I’ve Paid For This Twice Already…

Frugal living and debt reduction tips for a better financial future. This is one family’s story.

Archive for the ‘33 days’ Category

Thanks for the Votes and Guest Post at NCN

Wednesday, April 9th, 2008

First off, thanks for the votes all through the personal finance March Madness competition at Free Money Finance. And great news! We won! Snowflaking: A Primer was crowned the best personal finance post of the last year. $500 will be donated by Free Money Finance to The Make A Wish Foundation to celebrate. Congratulations to all the other entries as well and especially the rest of the final four, whose charities will also receive donations:

I don’t labor under the illusion that my Snowflaking post won because I am some supreme writing goddess – it is because of all of you out there who have embraced snowflaking, talked about it on your own blogs, joined the Snowflake Revolution, and otherwise become huge advocates for snowflaking in your own life. It is amazing how one simple idea can spread like wildfire and become an entire phenomenon. Thank you to everyone who has taken snowflaking under their own wing, and let’s make this year the year we finally start moving meaningfully towards debt freedom, investing and savings goals, and a better financial future. Financial independence, here we come!

On that note, No Credit Needed has been running a semi-regular series called 33 Ways and 33 Days to Increase Savings and Reduce Debt, and I had the honor and privilege of writing the final installment, Day 33, for his blog. Day 33 – Remember To Live A Little, went live yesterday. I was really excited to see it, because I thought that meant his wife gave birth to their third child, but they are still waiting for baby to be born, NCN is just super-busy with preparing for her arrival. If you aren’t a regular reader of No Credit Needed hop on over and read my take on what it all means.

My usual Wednesday carnival roundup will appear later this week because I wanted to share all the exciting news above with you – I have some exciting news on the carnival front too though, as of this writing, I have had 4 editor’s picks in carnivals this week. World domination here I come… ;)

We’re Interest Order – How About You?

Friday, January 25th, 2008

There’s a never-ending debate in the personal finance world about what order to pay off your debt when you have numerous debts at varying balances and interest rates. In an ideal world, your head, your heart, and your gut would agree, and the order in which you attack your debts would be obvious. But this is often not an ideal world, and sometimes your head says one thing, your heart says another, and your gut might even pipe up with a third opinion. On Day 32 of 33 Ways and 33 days to Reduce Debt and Increase Savings, NCN at No Credit Needed says to decide which debt to attack first, and outlines the three common choices. You can attack highest interest to lowest (mathematically most desirable, a clear head candidate), lowest balance to highest (often the heart’s choice), or simply start with the debt that bothers you the most (your gut speaks). So what do you choose?

For us and our situation, the decision was pretty straightforward. Our debt with the highest interest was also the debt that bothered us the most. And all four of our debts started off with pretty high balances, so starting with the lowest balance debt would still take several months to pay off and wouldn’t provide any immediate psychological or emotional satisfaction. So we chose to attack our credit card debt, which was our highest interest debt, with the greatest vengeance, and focused the extra in our debt snowball as well as all of our snowflaking efforts upon it. We’ve been temporarily sidetracked by an unfortunate engine replacement in our car which necessitated a complete emergency fund overhaul, but as soon as we’ve restored that and eliminated the remainder of the $3600 car repair (down to $800), the last of that credit card debt (which started at over $6000 but is now $155.17 and counting) will be history. I’m also a math geek so attacking the highest interest rate is emotionally satisfying for me.

However, I am not a die-hard math-is-everything believer. As long as what you choose is working for you and getting you out of debt, and another method that might make more straight mathematical sense just won’t work for you – do what you need to do. Getting out of debt is the key. That’s why we’re doing this and that’s what we’re fighting for. We don’t all travel the same road and we don’t all get there at the same time. The journey is sometimes as important as the destination.

So if you’re working through the process of eliminating debt – what method did you choose? Leave a comment sharing your successes and struggles and become part of the journey.

Avoid Target at All Costs

Thursday, December 13th, 2007

In Day 31 of No Credit Needed’s 33 Days and 33 Ways to Reduce Debt and Increase Savings, NCN says to avoid the mall. And I wholeheartedly agree. Except that for me, it isn’t the mall. My problem is Target.

I love Target. I love the bright lights, the wide aisles, I even love the red and white bullseye logo. When we bought our current house a little less than a year ago, one of the things I mentioned to everyone who asked me about the house was “It is only minutes away from Target!” And it is. I had visions of going to Target once a week or so and scouring their aisles for clearance deals and considered myself a savvy shopper.

But the problem is, I would buy things I didn’t need and wouldn’t buy otherwise just because they were on clearance. Yes, that $3 pair of pants for my son was a great bargain – but only if he needed a pair of pants. Being inexpensive is no justification for buying volume that is not necessary. In fact, if I buy 5 pairs of pants at $3 each when I only needed one pair of pants that was originally $10, I would have been better off paying full price for the one pair of pants.

I have rectified this in a few ways. First, I just don’t generally go to Target anymore. I found once I stopped going just to browse, I realized that I honestly didn’t really need to go there all that often. Next, if I do go there, I go in knowing exactly what I need, and I don’t look around. I go in, I get the item, I buy it, I leave. I found doing this when I have an appointment scheduled soon after so I am in a time crunch worked really well. And my last idea hasn’t been tested yet, but I am hoping it works. Sometimes I do truly need to shop the clearance racks for clothes for my kids. But in the past, I generally browsed and bought whatever I liked as long as it was a good deal. This year, I am going armed with a list of specific items and sizes, for example, sweaters, no more than 3, size 4/5, and I am going to shop specifically from the list. I had sworn I would not go to Target at all this season, but when I was taking my son’s winter clothes out of storage this year, I found a bunch of sweaters and shirts and pants I bought for him last year on clearance that I really did need for this year. I just generally buy too much (and last year was no exception, no child needs 13 pairs of pants). So this year when everything winter goes on clearance, I will have a specific list limiting me to only what I need of each item. Hopefully it works.

Taming My Cash Spending Trigger

Tuesday, December 11th, 2007

In Day 30 of 33 Days and 33 Ways to Reduce Debt and Increase Savings over at No Credit Needed, NCN says to know your weakness – identify your spending triggers so you can overcome or avoid them. Later this week I’m going to talk about my spending trigger *places* and how I deal with them (actually in response to Day 31 of the same series). But I have a huge spending trigger that isn’t tied to a specific place or external situation – cash.

Carrying cash for me is almost a license to spend.  I am a fritterer by nature and I find it very easy to justify in my mind spending small amounts of cash for things I would never get if I didn’t have cash available.  For some reason, when I all I have is my debit card, it inhibits me from spending small amounts.  But when I have cash, it is like a whole new world opens up to me.  I look at coffee drive-throughs, fast food drive-throughs, little trinkets at the checkout line, all sorts of things that with solely my debit card, I do not generally consider.  And the worst for me is the “leftover” cash.  If I take out $60 to purchase a specific thing that I need to pay cash for, and it ends up only costing $55, that other $5 somehow disappears for me within the next few days.  Maybe a latte, maybe some candy, maybe something else.  Who knows.  But it is gone.

I combat this impulse in my brain in two ways, and one of them I never would have guessed works but for me, completely does.  The first is the obvious – don’t carry cash.  And generally, I do not.  I have done this for a long long time, for I know myself and how I love to fritter away cash.  But sometimes, I need cash for a specific reason, or someone gives me cash for something.  And when I can’t avoid having cash, what has helped me not fritter it away?  Having a budget.

I realized that why cash was so easy for me to spend in the past is because it was kind of like unaccounted for money.  Once it was withdrawn from our checking account, or if it was given to me and therefore was never in our checking account, in my brain it was already spent.  So spending it had much less pain attached to it for me than a debit card transaction.  But now, where every dollar is accounted for, even cash isn’t spent in my brain until it is actually physically spent.  There is no fuzzy gray area where the cash is still in my pocket but my brain has let go of it so it can freely be frittered whereever.  And that was an important realization for me.

It is all about the attitude.  If the money is already gone in my brain, it is as good as gone.  But if that money is part of an overall budget and I know where it should be going, if it doesn’t get there, my brain is upset.  And that has made all the difference.

How much time do you spend on your finances?

Saturday, October 20th, 2007

On Day 9 of NCN’s 33 Days and 33 Ways to Reduce Debt and Increase Savings series, the question revolves around time management and money. How much time do you spend on your finances? Better yet, how much *effective* time do you spend?

How much time do I spend? Too much. But part of that is by choice. I like doing money management tasks immediately, and I enjoy indulging in my micromanager tendencies with recordkeeping. It isn’t the most effective use of time, for many similar tasks could be saved up and batched together and done in a single processing time, but I like being up to date all the time. In fact, as you read this, I know I am in a car coming back from our trip thinking “I need to get on the computer and enter all this data!”.

Does better organization lead to less time spent on finances? I am sure it does. I am pretty organized, but I could be better. I don’t think I’ve found the right system yet that incorporates my need for immediate feedback with a streamlined time-management approach.

As I said, I am a micromanager. I think it is probably more productive to just own that fact instead of continually fight it. That doesn’t mean I accept my micromanaging tendencies at face value, but I do often simply give into them. Worse than just a micromanager, I am a micromanager with an incredibly short attention span. How to get over the “micromanaging” impulses? Is it even possible? Or is it easier to just give in?

Are you a micromanager at heart and have found a system that works for you? Let me know! I think it’d be easier to find the right system than to change my inherent nature.

__________________________________________________________________________________________