Money Monday: The Beauty of Automation

For most of us, we spend a lot of time thinking about how to spend less and save more. If you head over to CNN Money, MSN Money, or Yahoo Money, there are articles with titles like "How to Save in 2015" or "Save Money Now." We all know that saving money is important, but for so many of us, the problem is not the concept of saving money, its controlling the person looking at us in the mirror. So often, we make excuses for why we don't save, or we simply don't get around to it. We say things like "I don't make enough money" or "After this happens, I will begin to save."  But, for many Americans, that day never comes. 

We have all heard that we should "pay ourselves first." All that means is, before you pay your bills or any other obligation, pay yourself. Put money into a savings account first. Obviously, the more you save they more you will have, but even if you can only save a few dollars a week or month, getting into the habit of savings will set you on a path for a more sound financial future. Again, most of us understand the concept, the problem comes when we have to put it into action. 

 Today, that has literally never been easier. Almost every bank offers automatic transfers for free on their online portal. It takes about 2 minutes to set up a transfer from one account to another. Once it is set up you no longer think about it. It has been my experience that after a few months, you don't miss the money you have saved, and begin to operate as if those funds never existed. Meanwhile, your savings will grow, and you are able to tap into those funds when you need them, be it for an emergency or for a goal you were trying to save for. 

Years ago, I read the book, The Automatic Millionaire, and in the book, David Bach argues that automating your finances bypasses the human element (aka the lack of discipline) and makes savings easier. Bach's main thesis is that wealth is not necessarily determined by what you earn, but rather what you spend, and by making savings an automatic process, you will be able to build wealth over time. 

My husband and I set up automatic savings years ago, and now, we are accustomed to those funds being transferred on a certain date each month. However, one area of our financial life that we have not automated yet is our retirement savings. My company offers a 401K and I fully participate and receive my company match, but for our Roth IRA's, each month I still write a check and send it in via snail mail. My goal is to make this action automatic as well. I want January to be the last month that I send funds to those accounts by paper, and have them automatically transferred each month. 

In the end, I think the more you can automate, the better. It removes the human element and temptation not to save. It bypasses the excuses, and assures execution. 

Tell Me: Are your savings automatic? Has anyone out there read The Automatic Millionaire or any other of David Bach's works? 

Money Monday: 2014 Coupon Savings

2014 is quickly coming to a close. As I began looking at my 2014 goals, the one that I was most interested in was my coupon savings for 2014. While I do track how much I save, I don't keep a running total throughout the year.

Total Coupon Savings for 2014: $1,704.39

My goal for 2014 was to save $2,000, and this year it looks like I missed my goal by $295.61.

But, there were some savings that I never calculate.

First, I am allowed to price match at my grocery store. I do this when I purchase produce, because its based on pounds purchased, or number of items. I don't have the time or desire to calculate those savings, so those are never included in my totals. (For example, if I have an add showing apples for .99C a pound, but my store is selling them for $1.25 a pound, I just show the cashier the add for the lower cost apples and they price match them to the lower price.)

Second, I don't calculate the rebates or incentives that I get when I purchase products. For example, at one store, I currently have $25.00 in rebates. I collect those rebates each week, and I am waiting until I earn $100.00 in credit before I cash them in. Again, I don't calculate that into my savings.

Finally, there are usually 2 or 3 mail in rebate offers that I participate in per month. These are the programs where you purchase a product, then mail in the upc code and receipt, and they send you the purchase price in the form of a check or gift card. Those are usually only a few dollars each, but they do add up. Again, I don't factor those monies into my savings totals.

In the end, when simply looking at the recorded numbers, it looks like I didn't meet my goal, but when I factored these other items into the total, I believe I ended up saving more than the $2,000 goal I set for myself.

In 12 months, we managed to save nearly $2,000 on things that we normally purchase. Those are real dollars, and real savings. For us, those savings allow us to stretch our dollars. According to the USDA, food prices in 2014 rose a little over 2% in 2014 over 2013. Using coupons and deals, we have been able to keep our food budget steady, and did not have to
increase it in 2014.

In addition, using coupons has allowed us to build an impressive stockpile of goods. Now, if we need razors, shampoo, cleaning products, or food, we have them here, in stock. That is a great feeling.

We have also been able to use coupons to purchase items for free or very cheap. If they are items that we don't need, or don't use, we give them to family or friends. We are also able to create bags to pass out to the homeless around our community.

If you are interested in coupons, and how to find deals, cut coupons, and organize them in less than an hour a week, please check out this post, or feel free to email me. I would love to help you out. Also, if you are interested, please feel free to check out my coupon savings page that I update throughout the year.

Tell Me: Did you do any couponing in 2014? How much did you save? 

**Disclaimer: I am not an extreme coupon user. I don't purchase coupons online nor do I dumpster dive for coupons. I spend $5.00 each week for a double issue of the newspaper to get those coupons, or I print them from sites on the internet. I have never purchased more than 6 items at a time, and have never used more than 1 cart while shopping. 

Money Monday: The Cost of Juicing

14 days ago, my husband and I decided to do a pure fruit and vegetable juice detox. At first, we were planning on doing a 3 day detox, but, after 3 days, we decided to keep going for a full 10 days.

The detox has been both hard and unbelievably rewarding. We have both lost weight, slept better, and feel healthier overall. We are currently continuing to juice for two meals a day, while eating a healthy sensible meal of salad and lean protein each night.

The lessons we learned from juicing will come in another post later this week, but for now, lets get down to the nitty gritty of our 10 day challenge.

To start, we needed to purchase a juice. We chose to purchase the Breville Juice Fountain from Bed Bath and Beyond. The list price was $149.00, but I found a coupon, and saved $30.00, so we only paid $120.00 (pre tax).

Then, we purchased the fruit and veggies. The first shopping trip was the most expensive, because we were not sure what we were going to like, and spent around $75.00. That first round of produce lasted around a week. Since then, we have done four shopping trips, and each trip has varied in price.

The four shopping trips cost the following (rounded up to keep the math nice and simple):

Shopping Trip 1: 75.00
Shopping Trip 2: 35.00
Shopping Trip 3: 35.00
Shopping Trip 4: 35.00
Shopping Trip 5: 35.00

So here we are, day 14 of juicing, and while we are no longer doing a pure detox. Again, we are still juicing during the day, and eating at night.

The grand total for 10 full days of juicing: $335.00

This is the first time that I have calculated how much we spent on this challenge. Honestly, that number is a bit shocking. That is not cheap at all! But, when you pull out the cost for the juicer, the cost for the produce was around $215.00.

As I stated above, this was not a cheap experiment, but we knew we were going to spend more than we normally would on food this month. But, I am also taking into account the long term effects on our health and our budget. We see food as fuel, and while we are not opposed to taking medicine, we both prefer to take as little medicine as possible. By spending a little more money now, on the front end and improving our health, we are saving money on the back end because we don't have to spend those dollars on health care. Therefore, I have no problem spending the extra money.

Money Monday: Using Money as a Motivator

2 weeks ago, my husband and I were looking at the calendar and realized that Thanksgiving was only 4 weeks away. After clearing a bag of Oreo's in less than a weekend, (let's be honest, it was in less than day) I knew that I wanted to feel better before the holiday season, so I proposed an idea to my husband, a challenge. 

The $25.00 challenge:

The Rules: No sweets, no chips, no cokes, candy, juice, cookies, cakes, pastries, or refined sugar of any kind, from November 1-November 28th (Thanksgiving).

The Reward: Each week, if you do not eat any of the above referenced foods, as fun money, each person will get an additional $25.00 in fun money to spend however we like.

The Punishment: If you fail, if you eat any of the above referenced foods, you don't get your $25.00, it goes to the other person. If we both fail, then no money for either of us, at all. 

So far, we have been successful and each collected on our reward. We have tried challenges in the past, and we never stuck to them, but by making it a challenge involving money to motivate us, we have been more successful.

That led me to wonder, should you use money as a motivator?

Growing up, my parents didn't have much money, but, they did make a point reward us for our grades. In their eyes, school was a job and report cards were the fruits of our labor. When it was report card time, we received money for A's and B's, (about $20.00 total if we earned all A's and B's). They saw it as a way to keep us motivated.

On the other hand, my husband was never given money as a reward. He began working at a very young age, and he learned that if he wanted or needed something, he needed to get a job and earn the money in order to pay for it. 

We also have friends that use money to motivate their children to read and write essay's on books that they deem important. 

For us, we are on a budget, and we keep a pretty tight reign on our spending. We only get a small amount of "fun money" or "blow money" each month, so when there is an additional amount on the line, we are motivated. 

My question is, when does it stop becoming motivation, and turn into bribing? In our eyes, using money to motivate is done by setting the terms and rules in advance, but bribing is done in the moment. 

Tell Me: Do you use money as a motivator? What are your feelings on using money to motivate yourself, your kids, or others?

Money Monday--Giving Cash

 The holiday's are here. Its almost time when we as Americans lose our minds (you know we do) and start shopping. It seems as if we treat shopping as a sport, pitting one store against another, beating each other out for the best deal.

 

I made the decision earlier this year that I want to get ahead of the holiday's and get most of my shopping done by the end of November, so that way I don't have to fight the holiday crowds and limit my exposure to the chaos.

 

A few weeks ago, my husband and I sat down and created our list with the money we have saved throughout the year, and allocated dollar amounts to each person that we were buying for. 

 

With the exception of a few gifts, the majority of what we are giving is either cash or gift cards. 

For some of our best friends, each year we send a card with a Visa gift card, and tell them to enjoy a date night on us. 

 

For many of our family and friends, rather than shopping for a "gift" we end up giving them cash. We try to give it in a creative and fun way, but in the end its just cash. 

 

When my husband I were first married, we used to spend a lot of time shopping for a gift for each other. But, over time, we began to realize that we each are a bit picky, and would rather be given cash to spend as we like. In our monthly budget, we each get a certain amount of fun money, but sometimes, that is simply not enough for the things we want, so we are able to supplement with money we received from Christmas/birthday's throughout the year. 

 

For us, giving someone cash is a great gift. We don't ever want someone to feel obligated to use or keep something they don't want, so why not allow them to spend money however they want. 

 

I know that some folks consider giving cash or gift cards tacky, or a cop out, or unsentimental for not buying a specific gift. For us, we don't feel that way. I think giving someone cash, and with it a well written, thought out, and meaningful card means more than a trinket.

 

There are certain things that I have received in my life that mean the world to me, and I would never part with. But, there are very few Christmas gifts that I was given that I remember. 

 

Tell Me: Do you give cash and gift cards to people? Is the practice trash and tacky, or do you think its practical and smart?

Money Monday: Warranties, Returns, and Replacements

Many of the things we purchase have warranties of some kind. I have never been one to take advantages of warranties for smaller purchases. When my husband and I make large purchases, such as at.v., washer/dryer, refrigerator, ect., we often purchase the extended warranty. We may never have to use it, but it gives us a piece of mind that we have it in case our product did not function property. 

But, for smaller items, historically, I have never taken advantage of the warranties offered by the manufacture.

A few weeks ago, I was drinking water from my Turvis Tumbler, and a friend noticed that it was extremely discolored and cloudy. He mentioned that Turvis had a lifetime warranty and all I had to do was send it in and they would replace it for free. I went to their website, filled out a form, grabbed a box from work, and sent my cup in. Two weeks later, I received a brand new cup in the mail. 

I did the same thing with the cup I use at the office, a Bubba. The insulated piece unattached from the outside holder. I went to the site filled out a form, sent it in, and again, less than two weeks later, I received a new cup. 

Those two returns ended up savings me money. Rather than purchase new cups, I spent about $12.00 in postage to receive $40.00 in new products. 

I bring all this up, because as I said, prior to these returns I never used the warranties for the products I purchased. 

Back in August, I purchased a new pair of running shoes. I live in the Brooke's Adrenalines. They are my go to running shoe, but they are not cheap. At $120.00 a pair, I try to get as much mileage out of them as I can. I had my new pair of Brooke's for about 3 weeks, and put about 60 miles on them, when the fabric along the edges began to tear. I lived with it for a few day's and finally, encouraged by my experiences with the two cups, I sent Brooke's an email and explained the problem. In return, they asked me to send in photos of the damaged shoes. Within 24 hours, I had a reply apologizing for the problem, and that I would be receiving a replacement pair of shoes within 3-5 business day's. Less than a week later, my new shoes were waiting for me on my door step. 

I was pleasantly surprised. With the exception of some torn fabric, the shoes are in great condition, and I am still running in them. And, I have a pair of brand new shoes in my closet when these wear out. For Brooke's, I am sure this was nothing but a blip on the radar, and cost them very little. But for me, a person who loves to run but will never win a race, nor sponsorships in this lifetime, it meant a great deal. I won't forget their great customer service was, and it solidified me as a customer for a very long time. 

In recent weeks, I've learned that there is no harm in speaking up. There is no harm in using a warranty for a product that you purchased. I am so much more cognizant of warranties and guarantees now as a consumer, and I am willing to go to a company to ask them to repair or replace my purchase. 

I am a firm believer that we vote with our dollars and that companies will listen to us when we speak up. 

Tell Me: Do you use warranties? Any companies worth bragging about for their warranty policy? 

Money Monday: Spending on Holiday Decor

The holiday's are almost here. In just 5 short day's millions of kids will go trick or treating, and then, the holiday rush will unofficially begin. Shopping, parties, cooking, and wrapping of gifts will work its way into our lives. 

We all know that Americans spend billions and billions of dollars from November-December on gifts and decor for Christmas. But, what about the holiday's that precede Christmas and New Years?

About 2 weeks ago, I was out running, and came across a house a few miles away that was already decorated for Halloween. These people spared no expense for their yard. 

This is really creepy. 

 While I was running, I began to wonder, just how much do American's spend on Halloween? 

According to the National Retail Foundation, the average American spends around $75.00 on Halloween. That includes costume, candy, decor, and party supplies. In 2013, as a country, we Americans spent $6.9 billion dollars on this holiday alone. That is a 55% increase since 2005. 

That lead me to wonder, why such a drastic increase for this single holiday?

I have no scientific research to back this up, but my guess would be the rise of Pinterest. I know for me, and my circle of friends, we don't make or decorate without heading to Pinterest first for ideas. 

On a personal level, Halloween has always been one of the cheaper holidays. Growing up, my parents didn't purchase us packaged costumes. If we wanted to dress up, we needed to plan our costume from what he had in our closets and around the house, or we could go to a thrift store and come up with something that way. Most years, my brother and I were able to piece together costumes for less than $10.00. 

As an adult, my husband and I don't spend a ton of money on halloween. For us, our biggest expense is buying candy to pass out. Last year, I think we spent around $15.00 for a few bags of candy. Our neighbors tend to gather around outside and the adults hang out on the sidewalk or in each other's yard passing out candy and talking. 

As far as holiday decor, I rarely decorate for holiday's. We have never spent a holiday at our home. We always travel to be with family, and so I have never put the time or effort into it. Plus, I tend to be a little Type A, and a minimalist, and I don't like to see things moved around or out of place. 

Tell Me: Do you decorate for Halloween or throw a party? How much do you spend? What is your Halloween tradition?

Money Monday: Why we don't use credit cards

5 years ago, my husband and I sat down on our couch, took out a pair of scissors and cut up all of our credit cards.

Then, we took a look at our accounts, totaled all of our extra cash, and left 3K aside as an emergency fund. With just a few thousand to use, we decided to pay off as much of our credit card debt as we could that day.  Once each credit card was paid in full, we called the bank and cancelled our card. One by one, the credit card debts were paid, cancelled, and we vowed that we would never be in credit card debt again.

One part of the process that surprised us was how hard to was to actually close each account. The banks tried to offer us perks (higher credit limits, an upgraded card, concierge services, ect.) and once we declined, we were put through to a supervisor. Then, the supervisor tried to sweet talk us with the perks again. When that didn’t work, they began the scare tactics, and tried to bully us into keeping our cards. It took persistence, determination, and focus for us to remain on track.

But, we did it. We stuck to our guns and kept pushing towards our goal.

I remember after we cancelled our last card being scared. I never realized how tied I was to that piece of plastic. That card was our emergency fund. It was the safety net. Again, we pushed through those feelings and stuck with our plan.

Why did we give up credit cards?

First, we found that when we used credit cards, we spent more money.  This may not be the case for everyone, but when we bought on plastic, it was so much easier to buy more items.

Today, we utilize the envelope system and use cash for food, gas, dry cleaning, pet supplies, home goods (cleaning, HBA, make up ect), and entertainment. Once the money is gone, its gone and we don’t get to spend any more that month. Using cash is what lead me to becoming a couponer because when I bought a cart of groceries with my credit card, I didn’t think about price as much. But, when I sit in the store parking lot and count the cash in my envelope, I have no choice but to stay on budget. Sometimes we have to sacrifice and not buy things we want this week, but I can normally find a coupon for it, so we usually are able to get that item in the next few weeks with a discount.

Second, we read the fine print. The contracts with the credit card companies favor the banks, not the consumer. CC companies advertise a fixed rate, but in our agreement, they were able to increase the interest rate just by giving a two week notice.  

Third, we didn’t trust the credit card companies.  Credit card companies have spent hundreds of thousands of dollars to study the consumer. They have sociologist, scientist, psychologist that study us and our behaviors. They study how we act and think in order to get us to spend more money. They try to sell us on a life that quite frankly we could not afford on our own, but with their credit card we could achieve.

Finally, we wanted to be self-reliant and free. We wanted to call the shots in our own financial life, and didn’t want to be tied to an institution that tracked our habits and used that information in ways that were not helpful, but harmful.

Are we missing out?

Maybe.

Sure, we don’t get frequent flyer miles, or discounts at the store, but in most cases, I can find a coupon code online and get those savings anyway.

But, what we don’t get in rewards, we more than make up for in piece of mind. We never worry about what the mail when it comes in because we know there is no bill out there with our name on it that we forgot about.

In the end, living without credit cards is not for everyone, but for us, it works. The beauty of personal finance is that its personal. If you do something that works for you, that does not for me, that’s great! I don’t think one decision is better than the other, they are just different. As long as you have a plan and working that plan, then good for you!

Tell me: Do you use credit cards? If so, how many do you have?  If not, when did you get rid of yours? Why did you get rid of them?

Money Monday: The Cash Envelope System

5 years ago, my husband and I decided that we were done using credit cards, and switch to using cash and our debit card.

Our cash envelope wallet. 

We were trying to get out of debt, control our spending, and simply of financial life.

For us, the envelope system means that we use cash to pay for the majority of the things we purchase through out the month.

Here is how our system works:

We withdrawal cash twice a month, on the 1st and 15th. On the first, withdrawal pull cash for the following categories for the month:

Groceries: Self explanatory

Entertainment/Eating Out: Restaurants, concerts, events, ect.

Pet Supplies: Treats, brushes, food, ect.

Dry Cleaning: Self Explanatory

Home Goods: HBA, Cleaning Supplies, Toilet Paper, ect

Gas: Have to keep the tank full

Fun Money: The money my husband and I get to spend however we please.

At the beginning of the month, we put a set amount into each envelope, and that is all we get to spend for that month on that item. (Barring an emergency of course).

We have found that if we are more likely to spend more money when we don’t use cash, so this is a really good technique that we have found to help us stay on or under budget.

For some reason, for us, me especially, when I use plastic, even my debit card, it does not register that I am spending money. But, when I have to pull out those green dollar bills every time I shop, and I see my envelopes getting thinner and thinner, I think twice about what I buy. Which is why I because such a fan of using coupons. 

On the 15th, we do our second withdrawal. This time, the money we pull from our account may not be used on a monthly basis, so we it will continue to grow if not used. At this withdrawal, we pull money for:

Christmas: We save a set amount each month all year, so that when December comes, we get to spoil the people we love presents!

House: This is for house decorating, minor home improvement projects, furniture savings, ect.

Car: For car maintenance like new tires, oil changes, ect,

Fun Money: A second disbursement of blow money for each of us.

My husband and I each get $40.00 a month in fun money to do whatever we want with. ($20.00 every two weeks) This can be used to eat out, buy a purse, buy shoes, buy make up, buy books, well, that’s what I do with my money.

Finally, at the end of the month, we combine all the cash we have left from the first withdrawal, and as a bonus for staying under budget we each get 10% as a little end of month bonus. The rest gets put into our spontaneous fund that we use as spending money when we buy things for a party we host, or extra spending money when we go on vacations out of town, or for a special night out.

Using cash helps us stay on or under budget, and simplifies our end of month account reconciliations, because there is a lot less activity in our checking account.

This system works great for us. For some, it may not be feasible, and may be easier to use some other system. Doing this motivates us to stay disciplined and encourages us to come in under budget each month.

Tell Me: Are you on the envelope system? How does it work for you? How do you budget and track your different expense categories?

Money Monday: Quality vs Quantity

The Scenario: You budget $300.00 to spend on clothes, and you have to spend it this week, where do you go?

Do you hit up Target and stock up on bargain tops? Do you head to H&M or Forever 21 and buy basically the entire store. Do you head to a mid priced store and buy a few bags of clothes? Do you head to a mid to high store like Banana Republic, JCrew, or Ann Taylor and get a few basics? Or do you hit up one high end store and buy one high quality item?

A few years ago, I would have headed straight to Target and filled my cart with their tops and workout gear. Then, I would have rounded out my day at Gap, and picked as many items from the sales rack if I could until every single cent was spent. 

Today however, my m.o. is different. Rather than buying as many cheaper lower quality clothes as I could, I am a bit more discerning. I would probably head to Banana Republic and search for some high quality pants and tops to last a few years. Over the years, I've noticed that my tastes have changed. I am content with fewer clothes, as long as they will are classic pieces that fit me really well, and feel good on my body. 

Another area that we have changed our tastes is in our food selection. When we were first married, we filled out carts with cheap treats. Lots of refined foods, refined sugars, and cheap meat. Now day's we try to fill our cart with fewer refined foods, and more whole foods, organic meats, and quality grains. While we are not 100% organic, we make a point to buy only organic meats, and as many organic fruits and vegetables as our weekly budget allows. 

In real terms, that means we have to go meatless a few days a week in order for us to eat organic meats. It means we need to fill up on sides like fruits, vegetables, and grains, rather than make meat the center point of our  meal. 

In the end, our choices mean that we get to do less, have less and do without certain things. But, filling our home and lives with higher quality foods, clothes, furniture, and healthcare items, we have found that the things we do own last longer, look and feel better. No better, no worse, but for us, it is a choice we are happy with.

Tell Me: What would you do? 

Money Monday: Six Months Without Cable

Back in April, my husband and I made the decision to get rid of our satellite t.v. service. Our contract with Dish expired in January, and we never renewed the service. Instead, we subscribed to Aereo.  For us, Aereo was the perfect solution. We were able to watch television on our iPads, cell phones, and computer, anywhere. Plus, it provided 20 hour of DVR service, all for $8.00 a month.

Then, the Supreme Court decided that the way Aereo operated was illegal, and shut them down. 

After Aereo shutdown, we considered signing back up with satellite. But, when looking at it, we could not justify spending more than $600.00 a year to watch t.v. We ended up doing some research and found that there are some modern, high powered antennas that provide great reception, without a monthly fee. We started at the bottom of the totem pole with the cheapest antenna. It was about

$25.00, and didn't work for us. 

This did not work for us. 

This is the antenna that we have now

We returned it, and stepped up to the $50.00 level. That one worked, but the reception was spotty. Finally, we bought a higher priced antenna, the ClearStream Micro XG Indoor LongRange Antenna, which cost around $100.00. We have been using this one for about 3 months now, and it works well for our purposes. Sure, the picture can get spotty, but its nothing terrible. Plus, it is more sleek and modern than the others, so aesthetically, it looks better. 

In the end, for us, spending $100.00 for basic cable worked. We subscribe to Nextfilx, and so for $8.00 a month, we get a ton of movies and series to choose from. Plus, nearly every cable station has an app that you can stream their shows for free. If none of that works, then we do a quick YouTube search, and can normally find anything we want that way. 

Towards the end of our satellite contract, we found that we were spending way to much time on the couch. We would come home from work, eat dinner on the couch, clean up, and plop right back down on the couch and sit there for hours. We felt lazy and unproductive, but we lacked the discipline to turn off the t.v. and do something with our evenings. 

Now, we tend to come home, cook dinner, watch an episode of The Office on Netflix while cooking, eating, and cleaning up. Then, we will head outside to take a walk, play with the dogs, chat with the neighbors, work in the yard, or run errands. Given that we have less options at our fingertips, we are less likely to sit on the couch for hours on end. 

I can honestly say that I don't miss cable. There is nothing I want to see so badly that I am willing to pay over $100.00 a month for. 

Tell Me: Do you pay for t.v. service? What do you use? What are your favorite shows?

Money Monday: Ashamed of Success

A few weeks ago, some clients and I were waiting for a meeting to start, and we sat around a conference table chatting. Looking around the table, it was easy to assume who made the most money and who made the least.

During our small talk, the subject of vacations came up. Some in the group shared about their road trip to the mountains, others shared their experiences with staycations, while another meekly explained that he had been on a European tour for 3 weeks earlier in the summer. Right after he shared, he changed the subject, and steered the conversation in another direction.

Later, as I was processing the meeting, I had to wonder, was he ashamed of his trip? Clearly, he dropped quite a bit of money. Why was he so hesitant to talk about it?

While it is not always fair, it is human nature to rank each other. Tallest to shortest. Most beautiful to least. Wealthiest to poorest. It was easy to see that as the owner of a very successful company, he had enjoyed a high level of financial success. He worked hard, and has been rewarded, handsomely.

It seems to me, that for those who have excelled and found success in this economic climate, many seem to be ashamed of their wealth. Is it humility? Is it meekness?  Is it out of respect for others who have not fared as well, or worked as hard?

In this economic climate, especially among the younger white collar workers, it seems as if there is a trend to hide their successes, and play up their liabilities.  Its almost like because many American's have struggled since 2008, that those who have made gains must have been ill gotten, or just lucky.

Tell Me: Are you ashamed of your success? Have you seen this trend too?

Money Monday: Food, Groceries, and Couponing

According the the Wall Street Journal, overall food prices will increase 2.5%-3.5% in 2014. The cost of beef products will rise 5.5%, fruits and vegetables 2-3%, and cereal and bakery goods will rise 1.5%.

In addition to rising food costs, studies are showing that salary's are stagnant at best, and in some cases even falling. Couple rising cost of living, and lower "real" salaries, it is harder and harder to make ends meet for the average family.

For budget conscious families like us, we knew we needed to find a way to stretch our money because we don't rely on credit cards to bridge the gap between income and expenses. For us, we found that couponing has become a vital practice to stay on budget each month.

I started couponing several years ago, and like any new endeavor, I was not very good. I was not efficient, I was not saving much money, and it didn't seem like it was worth the effort. But, after several rounds of refining my methods, I have been able to streamline my system. Each week, it takes me just under and hour to clip, cut, print, and organize my shopping for the week.

As for the actual shopping, in a normal shopping experience, I can usually get in and out of store within 20 minutes.

Through this practice, we have been able to build a small stockpile of toilet paper, paper towels, laundry detergent, Health and Beauty aid, food and more. If we did not coupon, it would be difficult for us to stay on budget each month. On average, I can save 30-40% each time I shop. So far this year, I have saved $579.00. 

In addition to couponing at the grocery store, we have also become more accustomed to couponing to supplement our entertainment and social lives. Before eating out, we will search for deals at our favorite restaurants, or search for savings before shopping for clothes or furniture.

Coupons have become part of our lifestyle and I don't see us discontinuing our practice in the future. For us, it simply makes financial sense.

Tell Me:  What are some ways that you save money on your day to day expenses?

Money Monday:Family and Money

Much has been made about my generation. As millennial's, we graduated right before the great recession. We had our degrees, student loans, and idealistic aspirations. We were ready to light the world afire.

Then, the bottom dropped out. The economy sank, plans changed, and the lives we thought we were going to lead suddenly seemed out of grasp. Suddenly, millions of us moved from our college apartments back to our childhood bedrooms. We were called the boomerang generation, and were accused of taking advantage of our parents. We took jobs we didn't want (I myself worked as a substitute teacher, hotel maid, and at a day care) and eventually made it out of the nest. It took a bit longer and life looked a lot different than we wanted. But, after slogging through, we made it out of the nest, and made it on our own. 

Now, however, the tables have turned. Our parents are moving into the next phase of their lives, retirement. Their careers are coming to a close, and they are reworking on their own budgets to see if they have saved enough money. Its a scary thing to quit work and live on your savings for the remainder of your life. Many baby boomers are realizing that retirement may be a little harder than they imagined. They spent so long taking care of their kids, that for some, they neglected to take care of themselves. 

So now, the question becomes, is it the child's responsibility to help the parent financially? In Eastern cultures, it is very common for multiple family generations to live under the same roof, or next door to one another. Western culture is one of the few that encourages such extreme individual independence.

Forms of help 

Family loans. Children can loan parents money for a variety of reasons. To help pay off high interest consumer debt, car purchases, or cover medical bills. 

Monthly subsidy. A fixed amount may be given to the parents each month to help cover household expenses. 

Household merging. For thousands of years this has been common, but its becoming more and more popular in the US. Parents are now moving in with their child, their spouse, and their grandchildren. The parents pay a very low rent, and part of the monthly bills. In addition, they often help with child care and household chores. 

Gifting. Another way for children to give back to their parents is to buy the things they need. Groceries, clothing, lawn care and taking care of other necessities are some other ways children and give to their folks. 

Money and family can be sticky situations. There is something called the "powdered butt syndrome." That means, if they powdered your butt, they don't want to hear your advise or thoughts on money. Though the discussion may be tricky, it is a necessity. 

The best thing families can do is to be open and honest about their financial situation as early as possible. As always, the great thing about personal finance is that you have the ability to change your situation, no matter your age.

Are your parents getting to retirement age? Do they have a plan? 

Money Monday: The Downfall of Aereo

About 3 months ago, my husband and I were looking at our budget, and trying to find areas to cut expenses. One opportunity for savings was our satellite service. We were paying more than $110.00 each month to watch a handful of channels.

Through some friends, we heard about Aereo. That evening, we went to the site, signed up, paid $12.00 and we had streaming service. For us, it was perfect. We were able to get a few major channels that we wanted (ABC,NBC,CBS, and Fox) and did not have to pay for 80 channels that we had no interest in watching.

Plus, we were able to access Aereo on our phones, tablet, t.v., and computer. We are increasingly mobile, and we cherished the fact that we could access t.v. basically anywhere.

But, on Saturday, we received an email from Aereo noting the Supreme Court decision that made their business model illegal, and for the time being, they were shutting down operations.

Frankly, I disagree with how cable services are provided to us in America. We seem to have 2 options: buy everything or buy nothing for subscription based entertainment, irregardless if we want certain channels or not. That would be like going to the grocery store to buy grapes, but, if you want grapes, you have to buy every other type of fruit, no matter if you use it or not.

Why should I have to pay for the fishing,hunting, and golf channel if I never plan to watch them? I am not forced to buy brussel sprouts each month. I think they are disgusting and I will never eat them. Why would the government try to force me to buy something that I don't want?

In the end, the current system simply does not seem fair to consumers. It seems to benefit the big corporations. The Supreme Court made their decision, and we have to accept it.

Weigh in, what do you think? Any other former Aereo users out there?

Money Monday: Adding An Income Suite to our home

My husband and I moved into our home nearly 2 years ago. One year, and 364 days ago, I expressed a desire to build an apartment over our garage.

Currently, we do not have an apartment over our garage. We have talked about it tirelessly. But, we have never moved on it. By our rough estimation, it would cost nearly $30,000 to build, which for us, would be a significant investment. 

The Numbers

Build Out $30,000

Rent         $     500

Payback            60 months

For the size of apartment that we would be able to build over our garage, the current market rate is around $500.00. Given that rate, it would take 5 years of rental charges to earn that investment back, 5 years before we would begin to see a profit. 

For us, right now, that is a bit too long term. Given our financial philosophy, we are unwilling to take out a loan to pay for the work, so it would be several years before we could commence with the project. If we had an extra $30,000, it would be smarter for us to pay extra on the mortgage or to apply to a recast, so that our savings would be realized now. 

In addition, we may not be in this home for another 5 years. Our goal and plan at this stage of the game is to increase savings and continue to pay a bit extra every month on our mortgage in order to cut down on the length and total interest paid over the life of the loan. Once we move, we would like to turn this home into a rental. 

As much as I want a garage apartment, realistically I know that at this time it is not a smart decision. 

That is why I am so passionate about personal finance, because it is personal. There is no right or wrong answer because we each have our own goals and plans. 

What would you do? Would you build it? Do you have a rental? What are the pro's of owning a rental? What are the con's to owning a rental?

Money Monday: The Cost of Competitive Sports

For the next few weeks, the eyes of the sporting world will be on Brazil. It's World Cup time, the biggest soccer tournament on the planet. 

Watching games this weekend reminded me so much of my childhood. In our home, we were all about sports.As a child, I started showing an affinity for soccer fairly early on, and my parents encouraged me to play at the highest level I could. But, playing at such a high level came with a really big price tag. When I was about 12, my folks realized that I had outgrown most of the teams in our small town. I was not being challenged, and I was growing bored. When I was invited to try out for a division 1 team in Houston, about 45 minutes away, my parents drove me to try out. Turns out, I was good enough to play at the higher level, and a decision was made that I would join that team, and ultimately, it would change our lives. 

From that point forward, my life and my parents lives revolved around one thing, my hobby, soccer. Practices were held 3 times a week, so my mom had to drive me 45 minutes each way to practice. Scrimmages were held on Saturday mornings, so that is another hour and a half on the road. Then, games were held on Sunday afternoons, all over Houston, and they could be held up to 2 hours away. On any given week, we were in the car for 8 or more hours just driving to soccer practice and games. 

Then, our team began to travel. We played in Washington, Florida, Colorado, as well as all over the state of Texas. That meant, more flights, more hotels, more meals, and entertainment money to spend at the tournaments. 

Thinking about my soccer career, I am eternally grateful to my parents, but sometimes, I have to wonder, how much did it cost? All the gas, meals, uniforms, and fee's, what could they have done with that money rather than spending it on me to play a game?

Estimated financials for 7 years of club soccer:

Club Fees: Around 1,000 per year  (7,000)

Uniform Fees: New Yearly uniform around 150.00 (1,050)

2 Sets of Cleats per year 100.00 (1,400)

Total: $ 9,450

By my estimation and rough math, that is nearly $10,000, and those are only the fee's I can calculate. I cannot even begin to estimate the amount of money spent on gas, hotels, food, and medical attention due to various injuries over the years. 

Was it worth the cost? If they had to do it over again, would they? Knowing what they know now, was it a smart decision?

Soccer gave me purpose. It gave me a social group. It gave me self esteem and confidence. It kept me out of trouble. I loved every moment of it, and I never once thought of the cost or time commitment. 

Luckily for us, all that work paid off and it gave me a full ride to college. Everything was paid for--tuition, housing, books, and food. I got a monthly stipend from the school for any overages from my scholarship money. That is nearly $70,000 worth of education that my family did not have to pay for. 

Given that estimation, I think it would be safe to say that my parents came out ahead, so financially, it was a smart decision. 

I would not change one thing about the way I grew up, and I am so grateful for the opportunity. In the end, it comes down to the family, the child, and their financial situation and plan. 

What would you do? Do you think club sports are worth it?

Money Monday: Time vs Money, Which is more important?

Imagine for a moment that you are having your yearly review with your boss, and she presents you with this scenario.

Employee, you are doing a great job. I am so impressed with all you have done and all you have accomplished this year. As you know, this next year is going to be even busier, and we have a lot of projects coming down the pipe, and we are running a lean staff right now, and have no plans to hire more people. 

In recoginization for all you have done, you will be able to choose one of two options. I can either give you a 5% raise, or I can give you a 5% increase in time off to use as you choose. 

What would you do?

We are all busy. We all have too much to do, and too little time to accomplish it all. For most of us, the work day is jam packed with to do lists and meetings. Our mornings are filled with workouts, emails, and preparing for the day. Our lunch hours are spent running errands and making personal calls. Our evenings are spent doing homework, making dinner, and trying to find a few moments to zone out and wind down from the day. The weekends are filled with grocery store runs, social obligations, soccer games, and catching up on chores. 

All of this begs the question: When is it time to pay someone else to do the things we no longer have time for?

In our America today, what is more important, time or money? When is it time to pay someone to do things that we can do, but no longer have the time to do them?

At what point do you hire the kid down the street to mow your lawn? Is it time to ask your neighbors cleaning lady to stop by once a week and do the laundry and clean the house for a few hours?

If you didn't have to clean, or do the yard, or cook dinner a few nights a week, what would that free you up to do? Would it allow you spend more time with your kids?  Could you sit down and write the great American novel? 

What would you do if you had more time? 

Let's say our employee above makes $60,000 a year. On average, that comes to around $30.00 per hour. The kid down the street will mow your yard for $40.00 a week. That means you will give that kid the money it took for you to earn in 1 hour and 20 minutes of your day, once a week. 

Would you do it? Is $40.00 a week worth an extra hour a week of free time? 

For me, at this point in my life, the answer is no. I always feel like I can be more efficient so that I can accomplish more. I will often look for ways to work smarter, rather than harder. I can cook, do laundry, water the grass, talk on the phone, and put up the groceries all at the same time. 

I believe  I could do something better with those dollars than spend them on a service I could do myself. 

But, there is a downside to multitasking, nothing gets my full attention. I miss key moments in conversation, the rice gets slightly overcooked, and the lawn may be a little too saturated. Am I OK with those things, yes I am, because I don't have a desire to be perfect. The desire to fit it all in is stronger. 

Tell me: What is more important to you, time or money?

Money Monday, On a Tuesday: The Art of Compromise

So sorry y'all. this was supposed to go live on Monday, but for some reason, it didn't. 

Its not uncommon in marriage to have a different financial personality that your spouse. One may be a spender while the other is a saver. One may have been raised in a wealthy family and the other was raise on food stamps.

For us, generally speaking, we are on the same plane financially. We know our goals, we know our plan, and we are following the same financial map. Where my husband and I differ though, is the speed at which we pursue those goals.

Right now, the only debt we have is our mortgage. When we purchased our home, we borrowed less than half of what we were approved for. We got a great rate and our monthly payment is very management for us. We live in a modest home in a working class area of the city. Because this was our first home, we opted to take a traditional 30 year mortgage because we wanted to ensure that we were not "house poor." We knew we wanted to maintain our lifestyle. We didn't want to have to say no to people and experiences because of our home mortgage.

We also knew that we did not want to pay off the mortgage in 30 years, we wanted to do it much sooner, which is the fork in the road for us. While we both want to pay off our mortgage early, what we tend to disagree on is the speed at which it is done, at to what extent we will cut and sacrifice our lifestyle to do so. If it were me, I put every single extra cent towards the mortgage. I would cut my lifestyle as much as I could, and I would pay the house off as fast as possible.

My husband, while he does want to pay off our home as quickly as possible, does not entirely agree with how much I want to put towards the mortgage each month.  Yes, he wants to pay it off early, but he also wants to make sure that we enjoy our home and our lives. We like doing home improvement projects. He likes taking down walls and building new ones. He wants to retrofit our lighting to make our home more energy efficient and safe. He wants to add a deck and pergola so that I can enjoy the back yard all year long.  He wants to replace aging equipment and features so that when we sell, we will get a high dollar amount for our home. He tells me all the time, how much he wants to make our home as nice as it can be for me.

While I want to do all of these things, and I appreciate all he wants to do, they all require a capital investment.

What do you do when you have two people under the same room with the same goal, but going at different speeds?

You compromise.

We decided that for every dollar we put towards home improvement, we will put .50 cents towards the mortgage. Before any project can begin, we must fund it to 150% percent.

This has worked out beautifully for us. He get's his projects, I get my extra payments. It is really a win win compromise of us.

In the end, we realized just how much we need each other. If it were not for him, I would never go anywhere, never see anything and have no friends because I would be to cheap to do anything. What is the point of a home if you can't share it with family and friends?

How do you compromise different goals and desires? Are you and your spouse on the same page and same speed?

Money Monday: Are Vacations a Necessity?

For the modern professional, there is a question that we must ask ourselves on a daily basis.

Where does work end, and personal life begin?

20 years ago, the dividing line was pretty clear. The office and all the work were there, in the office. If an employee chose to arrive early, stay late, work through lunch, or bring work home, it was their choice.  As soon as they put their work away, they were done for the day or night. Maybe not mentally, but the line between work and home was much more defined.

Today, that is not the case. For many of us, we operate so much of our work through our cell phones, and those phones are never far from our reach. The last thing I look at before I go to bed is my email. The first thing I do in the morning is check my email.

Thanks to technology, I can do 90% of all my work from my phone if I needed to. If I can't do it from my phone, then I can whip out my laptop, log in remotely, and handle any and everything off site.

Again, this begs the question...Where does work end? 

I don't know anyone who only works 40 hours. I don't know anyone who won't pick up their phone and shoot emails for work during dinner. I don't know anyone who can't log onto their work computer from a bar and make things happen at 11:00PM at night.

Do you?

For us millennial's, the recession hit us hard, and has made many of us even harder workers than before. Those memories of the hard times are just beneath the surface. Our response is to work harder, work faster, and work all the time.

Given that we have now become overworked, overwhelmed, and over digitized, for us, it seems like we have no choice but to take vacations. Take time to get away from the office, to turn off our phones, iPads, and laptops, and try to decompress, even for a few days.

I don't know that vacations are a luxury that my generation can live without anymore. We are so glued in, tuned in, and always "on" that it almost seems like vacations need to be mandatory.

We need that "off switch." We need to not answer or look at emails for a few days. We need to be disconnected for a time. A time to recharge our internal batteries.

Whether we go to the beach, the mountains, or the lake, I know more and more people my age, who have to do more than just get away from the office, they have to get out of town in order to recharge themselves. They have to turn off the phone and disable email.

And, I know a lot of people who feel guilty of doing so.

But, in the end we have to. We can't keep working ourselves into the ground, doing more with less, and putting everything we have into our work.

What to do you think? Are vacations still a luxury or are they a necessity now?