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Archive for September, 2008

Pay cut

September 30th, 2008 at 11:29 am

Looks like my job is going to be taking a pay cut since I'll no longer be allowed overtime. It was great cause it helped us out financially and I was able to get a lot more done.

But I'm not bummed about it. We shouldn't be living on my pay anyway. This is just forcing us even more to change our spending ways.

Its about a good decline but just reinforces to DH that now is NOT the time to be spending extra money.

My toughest thing to grapple with is... We pay $375/mo right now for my son's preschool. Without the O/T we're in the red and if I got rid of saving $250/mo for our retirement and his preschool, we'd be back in the black.

But his preschool is only till June. And I don't feel like its a luxury because I work from home, he needs the interaction and I saw how much he improved last year. He is 4 y/o and already reading.

We really just need to pay off DH's car. We owe $11K on it and if we paid it off, then we'd be fine especially with his pay raise in January.

Seriously, I don't know how we survived last year. Last year we were $800/mo in the red.

We're sitting down tonight to go over what we can cut. I'd be willing to forego our retirement savings for 8 months just so our son can continue to go to preschool. But we really need to pay stuff off!

The silver lining is... thank god this is hitting us when he gets his bonus cause at least we have the money & are in a position to figure out what to do with it instead of not having the money and not knowing what we will do.

Glad I missed that loss, but should I buy back in?

September 30th, 2008 at 06:22 am

I moved DH's retirement fund last week to government secured funds. In January, we had $17K and have consistently put money towards the account. But last week we had $16400, so the day I traded it to a more secure investment - I made back $200 so it ended up at $16600.

Its all in the "G" fund right now. And I'm glad for that, because with yesterdays market - we would currently have $15600 in there. I looked at the share prices and last time they were this low was in 2006.

But now that they are this low, I wonder - should I buy back in to the Lifecycle 2040 fund? I do want to ride this out, but I don't really want to lose everything either.

Jim Cramer says without a bailout stocks could continue to go down to the dow in the 8000 range. So is now a good time? I avoided the 7% drop.

Or should I just keep our current $16600 in the G fund and all of our new investments going towards the lifecycle fund? This is our retirement account after all.

I'm also not sure if given the current market I should be putting his bonus to an EF or to pay down the CC. We talk to the financial planner tomorrow night and in the meantime, I took his $662 uniform allowance and put it in our savings. Then when we get the bonus I'm going to put $1250 to add to that. This still lets us fix DH's car, neuter the dog, and a few other necessities.

And unless I have a better idea as to what to do with that money - in the savings account it will stay cause I don't know exactly what should be happening in todays market. Do I put our retirement money back in? What do I do with his bonus? We may need credit in the short term and if we can't get it because we put all of his bonus money to pay down his credit card and don't have an EF... we could be out of luck.

Cheap Date

September 28th, 2008 at 06:41 am

Today my husband and I are going on a date. We started doing this once a month since May.

I like to think of it as an investment in our marriage rather than a luxury.

I recently went to a playdate and told one of the mothers that my husband and I have been together since we were 17 & 19. She then asked "Do you still love him?" And without blinking or having to think about my answer I said "Absolutely"

I wasn't offended either. I'm well aware of the stats for people getting married at 18 & 20. More so, I was remembering how far we've come and how I still love how close we are today. I hope that never changes.

Anyhow, so I'm not letting a tight money schedule hold us back from our dating and going out once a month.

We're going to see a movie but it should only cost $3 because I have movie tickets. Then I was thinking about us going to Starbucks and sharing a drink... which I have a Starbucks gift certificate.

Don't really have a plan for dinner, but I'd be perfectly content going to the grocery store to buy some food and a glass of wine instead of going out.

The most expensive thing will probably be the babysitter at $10/hour for four kids. So the plan is to stay cheap.

When we were dating in Hawaii, he used to catch the bus to see me and we'd walk all along Waikiki. Sometimes we'd stop at the movies and watch something... but most times we'd stop at Jack In the Box, share a meal and then walk back to my house. That was our date, every weekend for 5 months.

Its not so much as what you DO... its the company you keep. And for those five months, we have some amazing memories cause we were more wrapped up in each other than what it was we were doing. I remember being so excited once when we shared Oreos on the beach together cause he knew it was my favorite snack.

I'm not sure how we ever got swept up into the idea that to have a great date it needs to be expensive and lavish... we had it right from the beginning.

Money and the misunderstanding of the Law of Attraction

September 27th, 2008 at 06:40 pm

I'm going to try to get back into the swing of things with blogging here again. I made some great headway when I was more active here.

Early September I really applied the Law of Attraction into my life, I think I've read a ton of books on it. TheSecret, A New Earth, then read some others... like The Last Lecture, and now I'm reading a book regarding Money and the Law of Attraction

When I went to Blockbuster today, I exchanged our mail in movie for another movie which would have been free, but I HAD to pick up snacks. So I went to put it on my debit card and it declined (the electric bill debited sometime between last night and this morning) so I grabbed the $5 out of my wallet. Now, before I get into that... that $5 was in a separate place in my wallet... it was from a Lottery card I had won and redeemed with my son by my side. It was the day before his surgery and I remember feeling anxious that day, and perhaps I'm silly - I called it my lucky $5.

And yep, because my card declined at Blockbuster - I spent it. Then left the store wondering - "What did I just do?"

Came home and thought. I MUST be applying this Law of Attraction thing with money wrong... the LOA says to approach situations like you can afford anything you want. But I notice I've been more frivolous with money when I'm like that. Yet it says when I'm penny pinching, I'm blocking more money from coming to me.

Obviously, I have something wrong in my understanding. If it was any other $5, I wouldn't have cared - but it was THIS $5 that I spent. $5 that was in my wallet, that I had put in there to remind me I always had money in my wallet... even if it didn't seem like much.

So I sat down tonight and rethought my goals.

I'm going to take this step by step. First goal is to tackle the first CC. I am going to pay $3629 to it this month, and in Nov & Dec I need to pay $329, then in January $429. In February, when I get our return, I'll take our state and federal return to pay off the remainder and there should be enough left to get DH a used motorcycle. So I should meet my first goal by February.

Next goal is to tackle paying off DH's car. I'll start applying what I was paying towards the CC to his car and it should be paid off by August next year. And with DH's bonus next October, it should wipe out my CC.

So in 12 months that is paying off 2 CC's and 1 car loan for a total of $27K or so?

Some of the payments I don't know how I'll make. Even the $3629 for October, but somehow I managed to spend money on frivolous things this month... so the money will be there. Cause if I can find excess money to spend on nothingness... I can find excess money to pay down my debt.

I also got a letter in the mail today that because I'm in school my student loan is in deferment (its at 1.65% interest) so for the $129/mo I was paying on the CC, that's an extra $110 towards meeting my $329 payment goal.

I still do believe in the Law of Attraction... just think I got the application wrong when it came to money. Just cause I believed I had extra money didn't mean I need to SPEND it. It doesn't mean I need to pinch every penny either. I think I need to take a balanced approach... people with money have it just because they are smart about it. They are discriminant in what they want and know what they want. They don't buy things "just because" or "on a whim" - they buy it cause it would fit their selective taste.

I think Suze Orman said once that when you don't spend money wisely, you don't respect money. So to add to that, I think in order to draw more money to you, you need to respect it, appreciate it, and know what you want and not be distracted by the gimmicks and distractions out there.

Safeguarding assets

September 25th, 2008 at 04:46 am

This morning I decided to go ahead and switch what remaining money we did have in our retirement accounts into "safer" investments.

I looked at my own IRA (which is down 20% from last year) and realized in order for it to go back to what it was, I'd need a 40% gain. Which I don't think is likely.

So I took 2K of the 3K and moved it to a Treasury Money Market fund.

Then with DH's TSP, in January it was at $17K, its currently at $16K even though we've put away $145/mo, and moved the $16K to the 'G' fund.

The monthly amount we put away in savings will still be going to the original funds, I'm invested in a Balanced Strategy fund, Capital Growth, and Science and Tech fund which is still about $1000 among those funds... and he is in a Lifecycle 2040 fund... BUT my thinking is, regardless if things get worse or better - I want to be confident that the money I do have is safe. So instead of focusing on the losses we've incurred in the past year, my focus is on protecting and securing the money we do have. So just knowing we have $18K PROTECTED in our retirement accounts gives me peace of mind.

I don't know what the future may hold, but I do know that things will be okay and with the $4K that is coming to DH in 2 weeks I'll be making sure that money is safe and put aside for emergencies while making sure our current needs are addressed & the credit card gets paid down.

What would YOU do with $4K in today's economy?

September 24th, 2008 at 05:38 pm

And should the economy factor into it?

Right now, DH's credit card has $8500 at 6.75% on it and mine has $8600 on it with 0%.

In two weeks he is getting $4K

We need $250 to neuter the dog, around $1500 to do maintenance and repairs on his car, and after that I guess is what we have to work with.

In December, I have to pay my Spring tuition (probably around $2000) and I WAS planning on putting the remaining amount to paying down DH's card and putting the $2000 on my credit card at 0%

But now, with the economy, I'm not sure if I should save $2000 out of his bonus to earmark for tuition or what.

Should I even continue going to school at all?

I'm 4 classes into a 10 class program for my M.S. in Accounting. I should graduate in December 2009 and my husband's orders are up in January 2010. So if I don't go now I run the risk that I may never finish my road to becoming a CPA.

We do save $145/mo for his TSP and $250/mo for our IRAs (which are down 20% but its not like there is much in them $2500-$3000 for my IRA and $17K-$20K for DH's TSP depending on if the market is up down or sideways) but we are dollar cost averaging and we are still in our 20s. I also have about $60/wk going into a savings account but I don't have much in it.

So I don't know. Part of me gets the impression I should hold onto the money but if I put it towards the credit card I'm at least saving the interest on what I would have paid down on it.

Good news is, I am negotiating a raise with my company right now and the Senate approved the 3.9% pay raise for the military so in January, DH will be making $100 more and in October '09 he will get another $200/mo.

Anyhow, I guess this past week will make class tomorrow interesting and I'm interested in seeing the political debates and what the president has to say tonight.

I'm actually rather positive about the whole thing, not because people are losing jobs and we are on the brink of what could be a depression.

I'm positive because I feel like this may become the catalyst to get the average citizen to STOP doing things they shouldn't and getting back to a cash economy and doing things the way we should have been doing it all along.

So although overall it seems pretty crummy, I think anytime we stop doing something wrong and start doing something right - in the end, its a good thing.