The Financial Cake

One of my favorite quotes is “if you want to make a new cake, you have to change the ingredients.” My financial cake has not been tasting good lately, so it’s time to switch things up.

I always thought I was being super responsible financially and hated the advice of how to save a bit each month because I don’t buy coffee every morning, I don’t have cable and I so rarely go out to eat, but this month I found out there is squish room in EVERY budget, you just have to consider what’s important to you and make cuts.

My new mortgage + my HOA saves me $80 a month from what I had been paying (paying less per month was a requirement when I was home shopping and thanks to the market, I got a place I love for less!) and updating my car insurance to my new address resulted in $10 savings on that! I downgraded my Blockbuster online account since I hadn’t been finding time to watch many movies anyway, saving $10 each month as well. Finally, my health insurance monthly payment went up, so I changed plans and my new one saves about another $10 from the original plan I had. That’s $110 a month! 

I’ve also recently conceded that an eight-month emergency fund is A. a little excessive (probably great advice for different situations, like a one-income family, just to be safe) and B. the bane of my existence. I have five months and it’s a nice, round, plushy number.  Call me happy. 

I actually had almost six months so I’m going to take the extra and pay off my credit card that crept up over the summer (“saving” the payment I was making on it, anywhere from the $15 minimum to $100/month) and overpay on my smaller student loan next month (not saving money yet, but shortening the payment period to help future MJ save).

I think a big drive for these changes was that I was tired of the monotony of spending bare bones money on the same things every month and feeling like I constantly had to save every single penny.  I’m single and in my 20s and should be having a little more fun! 

So there you have it, I’m saving some money, spending more money elsewhere…just a reshuffling really, but I think I’m going to be happy with this new cake for at least a while now that I’ve learned to be flexible with my spending and my attitudes about money.

When Tact is Not an Option

I’m getting better at standing in my financial truth and saying no when I don’t have money to spend or that I want to spend.  But what do you do when it’s your family?  And what it, even though your future brother-in-law just ended a stint of unemployment, you’re still the poor one? 

Sometimes I just want a man, not to be an emotional support, an activity partner and to give it to me on the reg, but simply to share the damn bills. 

We’re celebrating Father’s Day early (today) so my sis can celebrate the actual day with hubby’s family and after I suggested something active, three somethings active to be exact, she decided we’re indoor kart racing.  Apparently there are “head socks” involved and I have to wear closed toed shoes?  WTF?  It’s 100 degrees outside woman!

I get that my dad’s a boy and for one or two days a year, we do boy things to make him feel better about having been trapped in an otherwise all-female house for 20 years of his life, but this is not my thing.  It’s especially not my thing for $56 for essentially 30 minutes of play. 

But, that’s the activity and I don’t feel comfortable telling them that I would rather choose not to afford it.  But I guess that’s what you do for family. 

I even sucked it up and threw my hat in the ring to help plan my sister’s pre-wedding events, which will likely not be cheap either.  When she initially spilled that I wasn’t the maid of honor, I kind of took a giant leap back and, like a kid picked last for kickball, pretended I didn’t really want to play anyway.  New plans included NOT planning showers and parties and YES getting drunk at the wedding because I didn’t have to worry about giving a speech.

Her reason for not asking me to be her MOH was that she didn’t think her BFF and actual MOH would do anything, which A. makes no sense and B. is totally what’s happening. 

After a dress shopping trip a few months ago, the MOH said she wanted to talk about details for the shower because she had been planning it.  We all leaned in, ready to get down to it.  “I think we should have it at a winery.”  That was it.  Way to plan, MOH, way to plan.

For a while I thought I could sit back and be okay with that.  It’s not my job after all.  My sister even kind of brushed off the idea of a bachelorette party based on the pregnancy of the other bridesmaid, but who doesn’t want at least some occasion to celebrate? 

Even though I’m realizing I’m more hurt by her behavior in the past few years than I previously thought, I couldn’t let the wedding come and go without giving her the proper pomp and circumstance around the whole thing.  She’s my sister. 

So I jumped in and asked about plans and based on the fact that three days have passed without a peep in this constantly connected world, I feel like I might be taking it over.  But, I guess that’s what you do for family. 

And now that I’m in charge, I’m going to call it a hen night or maybe a stagette, because both are waaaay cuter.

UPDATE:  My wonderful mother paid for kart racing and I crashed under a wall three laps in.  Then I helped pay for dinner.

Trying For Tact

Can we all agree that it’s tacky to talk about money?  Well, except on a blog where, thank the Lord, we can say anything we want!  But, you know, in like, real life, I try to avoid it.  I am actually getting better at saying no to things that are unnecessary drains on my bank account without actually giving that as the reason. 
 
I partially do that by keeping myself busy with free events.  I mean, I guess I could lie about having something else going on, but it’s just as good to actually have something else going on, then I’m not lying (I’m not that great of a liar), not bored and less likely to give in out of boredom.
 
Just this month, I’m taking free yoga classes, celebrating the birthday of a trendy ice cream shop with free ice cream, going to see a movie with free passes, going to a free bikes for dummies clinic, volunteering, donating blood and participating in a free running event at a local running store. I kinda have a knack for finding free shit and get a kick out of it.  I don’t want financial responsibility to keep me locked inside my apartment. 
 
However, when someone invites me to something a few months away and then makes the date flexible to my schedule, it’s a little harder to be tactful in my response. 
 
MOH to bridesmaids:  “Hey, can we move the bridal shower to this Sunday in September instead of the Saturday we had talked about before?” 
 
My first response:  “I most likely won’t make it unfortunately.” 
 
MOH: “Oh, no! If we kept it on Saturday would you be able to make it?”
 
My second response:  “What I meant is, I most likely can’t make it either way.  Don’t plan around me, just do what works for everyone else and I’ll make it if I can!” 
 
MOH:  “Is there a weekend you can make it?” 
 
My third response (I may or may not have actually said some – or all – of this):  “Listen lady, I’m not going to clean out my bank account for a shower.  It’s not a drive across town for me.  Maybe if I get a second job or a raise between now and then and can’t find anything better to spend my money on, like, food or bills or things that I want to do, I’ll fly out to have a tea party with old ladies.  Do you understand what I’m saying now?” 
 
And she did.
 
I was kind of proud of myself for not including “if I find a sugar daddy” in the list of ways I’d be able to go to the shower. 
 
My freebie-seeking college kid lifestyle may not be the most luxurious life, but it’s the life I can afford on my own right now. 

Slim Pickings

It’s that time of the month.  No, not THAT time.  THAT time has come and gone and I’m eagerly awaiting the arrival of my next round of cramps from hell and Too Sad Tuesday.  Another time.

THIS time of the month is the time when I’ve just about drained my checking account.  Payday is tomorrow so at the stroke of midnight, my account will get a magical bump and all will be well with the world again.

As I mentioned in a SFC post, I transfer money to my savings account shortly after getting it in my checking to ensure I actually save something for the month, but then I do the worry game and constantly check my account. 

Is there a scheduled payment I’ve forgotten about?  Just how much ARE gas stations holding on your card these days before they let you pump?  I think I’ll make it.

BUT, just because I’m getting paid, doesn’t change the fact that there’s still two days left in April, so spending is staying down.  The end of the month is always when I have to really have to focus on NOT spending and the focusing really makes me WANT to spend!

Case in point, I spent the last two days after work wandering shopping centers.  When it got to be 6:00, I thought to myself, who AM I?  I’m a homebody, go home!  I did end up with a pretty dress from Nordstrom Rack (still using my tax refund to supplement my wardrobe) and couldn’t resist an OPI polish.  I do not buy OPI normally, but the color was awesome (Red My Fortune) and it went on so smoothly, I might be a convert.

Anyway, if an $8.50 bottle of polish is my splurge, I think I’m okay.   

I have $74.76 left in my budget (really only for gas and two nights out) and $134.08 in my account, so balls to the wall!

I did okay with my budget this month and I also had a realization.  When I assessed my spending, I was paying $191 on the second of every month for my car payment.  My idea of how much I spent per month included that, but when I finished with those payments last October, my idea of how much I spent per month, and therefore, what I gave myself permission to budget every month, remained the same. 

Add to that the fact that I recently started participating in my company’s 401k program (just as soon as they announced they had reinstated their match) and my paychecks ain’t what they used to be, so I realized it’s time to pull back.

Now add to THAT the fact that I feel like I have a well-paying job.  I feel like I’ve paid my dues with crappy jobs, with having to work two jobs.  I’m a professional in my mid-20s and my opinion is that as you become more successful (and get older), you get more flex room with your spending, not the opposite. 

Needless to say, when I presented this idea of pulling back to myself, it was met with a bit of resistance.  What’s right isn’t always easy and what’s easy isn’t always right.

Insert big girl panties. 

I sucked it up and skimmed a bit off of each category in my budget that had flex room and have now ended up with a budget plan for May that is $150 lower than my previous idea of how much it should be, making myself save most of that car payment I would have previously been making, but giving myself a little reward for being done with it. 

This budget thing really is a month-by-month learning process.

March Budget Update

Better late than never, I wanted to write about a few money lessons from my March budget.  (I now realize it’s only the 7th, but my brain is like weeks ahead because of all the plans I have and I’ve convinced myself that it’s practically May.)

I already mentioned how March was all about begrudgingly digging into my e-fund.  Yesterday was my last trip to the dentist for his overhaul and the cheapest (I think because I reached my deductible, yikes).  Man, I’m going to miss him.  Or not.

Still, at the end of the month, I was able to put a little savings back into my e-fund, my planned $50 into the wedding fund and even a little something-something into my wanderlust fund!

That’s because when it came to my actual budget, I kind of rocked it.  With $38 left on the 31st, I paid my entry into my last 10K of the season (and really, only my second 10k ever) and ended the month $10 under budget!

With every month I’ve had a budget (since December now), I’ve learned something new and gotten better at it.  In March, I learned that budgets are all about mindful and planned spending. 

Having no-spend days (goal was ten, had nine, not bad) means going to the grocery store on a day I know I have an automatic bill coming out of my account.  It also helps my sanity.  I actually don’t like shopping all that much, so if I hold off on going to Target or Sports Chalet until another day, I’m more than okay with that.

Planning my budget for the month ahead means considering all expenses (as many as I can, things pop up of course).  Like, for April, I put extra money in my car fund because I need to get my oil changed and extra money in my phone category because I’m upgrading this month. 

In March, I also got more realistic about my “going out” category.  I avoid eating out and didn’t have many opportunities for it before (because guys always pay on a first date and most of the men I date don’t make it past the first date and my social life has been lacking) but now I’m going out more, so I’m giving myself more room in that category.  And when I do go out, I’m setting nightly spend-limits, if I go to happy hour or something, I’ll tell myself that I’m only going to spend x amount to stretch that going out budget.

My April budget looks good and includes some fun and some savings, which is exactly the balance I wanted when I started making and following budgets.

E-Fund S.O.S.

I have been doing pretty well on my emergency fund recently.  It’s not fully funded, but it’s comfortable.  March has certainly been a test of that. 

A check up at the dentist in February turned into a three-phase follow up and my insurance covers some, but definitely not all. 

A safety recall on my car turned into a complete overhaul.  Okay, not complete, but the list of things they found wrong was immense!  It was all stuff I knew needed to be fixed and had it on my list but never got around to (my future husband and my father both just rolled their eyes).  It was convenient to just take care of it all at once while I got to drive a fun, little Jetta around for the day, but taking on the cost all at once was not fun.  At all.

A few years ago, even though I had the money, I would have put it on credit cards so I didn’t have to think about it all coming out of my account at once.  But now, instead of freaking out about these expenses, I reminded myself that this is what the emergency fund is for, transferred the money into my checking account and paid it like a big girl.

Okay, maybe I freaked out a little.  I thought about how I could pull back on my spending to pump up what I’m contributing to get the e-fund back on track, thoughts of a second job flooded my brain.

But, I took a calming breath, reminded myself, again, that’s what it’s there for, so that I don’t have to disrupt my monthly budget.  I honestly don’t remember the last time I dipped into it, so even though I had two “emergencies” this month, it doesn’t mean I’ll keep having them.

I also had a bit of a freak out when my second bride and the few bridesmaids she had in tow picked a dress that costs more than any dress, let alone a bridesmaid’s dress you’ll wear once, should and more than I had budgeted for.  However, I smiled, said, “whatever the bride wants,” and forked over the first half for the down-payment while reminding myself that that’s what the wedding fund is for and the $30 that it went over what I budgeted just means I’ll sit out a round or two at the bachelorette party.

Without these focused funds, I’d probably still have the same amount in savings, but putting it aside and labeling its purpose really helps me a lot.  And that’s what they’re there for!

I’m a Big Kid Now

Last summer when I made my 101 list, I felt silly putting “pay for my own cell phone” on the list. For goodness sake, I was 25 and saying that SOMETIME before I turned 28 I wanted to pay for my cell phone myself? Spoiled. Brat.

It’s just something my mom has always done because we were on the same plan and contract lengths and unemployment and underpaying jobs and blah blah blah. I’ve told her many times I was going to do it, but never got around to it.

Today, I finally made myself an account owner to basically separate our phone bills and got my own login info and…drumroll please…paid my own cell phone bill like a big girl.

It’s silly to be so excited, but it was like when I made my last car payment and was jumping around saying, “somebody hug me!”

Except today is the opposite. A first payment and, seeing as how I could never imagine going without a cell phone,  these will never end. As much as I hate spending money, I love that I’m spending money on this.

I’m also going to redo my budget tonight to include this new monthly expense and allow myself more flex room. It’s pretty much bare bones right now and it’s based off the fact that I spent about $2000 a month when that’s about what I was making, so now even though I’m making more, I should still spend that amount.

Change of plans.

I’ve earned the freedom to spend more. I have a good job and make more money now. I paid off my car and credit card.  I overpay on my student loans while still building my savings. Everything left is MINE.

I don’t want to spend money for the sake of spending it, but I want to be okay with going out for happy hours and buying some cute new date clothes.  Going from super-saver mode to okay-to-spend mode is difficult, but having a budget to tell me it’s okay without letting me go overboard is a good way to start.

Paying Down (My Sanity)

Last week I wrote about how instead of driving myself crazy by only saving for my “shoulds,” I’m contributing to a fun savings fund for my wants as well.  I thought of that fun wanderlust fund when I saw this Sunday’s PostSecret, which including this exciting card:

(The front says,”I’ve booked and paid for a vacation 8 months from now that I won’t be able to take unless I quit my job.”)

I love it.

Moving on, today, I wanted to mention something else I do with my money simply for the psychological benefits. 

Once a month, I withdraw everything from my bank, in small bills so it looks like more and I do the whole throw it in the air, roll around in it thing.

Just kidding.  That would be weird, right?  Thought so.  Yeah, I definitely don’t do that.

What I meant to say is that I know it makes sense to pay off higher interest debt first.

HOWEVER…

My only debt currently is student loans.  Ugh.  I have two loans I’m repaying, both with relatively low interest rates, but the one with the higher interest rate is a larger balance, so for the sake of my sanity, I’m focusing my extra payments on the smaller loan with the smaller interest rate.

Even as I type it out, I realize it doesn’t make sense. 

There is much debate in the personal finance world over paying off smaller balances first v. paying off higher interest first (and which is truly the “snowball method”).  You’re more likely to stick with a plan when you see the progress, but in the long run, you’ll pay more if you go with the small balance theory.

For me, the psychological benefits outweigh the minimal difference in interest I’m paying on the larger debt.  I really want to cross that sucker off and, because I’m overpaying, I will be able to by the end of this year. 

Should I find myself with credit card debt again, I would definitely focus on getting that paid off because credit card companies are the devil and I refuse to give them any more of my money than necessary, but for now, my plan to pay down my sanity works for me.

Saving (My Sanity)

My budget spreadsheet got a makeover this year.  Specifically, it’s actually acting as a budget, whereas up until last December it was basically just where I tracked what I spent and prayed that my end-of-the-month number was smaller than my income.

Now I’m creating a monthly budget and am still trying to figure out the whole following it thing.  Baby steps, right?

Basically, I simplified my budget spreadsheet, but the thing I’m most excited about is the addition I made.  Hello goals tab.  

I’ve always been good at saving money, in fact, my sister used to tease me for it, but there was never real organization to it until now.

Now, in lovely 2011, I’m tracking my savings goals – bridesmaid fund, e-fund and retirement contributions – and my goals for paying off my student loans ahead of schedule.  I made a column for my planned and actual contribution to each fund and I set up the equations to show me what percentage of my goals I’ve reached.  It makes it a lot easier to follow my budget because all the money I save goes to one of the funds.  And now I know which one. 

And when I pay for wedding-related things, I’ll know I’m spending the wedding money.  And instead of pretending all of my money in my bank accounts in my e-fund, I will see when I actually meet my eight-month goal and be able to pad the fun part of my budget. 

The uber-organization of the color-coded charts made my heart flutter a bit.  Until I realized those funds suck.

Yes, I’m excited about being in two weddings and the time I get to spend with family and good friends during all the related festivities, the idea of fully-funded emergency and retirement accounts keeps me sleeping as snug as a bug in a rug and I’m planning a 24-hour happy dance-a-thon for when I finally pay off my student loans. 

BUT…a girl’s gotta live, am I right?

So, I added one last goal.  A wanderlust fund.  It gets the least amount of attention money, but the point is that it gets some.  All work and no play makes MJ a sad girl.  I love knowing that I’m putting aside money specifically to get on a plane and stay in a hotel and experience something totally new and wonderful.  Even if I’m only at 1% of my total goal at this point.  Again, baby steps.

Who needs a tiara? Give me a Roth IRA.

Finding this clip was supposed to make me feel better, but I remembered it differently.  I thought she straight out googled “finance,” but she didn’t, so it didn’t.

I work in finance and sometimes I wonder how the hell that happened. Scratch that.  I work in the finance industry and I was hired because knowledge of the industry was not a key requirement.  My bosses actually find it slightly humorous, and I like to think charming, that the TV by my desk – meant to keep guests in the office informed about the markets – is more often tuned to The Today Show and Oprah.

It’s mostly frustrating to me personally tonight because of the “rollover 401(k) to Roth IRA” cloud that has been looming over my head for years!  I’ve got step one crossed off my list, but don’t know where to go from here. 

21-year-old Emjaye never really expected to be here, but 26-year-old Emjaye is glad she is. 

At 21, I talked vaguely with my dad about finance as I started my first real job, opened those damn 401(k)s and began supporting myself.  At 21, there was a big hullabaloo about transferring investment accounts into my name, but I haven’t done much with them (besides, fortunately, watch them grow). 

At 21, I thought by 26 I’d have found someone to know about finances in the way I’ve always relied on my dad to know about finances.  When I say finances, though, I mean the bigger stuff.  Day-to-day, I feel confident about budgeting and spending and saving. 

Luckily, I never got myself into huge debt expecting some prince to come along and get me out of it.  I just expected some prince to come along and help me plan a comfortable life and retirement (like my prince of a dad has with my mom).

At 26, I know it’s up to me.  And just like at work, I’ll get there.  Neither is going to be about step one, now step two anymore.  I work better when I know WHY I’m doing step one and HOW it helps me at step two, so I’m engaging myself.

I might have a little talk with Pops this weekend, but those talks usually just remind me that I’m quite capable and knowledgeable if I just give myself a break.  And that I don’t need a prince and his castle and his piles of money.  I just need a man who will treat me like a princess – maybe even one who is a little turned on by my financial savvy!