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Archive for the ‘money’ Category

I’ve come across so many articles lately about “How to Live on 1 Income!” or even “Why doesn’t America have mandatory maternity leave like other countries do?”.  I get it — it’s even something that I blogged about before — years ago.  But since then, I’ve kind of realized some things.  Such that now whenever I hear the question “How Can We Live On One Income?”, I mentally reply “As long as your income is Bill Gates’, then you’re fine.”  For a while, I thought of it as an income problem.  Or I mentally think “Just have the expenses of Mother Teresa, then you’re fine.”  I would think of it as an expense problem.

Okay, not really.  It doesn’t take Bill Gates income to support a family.  And you don’t have to have expenses of a single nun.  And while, at the end of the day, it does come down to expenses and income, I’m guessing (just guessing) that in my circle of friends, there are 1-income homes making $40K/year and they make it work. And there are probably also couples making $150K/year who struggle to pay all their bills.  So, it isn’t the amount that’s critical – it’s the decisions made that make all the difference.

But even that statement is kind of misleading.  Because, I’ve realized that:

  • It’s the decisions your parents made when you were growing up that affect you today.
  • It’s the decisions your spouse’s parents made when you were growing up that affect you today.
  • It’s the decisions that you made after high school that affect you today. (Student loans, rents, mortgages, car loans, etc)
  • It’s the decisions that your spouse made after high school that affect you today.
  • It’s the professions that you’re in that affect you today. (Income potential as well as other expectations like dress code, cars, houses)
  • It’s the professions that your spouse is in that affect you today.
  • It’s the part of the country that you live in that affect you today. (Particularly housing has a huge effect on cost of living)

It’s all kinds of things.  I’ve just come to realize that being/having a stay-at-home spouse is a complex issue.  It’s not SOLELY a function of the decisions that you make today, but it’s influenced by decisions made for the last couple of decades and decisions not even made by you.

Over the years, my mind has gone from “You just have to make a budget that only spends what you make.” to “You just have to have 1 income that makes enough money to support your needs.” to “I think people need to really be wise about their decisions and the decisions that they lead their children too because financial decisions can have a really long-term effect.”  Aka: It’s complicated. 

 

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We sold our house! For Sale By Owner! (Which you already know because we moved into the new house over a year – I’m a little behind in posting!)  It took us 5 weeks, which is great when you’re doing it For Sale By Owner.  I’ve driven by houses in our town that have been on the market for months – and that’s with a realtor!

We actually had 3 people/families that were really interested.  In fact, when it had been on the market for just 9 days, I thought we had it sold.  A gal made an offer, we accepted it, but she backed out when it came time to sign a contract.  I think she just panicked – even though she went through it twice, brought parents, sisters, nephews and had her grandfather review the contract.  (Which, before a contract is signed, is the best/easiest time to panic.)

Here’s how we did it.

Price it well
This is the first thing that everyone will tell you to do. If you price too high, people will just write you off and not even walk through. For us, we looked at houses that had recently sold and set a price. When we were setting the price, there was a house literally 2 doors down with the exact same floor plan that was also for sale. It had been a foreclosure that sat empty for over a year and a half, bought by a renovator and fixed up a little.  They had it listed with an agent and we knew we wanted to be just a little less expensive than they were. So we went 1-2% less than they were asking.  We were blessed to be in a position where we didn’t need to get absolute top dollar for it.  It was more important (to us) to have a buyer than an extra couple of thousand dollars.

But literally 2 days before we put our For Sale sign in the yard, they removed theirs. We thought it had sold, but we learned much later that they really had rented it out instead because they couldn’t find a buyer.

Get it cute
We spent a lot of time making it look as cute and clean as we could. We rented a storage unit between the 2 houses and just started packing boxes. We filled up about 3/4 of a 10×10 foot storage unit. Stuff we wouldn’t need in the next few months.   We had lots of bins of baby clothes that no longer fit, baby clothes that don’t yet fit, toys our son has yet to grow into along with tons of diapers, personal care products, and canned goods (I’m a couponer!) plus holiday stuff. It made moving that much easier, but it also made selling that much easier.

We gave some attention to the yard, putting down new mulch and planting a couple of hosta plants in areas. We focused on watering for a couple of weeks to get the grass nice and green.

I touched up places where paint may have gotten scuffed off on inside walls or outside where it was chipping off a little bit.

I got rid of furniture that wasn’t critical or often used. Make it look as big as possible.

I organized pantries and closets, sending a couple of tubs of stuff to Goodwill.  (In hindsight, I wish I would’ve done more!)

Since we moved in, we knew our wood floors needed refinishing, but didn’t really want to do it. We thought we’d just acknowledge the scratches and stains and tell people that we lowered the price $1000 (about the cost of refinishing them).  But, in the end, we figured a first time home buyer would be intimidated by that and it ruined the cute factor – in a key area of the house. So, we bit the bullet, slept in the basement for a few nights (so that we didn’t walk on the floors) and had the work done.

Advertised on zillow.com
As I cleaned each room and prepped it, I took pictures and then created a page on zillow.com. I chose that as my primary place to hold house information. Cost: FREE!

Offered a Referral Bonus
Since we didn’t have a seller’s agent finding leads for us, I knew that word of mouth was going to be our biggest asset. So, we offered a $500 referral bonus to anyone that found a buyer for us. Turns out we didn’t need it, but there was no telling where our buyer was going to come from. It definitely generated some buzz for us and I’d totally do it again.

Create a flyer
Our flyer wasn’t anything fancy, but we needed one for the Info Box in our yard and for sending to people.  I mimicked the format that I had seen realtors use.

Email & Facebook
Once we were ready, I sent an email to friends and family with the flyer and link to zillow.com. Then I announced on facebook, making sure to stress the referral bonus. One of our strong interests came from this route (via a facebook friend), but they were interested just a little too late – we had already accepted an offer.

Craigslist.com
Since Craigslist is free, we advertised here. We did have 1 person come through before the Open House as a result of this ad, so it was worth the 10 minutes it took to set it up.  The person who found us this way was actually a real estate agent who also checked craigslist…you just never know who is watching it!

Listed in the paper

Our hometown paper has a program where you get an online ad and you get your Open House listed in Friday, Saturday and Sunday’s paper of that week. Since our big push was the Open House, we ran for a weekend. Cost: $100 or so.

Advertise to neighbors
I created a postcard, had it printed at overnightprints.com and mailed them to 150 of our neighbors. I don’t know most of them, but they got a postcard anyway. Getting the addresses was easy thanks to our county’s assessor’s website.  It listed the features of the house and said that we were also offering a referral bonus if they referred the buyer. Most importantly, it directed them to the website. I put a bright sticker on there, announcing the Open House as well. I was careful to not put the price on the postcard in case we decided later to change it.   Cost of postcards and postage: Less than $100.  I’ve removed some critical information, but here’s what it looked like:

 house_for_sale_front_web

house_for_sale_back_web

What we didn’t do, but would have:
There are a few ideas that I had, but never implemented. I figured we’d get past our Open House and if there wasn’t any nibbles, then I’d look at doing these things:

  • Listing on ForSaleByOwner (or something similar).  There’s a cost to this though.
  • Creating a youtube video of pictures or even a video walk through of the house to give people a better idea of the house.
  • Make our own signs for the yard and direction signs. Something bright and eye catching just made with plywood.

That’s how we did it!

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Open Enrollment

Medically insurance speaking, it’s Open Enrollment in this house.  When did things get so complicated?  Ah, yes, I remember now.  They got complicated when I stopped being single and started having more than 1 plan to choose from.

They got more complicated when we had kids and moved up into “Family” plans instead of “Employee” or “Employee + 1″.

They got more and more complicated when we had a baby last year and a head surgery — that will make you take “Max Out Of Pocket” really seriously!

Seriously, I had to end up creating the spreadsheet-to-last-through-the-ages to help us determine what our best options were.  Jeff’s HDHP?  My HDHP?  Cover Jeff as an individual, then do a family plan with my employer?  Cover me as an individual, then do a family plan with Jeff’s employer?  What if Jeff & I each took a kid onto our plan(s)?

AND…What are the results if we have practically no medical expenses next year?  What if we have another baby AND another head surgery?  What if every member of the family ends up visiting the ER 20 times?  What if?  What if?  What if?

The answer is different if we expect no medical expenses (which we don’t) compared to expecting every person to need a $50,000 surgery (we don’t expect that either).  So, I created a spreadsheet with all our options, all the possible coverage permutations and it allowed for inputs like expected medical expenses.

But, man, this used to be easier!  (Not complaining because we are truly blessed to have the medical insurance options that we do have in a place with excellent medical care and that we generally have good health.)

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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!

 

Nerd.

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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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