Who Stole All of Our Money?! (Hint: It Was Us)

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My husband and I have been “saving for a house.”  I put this in quotes because while that was our biggest post-wedding goal, we’ve noticed that our savings really hasn’t gone up in the past couple of months.  I’ll admit that as the one who is normally the budgeting nerd, I have done a pretty poor job of tracking our expenses lately.  I’ll go ahead and blame it on job stress (more about that at a later date), which is partially true.  I found that most days, I was so wiped out by the time I got home from work that I didn’t want to look at anything.  I wanted to buy clothes, or pretty things for our house, or go out to eat.

Then I looked at our savings account.

While we had been doing a great job of saving up, that progress had more or less come to a standstill, which was very confusing to us.  “But we don’t spend that much”, we said to ourselves, “so who has stolen all of our money?!”

Then I took a look at our joint account and my credit card account, just for the past month (6/14/14-7/14/14).  I started writing down all of the non-bill, non-grocery expenditures…and I. Was.  Floored.

No one stole our money (shocker).  WE SPENT ALL OF IT.  I am absolutely kicking myself, because I just think about how much closer we would be to our goal if we would have just stuck to our budget.  Here’s a breakdown of what we did (note: this does not include anything that my husband put on his credit card.  That’s where his “spending money” goes each month, with a portion of our income going towards paying it off.)

Alcohol

total alcohol

I would like to point out that my husband is a fantastic home brewer, and we always have 2 beers on tap at home.  The alcohol expenditures above were wine and rum–not really necessary for those trying to save for a home.  That could have easily been cut in half, if not more.

Dining Out

total dining out

Ahem.  I think we found our problem.  This doesn’t even count dining out expenses that were put on my husband’s credit card.  What’s sad is that this is much more than our grocery budget for the entire month.  Do you know how much awesome food we could cook for $417.23?  We’d eat like royalty, I tell you.

I don’t think that there’s anything wrong with dining out, but within reason.  A lot of these were going out with friends or co-workers, and a few were some very necessary trips to get frozen yogurt (IT WAS SO HOT HERE.  Really, it gets hot in Buffalo for at least a week each year).  There are definitely a few things that we could have done to cut this expense down drastically:

  1. Buy ice cream or frozen yogurt at the grocery store ($11 for one trip to the frozen yogurt place?  Really??)
  2. Stick w/ one drink per meal, or don’t order alcohol at all (it has the highest markup of any item at a restaurant!)
  3. Do a better job of planning meals ahead of time and having some meals already made and frozen for the nights when we’re too tired to cook
  4. Invite friends over for dinner, brunch, etc.–or just say ‘no’ to going out if it’ll put us over budget (which is really hard to do, I know)

Home Improvement

total home improvement

Because we rent, this isn’t an area that we normally spend a lot of money on.  We both just started working from home, though, and most of the home improvement expenses for the past month went towards setting up an office for my husband.  Ideally what we should have done is to have taken a chunk out of his normal spending money for the month to put towards at least some of this, rather than using money that we could have put into our savings.

Miscellaneous

total misc

Right away, four big expenses stand out: Brewers Festival tickets, haircut, massage, and Emeals annual subscription.  There are still a handful of other expenses, though, that helped to push this category up to almost $400.  What could we have done differently?

  1. The Brewers Festival includes a concert, and it’s something that we’re going to with my husband’s parents, so we probably would have gone to that regardless.  However, we could have saved some of each of our spending money over 2-3 months to cover the cost, instead of having it all come out of one month.
  2. Emeals is actually worth the cost IF WE USE IT.  Cooking at home = worth it (you receive a week’s worth of recipes ahead of time, and a lot of those meals share ingredients, so it saves money on groceries).
  3. I’m in between with the haircut–the $52 included the tip and I love the salon I go to (also, I am terrible about going regularly and usually only get my hair cut 2-3 times a year).  I could have waited to get a massage, though, until it fit within my spending money budget.
  4. I don’t even remember what half of the other expenses (Target, Marshalls) were.  Some of them were gifts, which, with better planning, is a more controllable cost.

So there you have it, friends.  This is why we haven’t bought a house yet.  We’ve stolen money from ourselves to do things that make us happy in the short-term, rather than focusing on the long-term goal of buying a house.  WE WILL NOT BE DEFEATED (by ourselves), though. Back to the budget we go (and that credit card is coming out of my wallet)!

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Judge Not, O Indebted One

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I have a confession: I judge other people’s financial behavior like nobody’s business.  If I know that money is tight, but I see you in a new dress…BAM.  Consider yourself judged.  Spent money on a vacation? I can only assume that you spent the entirety of that vacation foolishly disregarding your student loan debt. Oh, did you buy a brand new car?  I hope you enjoy living in it, because you probably just spent your mortgage payments. (How do I have any friends?)

Like the quote above says, we judge others by their behavior, and ourselves by our intentions.  The way I see it, both are pretty dangerous habits.

Judging Others by Their Behavior 

Maybe money is tight, but you found a cute dress on clearance that brightened your day.  Maybe you do have a lot of student loan payments, but you saved up for a vacation–and found some great deals while you were planning it. Maybe you researched new cars, saved up a good down payment, and had a decent trade-in for that new car.  Even those closest to me don’t know the intricacies of my finances, and likewise, I don’t know all the details of theirs.  And yet, I still find myself judging them, often very harshly, on the small pieces that I do know.

This mindset–that the behavior of those around me reflects poor intentions, or selfishness, or an inability to face reality–can only hurt my relationships.  It puts me in the unearned position of feeling superior to friends and family, when I should be approaching them from a position of love and support.

Judging Ourselves by Our Intentions

Do I always make the best financial decisions?  Absolutely not.  Do I make excuses for myself? Sure do.  Case and point:

We’ve spent almost two hundred dollars on takeout over the past couple of months. 

But we’ve been busy and too exhausted to plan meals and cook.

I went to New Orleans for work and exceeded my monthly “fun money” budget.

But the colors in the Pearl Jam print are beautiful…and it’s something that we’ll display in our home…and when am I going to go to New Orleans again?

 I purchased (yet another) black dress for the trip. 

But what would people think if I wore the same dresses I’ve already worn to other events?

Why do I feel that it is okay to hold others to different, much higher standards than those to which I hold myself?

Because I remember my intentions, and excuse my behavior. 

What should I do when I see someone making financial decisions that I don’t feel are appropriate?

  1. Be slow to judge–unless it has been explicitly explained to me (i.e. “Katie, I have $5 in my bank account, but I felt like making a foolish financial decision, so I went out and bought these shoes”), I need to remember that I don’t know why the decision was made.  Even if it was explicitly explained to me, back off! I don’t need to agree, but I need to respect that it wasn’t my decision to make.
  2. Ask myself–and honestly answer–what would I do in their position?  Or rather, what have I already done in their position?  I have certainly bought something small to brighten my day, even when it didn’t fit in my budget, and I distinctly remember purchasing a plane ticket to London when my credit card was nearly maxed out.  It happens.
  3. Offer support and guidance, if it will be welcomed. Nobody likes a know-it-all, but as someone who has worked to get out of debt, I do have something to bring to the table.  If nothing else, sometimes it just helps to have someone to talk to when you’re in a financial pickle.
  4. Redirect that energy towards my own debt.  There’s enough there to keep me busy for a few more years, eh?

What about you?  How do you interact with friends and family who make financial decisions that you don’t agree with?

Photo Credit

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Related Post:

Spending Excuses: My Big 3

2013: A {Monetary} Year in Review

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2013 was a big year for us.  We started the year off by creating our budget and setting some financial goals.  Our #1 goal was to pay for our wedding in cash, with no assistance.  And guess what?

We did it!

We created a separate wedding budget, accounted for EVERYTHING we could possibly think of, and paid for our wedding completely out of pocket (about $13,000 when all was said and done. Whoever said a wedding had to cost $30,000 is a goober.  Check out this post to see how we did it!  I’ll write an update about how it turned out in a future post, but suffice it to say–best. night. ever.)

Meanwhile, back at the ranch…

While creating our goals and budget for the 2013, we knew that we didn’t want to throw everything we had at the wedding.  That’s where the budget comes in handy–by identifying our monthly income vs. expenses, we were able to reasonably identify how much was left over for debt reduction.  When all was said and done, we reduced our debt by about 23%.  We still have a lot left to pay off, but WOW…is this a great feeling.  We also have our $1,000 emergency fund and thanks to our wonderfully generous friends and family, we were able to recoup what we spent on the wedding and then some, which went right into the bank.

In review, here’s where we ended for 2013:

Paid $13,000 in cash for our wedding

Maintained our $1,000 emergency fund

Paid off 23% of our debt

Saved a large chunk of money to put towards our 2014 goals (and beyond!)

Exciting stuff, right?  You’d think we would get after it for 2014, right?  

Full disclosure: It is January 11th and we still have not revised our budget for this year.  Oops. (See, even the budget nerds trip up!)  That being said, we’re going to make it a priority ASAP, because we have some HUGE goals coming up, including:

  • Going on our honeymoon- and paying for it in cash
  • Buying our first home
  • Making some mini-budget nerds

…so let’s get budgeting!  Ready?  Break!

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Need help creating your budget?  Here are some great resources:

Dave Ramsey’s Budgeting Forms

Be Organized- Our New Budget Sheet (through trial-and-error, this is the method that has worked best for me.  What can I say? I’m a pen-to-paper type of gal).

Kiplinger’s Household Budget Worksheet

 

 

 

How to Reduce Your Mortgage Closing Costs

We’re hoping to buy a house within the next year, so today’s post over a Wise Bread about mortgage closing costs was perfect timed!  There was some great information, including a few things I had never heard about.  Specifically, I’d never heard of “points/prepaid interest” in relation to mortgages–and according to this post, those are the single largest closing cost!  Check it out for yourself:

8 Ways to Reduce Mortgage Closing Costs

Wedding Planning on a Budget

Weddings are expensive.  I have been to some really elaborate ones that were beautiful and entertaining…but very expensive.  I have friends who have taken out loans large enough to purchase a luxury car just to make sure their day was perfect, only to regret that decision during the subsequent 5-10 years of payoff.

When the Mister and I got engaged last year, we made three decisions: 1) we didn’t want a cookie-cutter wedding, 2) we didn’t want to go into any more debt, and 3) we wanted to pay for the entire thing ourselves.

We’re getting married at the end of November, and I’m happy to report that we will achieve all three goals!  How did we do it?

 

WE MADE A PLAN:

We had about a year between the engagement and the wedding.  We sat down and estimated all of the expenses (over-estimating for the expenses we were unsure about), and figured out the total amount we would need to pay for the wedding in cash.  We then divided the total by the number of months we had to save, and figured out how much we would have to throw in savings each month.  That number was added into our monthly budget.  Since I’m the budget nerd, I made sure I was sharing the number as it crept towards our goal—we were so excited when we realized we’d actually hit it!

 

WE WERE CREATIVE:

While our combined income is decent, it’s by no means amazing.  We are also still chipping away at our debt, and didn’t want to give up on that goal while saving for the wedding.  That meant that we had to get creative with the wedding—there’s no way we could afford all of the typical expenses.  Here are some of the biggest areas in which we were able to save:

Wedding dress: My mom is making it!  She’s a great seamstress and it’s going to be beautiful.  That being said, I understand not everyone is lucky enough to have a mama who is talented with a needle and thread!  There are so many other options though—find a friend who sews, or a local designer—or go secondhand!  There are a ton of places online to find dresses in perfect shape for a big discount.

Bridesmaid dresses: This isn’t actually something we would have paid for anyways, but I found a local designer who could custom-make dresses for each of the girls (based on a picture that I found) for less than the cost of a David’s Bridal dress.  The dresses look great!

Suits instead of tuxes: Rather than having the guys rent tuxes they’ll never wear again, we just told them to wear charcoal grey suits.  Most of the guys already own them, and those who don’t will be able to use them again in the future.  We didn’t give them a specific suit they needed to buy—as long as it’s dark grey, they can purchase whatever fits within their own budget.

Photographer: I asked around and found a friend of a friend who does amazing wedding photography.  Because I had been referred, she offered us the friends and family discount, which almost cut the cost in half.  We double lucked-out on this one, because the photographer has a friend who is a…

Deejay: Nicest guy ever, deejays weddings as a side gig.  He has all of the equipment and is charging us a fraction of the cost of other wedding deejays.

Location: We found a place where we know the food and drinks are great, and there is no site rental fee.  We also chose not to go the typical beef/chicken/fish route for food—instead we selected a buffet option with food that people actually want to eat (chicken wings, anyone?  We do live in Buffalo, so that was a must).

Save-the-Dates/Invitations: There are some really awesome websites for these.  I used WeddingPaperDivas.com for the Save-the-Dates and Minted.com for the invitations.  Both turned out perfectly and I was able to find coupon codes that knocked a big chunk of the cost off each.

Cake: Instead of a big, dry wedding cake (or a crazy expensive delicious one), we’re doing a small cake just for us, and tiered display of donuts for the guests.  Jackpot.

Florist: I asked around about this too, and was directed to a local guy who doesn’t even have a storefront.  Apparently he does floral arrangements for some of the local elite and gets all of his business from referrals.  His work is gorgeous and very reasonably priced—I never would have found him without asking.

There are a number of other small ways in which we’ve saved money—coupons and sales for centerpiece stuff, creating the programs ourselves, foregoing favors and instead giving a donation to a local charity (with a small note to each guest).

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I am SO glad we figured out the costs ahead of time—having a concrete goal in place made it easy for us to stay within the budget.  We knew exactly how much we could spend, so that forced us to be creative where we could.  The best part?  Our wedding will be very “us” and we can enjoy it, knowing that when we wake up on our first morning as husband and wife, we won’t have another $30,000 in debt staring us in the face!

Tell Your Tax Return Where to Go

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It’s everybody’s favorite time of year–tax time!  Oh, how I dislike doing my taxes.  I do love the return, though.  I was thinking about my return over the weekend, and all of the things I could do with it, namely–purchasing some new clothes for work, since a lot of mine are starting to look worn.

The problem with waiting a few months to do my taxes is that it inevitably leads to ideas of grandeur about what I can do with my return. In reality, the return is much smaller than I want it to be, and it doesn’t stretch nearly as far as I’d like it to.

I thought I’d offer a few suggestions for how to handle your tax return.  These are pointers than help me spend it wisely, as opposed to blowing the whole thing and having nothing to show for it. 

#1: Don’t spend it before you get it

I almost fell into this trap.  While walking around the mall with my fiance over the weekend, I saw shoes, belts, bags, and clothes and thought, “Oh…that sure would make me look like a professional lady.  Maybe I’ll just purchase it now and deduct the amount from my return.”  Dangerous road, professional lady…dangerous road.  Instead, always, always, wait until the money is in your account.  Don’t put yourself in the hole before you even get the money.

 

#2: Make a plan

This isn’t rocket science, nor is it very time consuming.  When you don’t make a spending plan, though, you risk spending your money on things that aren’t very important, and that aren’t aligned with your financial goals.  Tell your return where to go.  Figure out what debts or needs could use it the most, and if you don’t have debts or needs, put it in savings.

If you are one of the lucky few with no debts, no needs, and a lot of savings, then enjoy making yourself look like a professional lady (or man), or do whatever you want with it.  I have a sneaking suspicion that most of you aren’t in that position though, so make that plan.

For instance, I know that as soon as my return is in hand, I need to purchase tires for my car, purchase a wedding gift for my sister, and the balance will go to my student loans.  Goodbye, new wardrobe!

 

#3: Don’t forget where it came from

This is your hard-earned money, not a nice gift that the government is sending you.  Your tax return is money that you have loaned to the government (and they don’t even pay you interest on it!)  Don’t treat the money as a gift; treat it as a paycheck, and spend and save accordingly.

 

Haven’t done your taxes yet?

If you are an individual or family with a combined 2012 income under $57,000, you may be able to file both your state and federal returns for free, using this: http://myfreetaxes.com/ (Disclaimer: I am not qualified to give tax advice, nor am I affiliated with myfreetaxes.com.  This site was recommended to me by my cousin, and I found it to be a very easy and free way to do my taxes.)

 

Hotel Toiletries: A Money-Saver’s Dream Come True

 

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Photo Credit

I’ve been traveling a lot lately, mostly for work.  I’ve gotten to stay in some pretty cool hotels, and one of my favorite parts has been the free toiletries (yep…livin’ the dream).  Between hotel samples and free samples that I get in the mail, I’ve gone months at a time without having to buy shampoo, conditioner, body wash, and toothpaste*. It might be a small amount of savings, but over time, that adds up!  That being said, don’t be the weirdo who swipes stuff from the housekeeping cart.  Stick to what you’re given.

In honor of my love for all things free, I combined my own experience with a little research to find out what you should take, other than the obvious items (such as shampoo, etc.):

1) The magazines and newspapers in your room: I  wish I had known these were free–I recently stayed in Aspen and there were a bunch of really fun magazines that I didn’t have time to flip through!

2) Soap: I rarely open the soap at hotels, except for the one by the sink.  Take it, though, and use it to freshen drawers, closets, shoes, or your car.

3) Shaving cream and razor: This isn’t one that I often see in hotel rooms, but usually if you ask the front desk, they’ll give you a set for free.

4) Coffee and tea: Free Starbucks and Tazo?  Yes, please.

5) Mouthwash: Keep it in your purse, in your car, or at your desk for your less-than-minty-fresh moments.

6) Sewing kit: These things are lifesavers. Keep one in your purse or desk drawer for when you lose a button or rip a hem.

7) Paper and pens: Hang onto them!  I am forever writing notes and lists at home, and I can’t remember the last time I actually had to purchase pens or paper.

8) Shampoo and conditioner: I know these are obvious, but just in case you pass them over, don’t forget that they’re the perfect size to bring on the plane.  Even if you don’t like the shampoo and conditioner that’s offered, keep the bottles to refill with your own.  I also read a pretty genius tip–after washing the bottles out really well, use them for condiments if you bring your lunch to work.  Finally, a solution to my salad dressing transport problem!

9) Shower caps: Use them in place of plastic wrap when you have to cover a bowl.  You can also use them to cover the bottom of your shoes when putting them back in your suitcase.  No more dirty clothes!

10) Toothbrushes: There are a million uses for these–keep one at work, or store it away for when you have a guest who forgets a toothbrush.  You could also use it to clean your tub or your jewelry.

What are your favorite freebies–and have you found a way to use them creatively?

 

*While I was looking up suggestions for how to get the most out of the toiletries, I saw quite a few people who recommended collecting the items and donating them to homeless shelters and/or women’s shelters.  I think that’s an awesome idea.  Even if you don’t plan on using the toiletries for yourself, snag them and donate!