 months into an 85-month battery.  Mechanic says bad battery.  Battery store says it isn’t.

And, of course, “Since we’ve got your car in here ma’am and it’s coming up on 90,000 miles, there are several things that Toyota recommends that you do…” So I had to get my muffler fluid replaced too.


(Just kidding on the muffler fluid.  It was fine.)

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Without having a crystal ball that can predict the future, I’ll say “I’ll Never Work Full-Time Again”.

Normally, I work each day, but generally just the mornings.  Most days of the week, I’m home around 1:00 in the afternoon.  But, in the last couple of weeks, I’ve had some weird working schedules.  Because of some schedule changes, I ended up working one full-day instead of two half days and I ended up working an afternoon instead of a morning.  I.Hated.It!

Those two days that I either worked all day or worked in the afternoon, I didn’t make dinner.  I ended up picking up fast food.  It wasn’t because I didn’t have time to plan meals.  Oh no, I had meals planned.  It wasn’t because we didn’t have leftovers that we could have eaten.  We did.  I just didn’t feel like getting home at 5:30 p.m. and making dinner – even if it just involved reheating yesterday’s dinners.

And since Phinehas goes to bed around 7:00 p.m. or so, I only had about 90 minutes with him at night before he went to sleep.

How Do Full-Time Working Moms Do It?!?

This isn’t a judgment that working full-time is a sin.  I don’t think it is.  But from a practical perspective, how do full-time working moms do it all?  With only 90 minutes in the evening, I certainly wouldn’t have wanted to spend a significant portion of it making dinner.  And I wouldn’t want to save laundry or cleaning or grocery shopping for the evenings and weekends.  Truth be told, when I got home, I didn’t feel like doing anything.  I just wanted to drop on the couch.

I adore working only part-time.  To me, it’s a wonderful thing for our family.  For this time.  Jeff leaves for work super early in the morning to avoid traffic.  I get about 90 minutes with my son in the morning before work.  He goes to my sister’s and hangs out with his cousins.  I work a few hours.  I pick him up.  We come home or we run errands.  We hang out in the afternoons.  He naps.  While he does, I prep dinner or do laundry or clean or read.  Jeff gets home around 3:00 most days.  We catch up on our days.  We eat dinner (usually by 5:00 p.m. – we’re early eaters around here!).  We play with Phinehas.  We watch Wheel of Fortune at 6:30.  Phinehas goes to bed shortly after.

There are tons of time that we both get to spend with him.  Not many dads are home around 3:00 most days.  Not many working moms are home around 1:00 most days.  We are truly in a great phase of life.  We truly are blessed to have this lifestyle that suits us so well.

Things will change.  I know this.  Jeff might not always work this schedule.  I might quit my job some day.  But I don’t ever see myself working full-time again.  Not even when we’re empty nesters.

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Life on the easy street?

Another Rosemond quote from his book New Parent Power!

By and large, today’s children have been overdosed not only materially but emotionally as well. They’ve been given too much attention, too much praise, and too many rewards. In short, we’ve made their lives easy, and in so doing we’ve created a fantasy of how the world works. Another family therapist once summed up the situation for me quite well. He said, “This generation of parents has done a wonderful job of sharing their standard of living with their children, but a miserable job of endowing those children with the skills they’ll need to achieve that standard on their own.”

This is something that I’ve been a little thoughtful of lately. I often listen to Dave Ramsey’s radio show. Many of his callers have little comments from their kids who ask their parents “Do we have coupons for ice cream?” or “Is a candy bar in the budget?” – different things like that. I think kids having an awareness of the fact that money isn’t infinite is awesome! I like the idea that kids know that everything has a cost and some things are worth the cost and some aren’t.

I also know that I have a higher standard of living as a young couple than my parents had when they were first married. My parents were 18 and 21 and just getting started in life. My husband and were 30 and 33 and pretty well established when we married.  (While being older has it’s advantages, it’s also not what I would’ve wanted – I would’ve loved to have been younger when we married – maybe not 18, but not 30 either! This isn’t an argument to wait til you’re 30s to get married.)

My husband and I budget, but our budget isn’t super tight. We can go on vacation if we want to. If our car were to burst into flames tomorrow, we can buy another one. Maybe not a Porsche, but we could buy a Toyota Corolla.  I do coupon at the grocery store, but it doesn’t make or break our ability to buy something.  I fear that Phinehas will turn 22, be out on his own for the first time and expect to own a house right away, take vacations, and have a pretty car even though he’s just starting out. I hope we can set his expectations correctly.

As a parent, how do you balance the fact that you can afford a middle class standard of living, but also set the expectations that your children will have to work to get to that same standard – and it will take some time to get there? I think, for us, it won’t be saying that we can’t afford something, but rather telling them that we’re choosing not to spend our money in a certain way. And probably talking about what our lives were like right after we got out of college – apartments, roommates, cheap cars, no vacations.

Setting the expectation that money comes from working and helping him to build a good work ethic and skills that will lead to a good job.  It’s parenting!

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Book: Thou Shall Prosper

I listen to Dave Ramsey.  Pretty much every Monday – Friday, at least for a little bit. I’ve taken his Financial Peace University.  We’re debt free.  I just like his philosophy and the advice that he gives.

A few weeks back (or maybe longer than that), he had a Jewish rabbi on the show – Daniel Lapin.  They referenced his book “Thou Shall Prosper: Ten Commandments for Making Money”, which I have since checked out of the library and read. Utterly fascinating read.  Really.  I thought it would be a “Here’s what you do if you want to make money.  Get yourself a business plan.  Get some business cards…” kind of book.

But it wasn’t.  Not really.  It was mostly him writing about why making money isn’t bad like some would believe. It’s about why and how Jewish people have often been more wealthy than other groups of people.  He uses a lot of Scripture (which is the Old Testament for him) and tells how the Jewish tradition would teach those examples to their children, which happens to be principles that just naturally lead to more wealth.

Is he right about everything?  I don’t know.  But I learned mucho.  And had mucho reinforced. Things like:

  • You’re always in business for yourself (even if you work at someone else’s company)
  • Don’t forget that you owe your company an honest day’s work for the pay you’re given
  • Business is not evil
  • Making money, even lots of it, is not evil
  • Its how you earn that money and what you do with it that matters
  • The key to making money is knowing people and letting them know what you can do for them

Some excerpts that I really liked:

“Whenever a notable philanthropist makes a public gift, there is one phrase you can count on hearing.  It is “giving back to society” as in “Isn’t it wonderful that he is finally giving something back to society.”  Is referring to a charitable contribution as “giving back to society” implying that the for-profit activities that created that wealth in the first place are somehow “taking from society?”

“Bill Gates does quite a bit for the world even before making his very large charitable foundation bequests.  After all, creating thousands of jobs and supplying magical software that allows millions to do their work and to communicate seamlessly with one another are in themselves rather large contributions.  Theodore [someone who criticized that the wealthy don't give enough away] fails to question entertainment and sports figures who undeniably “have a great deal of wealth” yet are notoriously stingy in their charitable giving.  Apparently such criticism is reserved for people who earn their living through business.”

“Much must be right about the economic system in the United States because it allows Americans to take so much luxury for granted. … Have you heard folks say things like “Why not take a day off and spend it with family?” or “Nobody ever dies regretting not having spent enough time at work”?  Those are very pretty notions, but they can be said only by someone with no fear at all of having to put his children to bed that night, hungry and frightened.  In some countries at this time and particularly in earlier times, many parents have been tormented not by not spending enough time with their children, but by  not being able to prevent them from starving to death.”

And a quote from George Mason University economics professor:

“Take out a dollar bill and look at it.  Now pat yourself on your back because you are looking at a certificate of performance.  If you did not rob or steal from anyone to obtain that dollar, if you neither defrauded anyone nor persuaded your government to seize it from a fellow citizen and give it to you, then you could only have obtained that dollar in one other way – you must have pleased someone else.”

How cool that thought is!  We have money because we have pleased someone – a client, our boss, someone else.  They are pleased and show it through payment.

Great read!

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