In the News

I read a lot of personal finance blogs, money saving blogs, and even frugal living blogs. While I find a lot of inspiration from them, and a lot of good information, I also like to peruse articles that have been in the news or that are available on financial websites. I think http://www.bankrate.com/ is an excellent source of information and I wanted to share an article a friend of mine sent me from their site:

7 Solid Ways to Save $1000 in a Year

Here is the breakdown of their 7 ways and what I think:

1. Losing the data plan on your cell phone – I actually think this is a great idea. It’s something I’m contemplating right now. I rarely use the advanced features of my phone with the exception of email and GPS. It’s definitely something I’m considering.

2. Skipping Starbucks or Jamba Juice – I don’t actually do this. I’m not a Starbucks every morning girl. What I am guilty of is my breakfast burrito habit - $4.85 every week day for a burrito and a soda. I’ve pretty much weaned myself off of this for a savings of about $1260 per year. I would reinterpret this as your $5 habit. What thing that you tell yourself is just 5 bucks can you give up?

3. Avoid convenience foods like pre-shredded cheese or pre-diced onions – I’m working on this one. I think the savings is hard to track although I will see it in the overall reduction of my food costs I’m sure. Also lends itself to the upcoming feature on my blog – Make It Yourself Monday

4. Lose your Gym membership and ride a bike instead – I don’t agree with this one for me but I’m sure it could benefit some people. I live in Arizona where the temperatures in the summer are enough to melt your face off. I found a discounted gym for $10 per month, no contract. In the height of summer I will be walking my way to being fit by 40 on a treadmill in an air conditioned gym. I’m considering switching to an outdoor form of exercise once the temperature cools off, from November to March. Since there is no contract I can do that and save myself $50 per year.

5. Put $50 into savings every two weeks – I think this is great! I intend to do more but it’s a good jumping off point. $50 in savings every 2 weeks would give you an annual savings of $1300.

6. Lose your land line – I don’t have one. I have a very money savvy friend who is having a hard time giving hers up. She’s looking into Magic Jack.

7. Investment fees – this one doesn’t really apply to me. I only have my one 401K through my current employer with an excellent match percentage and am fully vested.

So what do you think of the article? Are any of these ideas ones you would like to implement? Have you already and how successful have you been? Can you think of any other ways to save $1000 per year?

Things I Don't Spend Money On...

I saw a post on one of my favorite blogs, Money Saving Mom, called 7 Things We Don’t Buy. I’ve seen a few other bloggers do the same thing and I thought it would be a good exercise for me – to see if there actually is anything I don’t spend my money on. I was actually surprised to find that there are quite a few things I don't spend on that others do. Initially I had a hard time coming up with things because for the most part these are unconscious decisions. I still don't have control of my finances but it's good to know that when I want to practice restraint I can. Here's my list:

1.Salon Hair Color – I’ve been dying my own hair since I was in high school but as an adult I have often given in to the convenience of letting somebody else do it. A couple of years ago I decided it just wasn’t worth the expense. I do my own color, stick to brunette shades which are hard to mess up and I always use a coupon.
2.Bottled Water – I used to be a big offender in this category. I bought large bottles of Aquafina several days a week. Now I have a Brita pitcher at home and I keep a plastic (non-bpa) reusable bottle on my desk at work to use at the water cooler.
3.Paper Plates – I used a lot of these. I was super lazy about doing dishes so this was my solution. Now I use regular plates and I wash dishes every night before bed.
4.Soda – this is a recent one and the one I am most proud of! I used to buy at least a 12 pack every pay period as well as buying one or more individual sodas at work every day. Now I drink tea at restaurants and water everywhere else.
5.Magazines at the grocery store – I am a magazine JUNKIE. I used to be really bad, buying one or two every time I was at the store. Now I have subscriptions that I got at a discounted rate for Cooking Light and Budget Travel and I recently subscribed to All You. The rest I just don’t need.
6.Napkins – this might just be laziness rather than money saving savvy. I do buy paper towels so I use those rather than paper napkins since they can do double duty.
7.Books (not including E-books) – I’m an avid reader. I used to be able to drop $60 without blinking an eye at Barnes and Noble. I still buy books but now I get them on my Ipad. They are typically less expensive than the real thing.
8.Premium Gas – to be honest, I’ve never done this. I’ve always just bought what was cheapest.
9.Food Club Memberships – I don’t have a Costco and Sam’s club membership. I shared one with a friend once and went one time in a year. As a single person without kids it’s just not worth it for me.
10.Alcohol at restaurants – I go out to eat pretty frequently with my boyfriend or my friends and everyone always orders alcoholic beverages ….except me. That can really run your tab up. I stick to water or tea…no specialty froo froo drinks either. I prefer not to drink my calories…or my money.
11.Shaving Cream – I use lotion typically or body wash. I don’t need something else cluttering up my shower!
12.Salad dressing - I make my own vinaigrette's with vinegar, oil, mustard, and seasonings. I do sometimes buy Ranch and Italian packets to make Stephanie O’Dea’s 3 Packet Roast.

Something I noticed on other people's lists was Cable TV. I actually didn't have cable for several months and I spent a ton of money on movies, Hulu plus, and the premium Netflix account. My boyfriend and I spent football season in bars and spending money on food. For me having cable is better. What things don't you spend money on? What things do you refuse to give up?

What I'm Trying to Do

I’ve read a lot of personal finance and budgeting blogs and what I’ve found is that everyone is trying to do something a little different from everyone else. Why is that? Because we all want different things. Some want to buy house, others want to pay off debt, others are saving for their children’s college funds. What it all adds up to is financial freedom, which does in fact lead to personal freedom. So what is it that I want? What am I trying to do?

• Establish an emergency fund of at least 3 months

I realize that most financial gurus (Suze Orman for one) suggest 6 to 8 months of an emergency fund. I’m comfortable with three considering that for my entire adult life I’ve had none. This would equal about $4000. Will I save beyond that at some point? Yes….but not to the exclusion of other things….like a house.

• Buy a house

I have some qualms about this one and it may not happen but I do think that owning a home is a sound investment, I would prefer to not continue renting forever, and while I dream of moving to another state where the climate is better (I hate the heat) the reality is that in this economy I won’t be leaving my job any time soon. Also I know that I could always rent my home if I chose to leave. So for now this is on the agenda. While the above mentioned expert says not to even consider buying a home unless you have 20% saved I plan to save 5% and hopefully qualify for an FHA loan. I will also save another $5000 for closing costs and inspections. My intention is to buy a home in the $100,000 range. Therefore this will require an additional $10,000 in savings. I believe that’s something I can achieve by the end of next year.

• Lose weight

I’m sure to most this doesn’t sound like it has anything to do with finances but…I beg to differ. Being fat is expensive. I plan to detail this in another post but here are some ways being overweight impacts your budget: food costs, clothing costs, medical costs – need I say more? Don’t worry – I will later.

• Improve my credit

I have a history of being financially irresponsible. I’m not going into detail but the truth is that until I came to work at my current job I made very little money. It doesn’t excuse my behavior but it does explain it. As soon as I began making what is truly a “living wage” my bills started being paid. My credit has improved a lot in the last few years but my intention is to continue that trend with excellent payment history and a good debt to income ratio.

• Earn my bachelor’s and master’s degrees without student loans

I’m a lucky girl because my job has tuition reimbursement. I’m using that program to its fullest in order to earn my undergraduate degree in business. My hope is to graduate in December. This is being a little overly ambitious and it very well could be May. Regardless – I’m moving in that direction. Long term goal – MBA. Once again while this is not directly related to personal finance it will impact my earning potential over the long term.

So now that you know what I’m trying to do the next obvious question is – how am I going to do it?

Short term goals:

1. Save $250 per pay period for the rest of 2012 (20 pay periods X $250 = $5000 savings)

2. Lose 7-8 lbs per month (weight loss of approximately 60 lbs by the end of the year)

3. Complete my bachelor’s degree in 2012

How I’m going to do it:

1. Use a spending tracker – track all expenses, discretionary and necessary

2. Join a gym, give up soda, fast food, and eating out for the most part

3. Continue taking classes

What is it that you want to accomplish with your budget?

Baby Steps

I wrote out a list of my bills and I'm evaluating each one to see if there is a way to reduce them:

APS (electric) - average $80
Southwest Gas - average $80
State Farm Insurance - $151.00
Direct TV - $125.00
T-mobile - $76.00
Century Link - have not received first bill yet
Netflix - was $21.84 reduced to $7.99 DONE
Ancestry.com - $34.99
Arizona Republic - $4.64
Car Payment - $374.00
Rent - $561.00
*Verizon wireless - $82.07
Spotify - $10.00 - CXLD
Hulu Plus - $7.99 - CXLD
MyFico.com - $4.95 - CXLD
Experian - $17.95 - CXLD

Today I tackled my Netflix account. I'm the person who takes out books from the library and never returns them. I know - a serious character flaw. With Netflix I would get my two movies and hang on to them - for like a year. Such a complete waste of money. We do frequently use the streaming feature though. I dug out the movies I've had for..um, forever, and returned them. Then I downgraded my subscription to streaming only. That's a savings of $144 a year.

Some other easy cuts - I'm going to cancel the last 4 items on the list for a savings of $43 per month - that's a savings of $516 per year. So far today I've saved myself $660. I'd like to see if I can get it to $1000 savings per year. Stay tuned...

Taming the Beast

I've decided to get my finances under control. The title of this blog post is Taming the Beast and the beast ladies and gentleman...is me. I overspend, overindulge, and over consume in almost every aspect of my life. And quite frankly, I'm over it. In one week I turn 36 and I've decided to take the next four years and do some serious achieving. Here are my goals in general...as time goes on I will identify what's long term, short term and even micro term meaning a weekly or maybe monthly goal.

1. Drastically reduce my food bill and improve my health through diet by losing weight.
2. Save an emergency fund...not sure how many months I plan to save for yet
3. Cut unnecessary costs by evaluating monthly expenditures
4. Build a professional wardrobe without breaking the bank
5. Buy a house
6. Start a side business for additional cash flow
7. Furnish my home to make it as nice as possible but do so in a thrifty manner
8. Pay no fees - do what needs to be done to avoid late or convenience fees
9. Graduate with my bachelor's degree in business by December of 2012
10. Graduate with my MBA by 2016
11. Earn a full time salary position at work (currently in a temp salary position although I have a regular hourly position waiting for me when my assignment is over in September)
12. Take care of costly dental work

Over the next week or so I plan to solidify my goals and I will share that information here. If you're looking for someone to tell you how to save I'm not your girl...if you want to join me on this journey and learn with me....let's get started!