Yellow's Green

Full-Time Mothering

2007-05-04T08:10:00.000-07:00

According to this article, my work is worth $138,095 a year.
Now if I could only use that to pay for J's college. (ha!)

Oh, and you get what you pay for

2007-01-30T11:17:00.000-08:00

I did get to talk to someone on the free finance day... but I didn't get too much help. I think my questions were to specific and their advice was too general.

The call ended with, "Well, I have other people to answer questions for, so, thanks for calling!" and I just let it go.

Had I been paying for service, I would not have let that happen. But, had I been paying for service, I doubt I would have been brushed past so quickly either.

It was worth giving a call, though, 'cause you never know.

We're Getting Closer!

2007-01-30T11:10:00.000-08:00

But we're not there yet.

This weekend, there was an open house for a nearby home that has been on the market for a long while now. We stopped by on a whim and got very excited. It was a fantastic house with lots of options for doing the kinds of things we'd like to do. We started dreaming and getting excited the way we do.

So yesterday, we met with a relative who is a mortgage banker, to find out what we could do. By this time, our excitement had tempered into the realization that this particular house was likely beyond our means, but we'd like to figure out exactly what is within our means.

We are much more encouraged than our last round of house-dreaming. We are not there yet... we'll have to get to the earning point where we could have about $1500/month to pay mortgage costs. Now we have a much better idea of what our savings/earnings goals are.

This is good.

"Free Retirement Checkup"

2007-01-26T10:28:00.000-08:00

I attempting to call 888-919-2345 to get free financial advice from the National Association of Personal Financial Advisors (NAPFA) as I type. I have the phone on speaker, sitting next to me, as it goes through the wait-and-hold recording. I've tried to get through twice today, and so far, no luck.

I know about the day of free advice from reading Kiplinger's Personal Finance magazine, the one I won a subscription to.

I do have a list of questions that I would like to ask an expert about. As our brokers have broken our trust (what we discussed doing with them and what they actually did were not the same) we don't really want to ask them these questions, especially since they involve "how do we move our IRAs our of their control and into our own control?"

So, I hope I get through today.

2006 Spendings

2007-01-23T20:01:00.000-08:00

Here's a look at more spending totals for 2006:

Birth & New Baby Stuff: (as stated in the last post)
->$841

Travel: (3 roadtrips, 2 flight trips)
->$1937

Out of Pocket Medical: (my Meds, and several co-pays for well baby and sick baby visits)
->$442

Education: (which should eventually get refunded through Erik's job)
->$486

Toward Student Loan: (I have to figure out why the interest I paid and the statement they gave me have such wildly different amounts for what I payed in interest and can claim on taxes)
->$2626

All things Car Related: (Gas, repairs, insuance, etc.)
-> $1365

"Fun & Flexible" Spendings:
Gifts/Donations (from Erik, Me, and Both of us...)
->$1032

Clothes (Me, refreshing my entire wardrobe with going-out-of business deals)
->$218

Books (Almost entirely computer programming books)
->$192

Games
->$106

Electronics
->$203

Tools
->$209

I'm ok with these numbers. We did well last year.

Hopefully I'll remember to post a savings report soon. For now, I need to go care for the fussy baby.

2007-01-23T19:35:00.000-08:00

I've neglected blogland for over a month now, but it is not for lack of financial adventure. Nothing big, but I've been busy working on other internet projects.

Just to post something related to the post a month ago...

I've always been called lucky. Many members of my family quit playing games with me for this reason. I'm not a sore loser, and I am a gracious winner, I play fair... I just have good luck. I once won a game of Monopoly while spending the first half of the game in jail. I only owned one Monopoly - I had to deal for it, giving free parking to the giver - and everyone landed on the highest paying spot to me (I think it was St. James) EVERY time around the board. It was crazy. I also roll sixes too frequently in Risk. I love it!

Anyway, by chance I won yet another drawing from another blog (Parent Hacks) I like to read (another maintained by a Portlander too). This time, it was a random drawing, and it was for submitting a comment on what you think no parent should waste their money on. I commented that I couldn't really say, as I couldn't think of anything we've purchased that's been a waste of money. We used the "wait 'till you need it to buy it" philosophy, and it's done us proud. In fact, we spent a grand total of $841.25 on Jasper related expenses in 2006. That INCLUDES a birthing class, furniture, and the birth itself. (Thank heavens we won that insurance battle!)

We won a baby monitor - something we haven't purchased, but it would be nice to have while I leave the baby downstairs napping while I go up to the kitchen for lunch. And it's a nice monitor, too. Sells for around $200... that's almost 1/4 of what we spent all last year. Niiiiice.

Christmas Prize

2006-12-12T07:09:00.000-08:00

"It's a grand prize... 'frah-gee-lay' it must be Italian!"

It wasn't a "grand" prize, and it's not a leg lamp, but I did win something.
J.D. at Get Rich Slowly posted a fine article all about saving money for the holidays. He asked readers to submit their best holiday money saving ideas.

I commented on how our family is writing a chapter of our history. We'll pick different topics, and each of us will submit a little something on it. This year, we're all writing about how we met our spouse.

I love when we do this, especially a year (or years) later when I look at writings I'd forgotten about. One year, we exchanged our favorite recipes and wrote a food-related memory. In re-reading those, I'm getting hungry for my sister-in-laws cooking. She had so many good-looking recipes!

J.D. and his wife liked my idea, and awarded me with a one year subscription to Kiplinger's Personal Finance Magazine. Hurray!

Know the difference between Dollars and Cents

2006-12-09T12:55:00.000-08:00

Not everyone does. Seriously. In fact, read this out loud:

$0.002

Did you say "point zero zero two dollars" or "point zero zero two cent"?

Now listen up:

http://verizonmath.blogspot.com/

100x makes a big difference.

Read Sale Advertisements

2006-11-18T11:10:00.000-08:00

My MIL is frugal shopper extraordinaire. She scours the advertisements to keep her eyes out for coupons and special deals. Thanks to her, we now have a pantry full of cake mix. And it cost a whoppin: $0!

One ad showed Safeway was having a baking sale, where if you bought ten of a particular list of items, you'd get $10 off. Elsewhere, she saw that cake mix - which was one of the special items - was on sale 10 for $10.

So, we multi-tasked and went on our morning walk IN Safeway, and helped them give away their cake mix. "It would be irresponsible to just leave them there," MIL said. Certainly!

Even Lower!

2006-11-14T10:13:00.000-08:00

I received a letter in the mail this week informing me that since I've made 36 consecutive on-time loan payments, they're lowering my interest rate by 1%. Hurray!

When I looked closer, though, they had only applied it to one of the two loans in consolidation, and the smaller one at that. So, I picked up the phone and I asked them why.

The customer service girl was very friendly, couldn't find a reason why, and is sending a claim to the interest rate billing department to have the discount applied to the full loan.

As if a 2.625% rate wasn't low enough. Try 1.625% on for size!
Nothing but minimum payments will be coming from us - we can always earn more interest in savings than we'll have to pay toward this loan. (It will still be almost 10 years before it's paid off, though.)

The Cost of Productive Time

2006-11-07T14:48:00.000-08:00

Regarding my last post on the cost of making vs. buying a quilt somebody said: "Yeah, but how much time did you spend on making the quilt from scratch? Don't you have to account for the monetary value of your time when you do such calculations? I am not questioning your passion for quilting, but I am just skeptical about the math here."

You're absolutely right. However, when my time would have otherwise been spent sick in bed doing not much at all, I feel this *productive* time should not being given a negative calculation. If I had a job that paid money (vs. one that pays in sweet cuddles) and chosen to spend my time quilting instead of working, then a negative calculation for time spent would be appropriate.

Some people value time purely based on quantity. I prefer to value time qualitatively. If my time is spent productively, and enjoyably, then it's not worth my time to apply a "cost" to it. When we work to achieve money, money is not really the goal, is it? No! The goal is to earn enough money to cover the basics, and be allowed to enjoy. Not because we want to feel rich with money stocked away,but because money stocked away now should become a means to an end: enjoyment. It's why we save, why we invest, and why we refuse to work 20 hrs. a day for $1 an hour.

Also, if I applied a "spent" monetary value to the things I had to do, but don't get paid for, I would get depressed in my current career choice as a full-time mother. I get no money for what I do - and I don't love every bit of it. It's not worth it to dwell on money matters here. My choice to stay home is an investment in my child's future, and a safety net in case my husband finds himself in a situation where he can't work.

However, there are instances where time has a cost I would apply money factors to. A great example is the commute to work. Driving an hour to your job subtracts two hours from your day in a way that for most people is unproductive. (Some people manage to make their commute productive. Erik, for example, rides the Max and reads/studies during his. It's his enjoyable personal time.) The cost of a commute, both in time and gas, should be factored when figuring your actual salary, and included factors when making a career choice.

Other activities where time has a cost:
Standing in line
Waiting on hold during a phone call
Sitting through a boring lecture where you are learning nothing
Being bored at all
Excessive television/movie watching or video game playing. (I don't discount a need for some mindless relaxation.)

You get the idea.

In fact, this is the first full size quilt I've made, therefore it was an educational experience. Education is an investment. So, if I wanted to get really technical about it, I could say I saved even more than I did if I factored in investment value.

Home Making

2006-11-03T17:12:00.000-08:00

vs

When I was little, we used to make our own clothes. Really. My older sister made her own clothes all the way through high school. (Check out what she does now!) I made mine through about fifth grade - where I made these ugly tropical-print hammer pants. Wow! I do still love the prom dress I made in high school, though. (Wish I could still fit into it! Or have a reason to wear it.)

These days, it's not usually cost effective to make your own things. You can find new things for very little money, less than you will pay for the low quality fabrics at Joann's. But, I still love sewing, and it feels so good to have something personalized.

I'd been eyeing this quilt, and in a fit of creativity, decided to make my own. All the fabric, thread, etc. cost me about $68. By the time the quilt was done, I had definitely spent more than I would have ordering the catalog variety. But, I realized if I added in the cost of the extras (pillow covers and such) I would come up with a savings in the end. So, I used up every piece of fabric I purchased, making a full sized quilt, a decorative pillow, two pillow cases, and three cubes pillow throws.

From the catalog:
$40 for the quilt.
$20 for the pillow.
Shams, $20 each.
Cube pillows? Unavailable.
Shipping $16.
Total: $116

I spent $68

Total savings: $48

Traps in the Toys

2006-10-05T11:39:00.000-07:00

I love new gadgets, but not nearly as much as Erik does. He'll spend hours online (when he can find the time) reading everything he can find about any cool new gadget that piques his interest.

As I mentioned, we recently changed our phone service plan, but not before we took advantage of the phone upgrades available to us. (Erik got a new phone for free, and I got a discount.) I wanted a phone with great reception, as we live sorta in the country, and often have to stand in just the right place to get reception. I also wanted something durable. I've always had bad luck with phones falling to pieces just after their warranty is up, and with a baby around I expect phone drops and mishaps.

We picked out this Motorola V325, and I'm very happy with what great reception I get. (We do not pay extra to get the nifty "VZ navigator.) I can talk on the phone laying in bed, instead of standing on it or running outside every time my phone rings. It also feels really sturdy, and has this grippy rubber around the edges.

Erik and I were happy and impressed that Motorola used a mini USB for the charger port, rather than some proprietary plug that you'd have to go buy something special if you wanted to hook it to your computer. We were excited to get to use the camera on the phone and download them easily onto the computer. Also, I was excited to create or pick my own ringtones and upload them. The phone itself is equipped to make this happen easily.

Verizon, however, has disabled the phone's ability to transfer things to and from your computer easily. Motorola built the phone so you can easily upload your pics, but Verizon made it so you HAVE to go through them, for $.25 a pop!!!, if you want to get your pics off your phone. And no, I can't get the TMBG ringtone I want, either. Verizon has made it so you have to buy your ringtones from them.

NOT ok in my book. What's even more annoying is that Verizon isn't consistent about it. Some phones you can do these things without going through them. Erik is getting a different phone, because he would really like to be able to easily take pictures of Jasper, and not have to pay to access them! I have yet to decide if I want to sacrifice the reception and durability.

Does anyone else think this is terrible customer relations to do this? Sure, it's profitable for them - and it's really tempting to want to keep the pictures you take. But $.25/picture is more than it costs to buy film and develop hard copies!

Share your Monthly Bills...

2006-10-04T16:17:00.000-07:00

Our two-year contract with Verizon was finally done, and it was time to shop around. We'd been thinking of switching, but then so much of our family uses Verizon that we weren't sure.

Here's a money saving tip, that we just applied: Share your family plan with MORE of your friends and family. Now, instead of ~$75/month split between two of us, the bill will be ~$100/month split between us, two uncles, and a grandma. That makes our share $40/month for a savings of $35/month!

Also, we've been renting two to three movies a month. Hollywood Video has a monthly deal for three movies at a time, and many rentals as you want a month, for $15. We found two others who wanted to go in on the deal, added their names to our account, and now we all can have as many rentals as we want, one at a time, for only $5/month. Erik drives past the video store every day on his way to and from work, so it's no extra effort for us to pick up and drop off in person. So this will be another money saver for us, saving us about $3-$10/month.

Hurray!

Shocking!

2006-09-29T20:52:00.000-07:00

So, it's been a few days past the 30 days that our insurance company gave themselves to get back to us regarding our appeal for coverage.

I was tempted to call them and ask what's up today. I was then going to begin looking for a lawyer to help us out. But, I decided to give them until the end of the month.

Today, we received two letters in the mail from the insurance. The first one was yet again another bill-like notice. Like all the other claims, the notice reports the midwives as out-of-network, after we had in writing they would be covered at in-network rates.
Unlike all the other claims, it actually said "patient pays $0." Cool! They were actually going to pay something.

The next letter was in response to our claim. I was *shocked* at what it said.
The gist of the letter was: Sorry. You were right. We were wrong. You did everything you should have done, and in the right way. We're sending $X (the full cost of the birth) to your midwives.

I did the happy dance today. And we bought pizza for everyone.

Set up for Fincial Failure

2006-09-22T08:06:00.000-07:00

Although I decided very early on that I'd do whatever it took to stay at home with my children, I found myself strongly defending the working mother yesterday. Sure, it IS a choice - but for most it's a choice between impoverished (by American standards) living and getting by ok.

It's seems my generation is set up to fail, financially, from the get-go:

- Lack of financial education
We are NOT educated about financial matters in our school systems anywhere, unless you choose an optional money management class while in college (when it's already late in the game).

In fact, my Mother-in-law told me how her kindergartener is already being taught to live on credit! He was sent to school with a bagged lunch, and no money to buy a hot lunch. It being his first experience with school lunch, he didn't really understand how it worked, and got in line for the pizza and chocolate milk on the menu at school. They gave him the food, and simply charged it! They just assign the kids numbers and charge the meals, sending the bill home to Mom and Dad. It's teaching kids to live on credit from the beginning. My MIL must write letters to the school saying that her children are NOT allowed to charge their meals, yet she still gets bills sometimes. (With no way for her to monitor what's really being purchased, or who's really doing the charging.) Bad deal.

- Cost of education
The cost of higher education is just going up and up, with federal aid being cut, and student loan interest rates going up. Those with parents not helping financially (for whatever reason) are finding it next to impossible to leave college without debt.

Take my own case, for example. After high school, I didn't go directly to college because I couldn't afford it. For a year, I worked three jobs and saved almost every penny. I got a full-ride scholarship to a community college, and went there for my first two years. During my second year, I worked as an RA- again saving most every penny I could. I didn't expect to be able to go on to my bachelor's right away, because nowhere in state had the major I wanted, and out-of-state tuition seemed too high. Then, I was offered a very generous scholarship (my 3.9 GPA helped) to Washington State University. I immediately called WSU's housing department to get interviewed to be an RA (free room & board is a great deal) and was offered a position. I figured between the scholarship, the job, and my savings that I would be able to afford it. Well, between the cost of tuition raising every term (at a higher rate for out-of-state students) but my scholarship and wages remaining fixed, strict standards for being able to gain state residency (hopeless), and unexpected fees, I was out of money in one year. Cash flow was GONE.

University of Idaho, just a few miles away, was willing to let me pay in-state rates - and I figured it would be less expensive there even without the help of scholarships and paying my own room and board. (Of course, with yet another transfer there were requirement changes that tacked on more time at school, meaning more money.) I got a new job, applied for scholarships, and nervously took out my first loan. By my fifth year of school, I was finally old enough that I didn't have to report my parents income on the FASFA (not that my parents paid any of my tuition in the previous years) and I qualified for a small grant. With all that, I graduated with $12,000 in student loan debt, which didn't seem bad to me at all. I consolidated right away to lock in a low interest rate (less than 3%) and paid as much as I could each month. Unfortunately, my career path was one of non-profit work - and my income was not big enough to really take a huge bite out of my loan. I still have more than half of it to pay off, which isn't too bad, I guess, for having been out of school three years now.

- Predatory Lending
I don't recall a day in college where there wasn't a booth or a mailing somewhere offering me a credit card. My parents had always instilled a "don't live on credit" philosophy in us, so it was easy enough for me to resist the temptation. But then, I got really low on money and was concerned about my ability to pay bills. I got a credit card for "just in case." (I chose it based on the 0% APR, and the cool Van Gogh design.) I used my card to buy things online because it was more secure than my debit card, but never carried a balance. Among my peers, I was an exception. I was one of the last I knew to get a card, and most people I knew DID live on credit. "We're young. We're supposed to have fun," was their reasoning. One guy I knew racked up $10,000 in credit card debt in his first year of school. And he was just one who told me about it. I never even noticed if he had any nice "stuff."

- Health Care
I was dangerously and stupidly without health insurance for a while. In my mind I couldn't afford it. I did get sick frequently, and have daily medications I have to take. Doctor bills really add up! When I did buy the student health insurance, I still had to pay full price for my meds, and all the copays for doctors visits, plus whatever else insurance wouldn't cover. I ended up paying more in health related expenses after I was insured than I had before. Fortunately, I never did have an emergency while in college, and that would have made a big difference. Besides tuition, medical spending was definitely my biggest money eater through college.

- Gettin' hitched ain't free
So Erik and I were married in a very low-key nontraditional way, at close to no cost. But that's not the price tag I'm talking about. It's good that Erik and I are both frugal, and consumer-debt free, but he also had student loans - and not at the same low fixed rate I did. We worked hard and fast at getting rid of that debt, but still it was there.

- Makin' babies ain't free
Well... maybe making them is, but birthing them certainly is not. Because insurance rates are so high, many employers are offering less and less health benefits. If you were paying for the whole birth, insurance free (a very bad idea), the least expensive route (besides attempting to keep the whole thing a secret, never seeing a doctor, and birthing in a back alley somewhere) is a midwife - which averages around $3,000-$4,000. Don't even think about a hospital birth without insurance! With insurance, you'll still probably be paying a few thousand dollars out of pocket for a birth.

- Competing for a home
When women entered the paid working world, they doubled (well, increased anyway) the income of their homes. But, the housing market is based on what people will compete for and are willing to pay. So, when people's buying power doubled - so did the cost of homes. It's not anywhere close to the same story it was for my parents buying their first home, or their parents. Read "Two Income Trap" for a more complete picture.

- The rules have changed
Some of us did have great financial examples in our parents. Unfortunately, due to everything listed above, you can't "just not worry about it" and "get by" these days. Yes, the basics are still the same (spend less than you earn, etc.) but the vigilance it takes to live by those rules has increased. If you do get by, there's still a huge lack of safety net if one member of a two-income home loses a job and can't go back to work. Job stability ain't what it used to be. Retirement and health benefits ain't what they used to be. And because of incresed life spans (and the medical costs often associated with it) inheritances ain't what they used to be.

So, although Erik and I both have college degrees, they are only a small advantage due to the fact that neither of us pursued high-income career paths. Had we been in the same relative financial position a generation ago, me staying at home and us buying a house would be a relatively easy option.

Also-
As far as working mothers go; anciently, mothers have always worked - only recently have they not been allowed to take their children with them to work or have their children work along side them, and THAT makes a big social difference. I would actually love to work a paying job again, but only if I could bring Jasper with me, and finding somewhere like that is unlikely.

Sock Dreaming...

2006-09-22T08:01:00.000-07:00

Today, if I had extra money to blow, I'd blow it on Baby Legs and Socks from Sock Dreams. I wish!

Low-Income Homeownership

2006-09-19T13:42:00.000-07:00

Erik and I would like to get ourselves edjumucated on first-time home buying. We're doing very well not spending much of the money we bring in, but it would be good to have a better idea of what we're saving towards, and when we can use that saved money.

We know there are all sorts of incentives and helps for first-time home buyers.

Here is our dream:
-Buy some land (2-5 acres) close (meaning as close as possible) to the family.
-Build our own small home and farm the remaining land.

Here are some questions we have:
-Would it be better to make a strong effort now to find a home -any home- while we can still qualify for benefits for those in the "very low income" range in the area?
-How much can we afford to pay per month in a home where we'd still like to be saving toward our dream.
-Where can we find a free class on first-time home buying?
-How in the world do people with our income afford to live in homes?
-If we keep going just as we are now, how long will it be before we can afford what we want?

Tips? Pointers?

Profitable Hobbies

2006-09-13T14:02:00.000-07:00

Erik and I love to dance! We met dancing, and we often chastise ourselves for not getting out dancing enough these days. (Erik working early hours is the biggest inhibitor - not being relatively new parents as some may think. We just take Jazz with us when we go.)

I used to teach community and university dance classes when I lived in Idaho, and it was a blast. Now, I have a prospectus to fill out to teach once again for Mt. Hood community college's community ed. courses. Hurray! It would be so fun to be teaching once again, and teaching with Erik will be even better.

Insurance Battles continue

2006-09-08T15:05:00.000-07:00

Did I mention we sent in the official written claim to our insurance? We also faxed a copy of all the denials, and letters promising coverage previous to the birth, to the birth center's billers.
Jasper is six months old now, and they've still denied every claim, after promising coverage before his birth.

I'm totally at a loss.

We just received another denial of benefits in the mail today. This time, they've yet again chosen new reasons to deny. This time, they're also much more cryptic reasons - not so obvious that we should appeal:

"This procedure or supply is part of the global service. These charges are not eligilbe fore separate reimbursement."

and then follows:

"Your claim my have been separated for processing purposes. An additional charges will be processed as soon as possible."

In other words, we separated these items for billing purposes, and deny your claim because these can't be billed separately. At least that's what I'm understanding here.
It also shows the chart for out-of-network coverage... when they told us they would cover at in-network rates.

I can't believe this insanity!

Vacation

2006-09-06T19:38:00.000-07:00

We just got back from a trip to go visit my sister's family in St. George, Utah.
By our standards, we did not vacation frugally. We did, however, work in almost 100% for the vacation, so we didn't worry at all about money and we didn't go over our budget.
The biggest money-sucker was eating out almost ever lunch and dinner. Eating out, as I've written before, is usually part of our vacation planning, so there was no guilt (although there was a lot of gas, but that's another story).

I had an only-available-in-Utah, Sconecutter cookie dough shake. (ok, I ordered two on different days, but could only eat half of each) Erik had never even heard of a Navajo Taco, so one of these days we'll have to get him a real one. He had the Sconecutter version, and I had one of their egg sandwiches. Not that I love Sconecutter's, it's just that you can't get anything like it anywhere else.

We bought food at no less than four different Mexican restaurants, probably more, and one nice Thai food place.

Other than food, we didn't spend that much. No hotel. We pitched in for the cost of gas. My sister already had a pass to Zion's National Park. And the dinosaur discovery museum we went to was only $3 per adult.

Well, it's time to go back to doing laundry and cleaning - recovering from the vacation.

Oh, and we decided it probably would be cheaper to drive instead of fly next time we head down there. And we'll have to go in early spring or late fall. Too darn hot!

I've been Hacked!

2006-08-24T21:16:00.000-07:00

Welcome Parent Hackers. This blog is simply where our family is publicly sharing our financial adventures. Sometime I write about frugal tips, sometimes I try to sort out how to handle our money (like if we should save for our son's college, or if I should self-publish my book or not), and I try to remember to review finance related books I've read (The Only Investment Guide You'll Ever Need, and All Your Worth are favorites).
Thanks for stopping by!

Should I Self Publish?

2006-08-24T08:04:00.000-07:00

An old co-worker was trying to explain to me why he would be upset if his future wife did not take his last name. I never could make sense of his argument (although I did choose to take my husband's last name) but one thing he said has stuck with me. He said, "You have to do a cost benefit analysis for everything, right?"

I'd never thought of it before, doing a cost benefit analysis for everything? I'd always sorta kept the concept work related, but everyday life related CBA makes sense!

So, I have a picture book story in the works. The illustrator is drawing, a content editor is reviewing, and I have some decisions to make. There's the find and agent and get published route, and there's the publish yourself route. If I'm looking at publishing from the financial angle, which would benefit me more? I've been reading self-publishing guide books and I'm still not sure.

With an agent and publisher, my cut of the income from the book is diminished. If I go through a Print-On-Demand place like Amazon's Book Surge, it's higher. If I go at it alone, it's 100%

An established publisher would have access to marketing and placing my book in places far beyond my reach. Although, if it doesn't do well off the bat, it may not stay in print long, cutting out long-term gains. I've read that you still need to market your own book heavily even if a known publisher gets it out there.

Marketing is NOT my strong point. I'm hesitant about selling myself. I don't know why. I mean, I do have self confidence, and I don't mind others' praise at all - but selling something by singing my own praises makes me uncomfortable.

Self publishing sounds like a lot of work, investing a lot of time and my own money up-front. However, I wouldn't have to worry about losing control of my work. I still choose the title, the illustrator, and how long it stays in print. I really like the idea of having the final word on my own creative work.

I don't have to decide today, but the ideas are stirring... any advice would be appreciated.

Frugal Photos

2006-08-17T19:38:00.000-07:00

We have a five month old son, and of course, we're very proud parents. This leads naturally to LOTS of photos.

It goes without saying that digi-cams are the way to go. No buying film, no processing any paying for the ones that don't turn out. With Flickr, photo sharing is also easy. We have family spread throughout the country, and my parents are in Germany right now. It would get pretty spendy printing up and sending pics all the time. We HEART Flickr.

But, sometimes you really do want hardcopies. Picture frames need prints. Printing your own is ok, but the cost of ink *really* adds up, and the quality just isn't the same. Many online photo printing places have introductory deals. I got 20 free prints on my first order with both Shutterfly and Snapfish. Shutterfly often sends out emails with great deals, and I'm about to cash in on another round of 20 free prints. This is a good deal.

Road Trips

2006-08-11T14:52:00.000-07:00

Three money lessons I've learned on road trips...
From a comment I left on J.D.'s Get Rich Slowly today (he just learned about paying parking fees at his hotel):

Personally, I have to be careful what snacks I pack for road trips. (Too many snacks = too much eating, and feeling icky from all the junk.) Buying something when you stop to use a bathroom is like a tip - and after I visited Italy where you DO tip to use a toilet, I though 'Nobody deserves a tip more than the person who cleans the toilet!' (I usually expect to eat out while on the road, so I just budget for it. It's part of the vacation for me.)

I had a question about tipping my first time in New Jersey. I’d never lived in a state where you don't pump your own gas, which means if someone else pumps, you tip. I drove by every gas station looking for a self-serve station, and finally gave up. (Learned later it's like Oregon, you don't pump your own anywhere.) I tipped the guy, but I had no idea if it was the right thing to do, or how much was right. (Noted: no need to tip in states where full-serve is state law.)

I also had trouble on a road trip finding a place to camp overnight where there was no fee. A traveling "hick" (sorta) myself, I'd never paid to camp before. We finally did find a free place, but I was nervous because I wasn't sure camping was even legal there.

Happy travels! Even if driving ends up more expensive, a drive along the Pacific Coast is a must-do. The view is worth the money.

More Baking Soda

2006-08-10T13:44:00.000-07:00

So we are close to being out of our store bought toothpaste. Erik has used Cinnamon Crest (which I couldn't stand the smell of while I was pregnant, but it's fine otherwise) and I've been using Tom's of Maine's Silly Strawberry. (It was the only fluoride-free toothpaste I could find at the time... but that's a different story.)

I've been browsing around online, 'cause I know you can use Baking Soda (the household wonder-product) to make a toothpowder or paste. I made a trial toothpowder and boy is it salty! I added more baking soda to try and dull it down some, and it's slightly better. I have some fresh mint drying that I'll grind up and add for flavor once it's ready. So the verdict for me so far is "Wow, salty! But I'll keep trying." My teeth feel nice and clean, though.

Here's what I did:
A few spoonfuls of baking soda (for cleaning/whitening)
a spoonful of salt (for cleaning)
a few drops of hydrogen peroxide (for whitening)
a drop of tea tree oil (for disinfecting)
and some ground rosemary ('cause the plant that lived in my bathroom had dried out, and for flavor)

I put them in a small jam jar with a lid, wet my brush, and dip it in.

Cost in money: Oh I don't know, I already had all the stuff to make it
Cost in time: A few minutes

Review - The Only Investment Guide You'll Ever Need

2006-08-09T13:01:00.000-07:00

Andrew Tobias wrote a fantastic book, and says that in a weak moment he let the editors talk him into calling it "The Only Investment Guide You'll Ever Need." This is one of the few books I passed on to Erik and said "read!" When he finished, he replied, "it just may be the only investment guide we'll ever need."

I read this book during a spell of reading other "investment guides;" A few of Suze Orman's, a few of the Motley Fool's, and another, I think. Suze Orman's were good, but felt a little too marketed for me. (Things like the recurring "log onto my website and type in this special password for more up-to-date... or "watch my tv show." Plus her makeup makes me nervous sometimes.) Not that she doesn't have good things to say, and she definitely have more substance than can be found in "Rich Dad, Poor Dad" but still heavy on the marketing. Motley Fool's books also hold up just fine in their brand of advice (they really really like dividend stock investing) and try really hard to add a twist of humor to what they say (throwing in Shakspeare humor whenever they can).

Oh Sorry, I'm supposed to be reviewing Tobias' book here. It's definitely BETTER than any other investment guide I've read. Sound advice. Simple advice. Natural humor. Loved it. With chapters with titles like "What to do if you inherit one million dollars; what to do otherwise" and "Choosing (to ignore) your Broker" you can already see a glimpse of his humor.

Thanks, J.D. at Get Rich Slowly for recommending this book to me. I'm glad to see he's also reading another favorite of mine, "All Your Worth."

I'd say read (or even own) "The Only Investment Guide You'll Ever Need" for most investing advice and general finance guidelines.
Read "All Your Worth" to help you put a budget together (unless, of course, you already have a budget that you're sticking to and that is working fantastically for you).

In Short: One of, if not THE best money book I've read yet.

Procrastination is a Killer

2006-08-09T12:49:00.000-07:00

Procrastinating getting that budget put together, getting out of debt, or beginning to save with really getcha in the long run.

I keep procrastinating book reviews I mean to do, and then wait to long so I can't do a quality review because I've forgotten the best parts and the details.

Procrastinating reading books I've gotten from the library leads to having to return them unread when someone else wants them and I can't renew them any longer.

I subscribe to several blogs through an RSS feeder at bloglines, and occasionally procrastinate reading entries that look interesting, but I just don't feel like reading at the time. I have a backlog of 35 posts to read.

Ok, so I guess I have to do low quality book reviews, 'cause I at least gotta say something about the books I've read. At the very least, you can look at the side bar... books in the + column are ones I read and liked. Books with a - mean I wouldn't suggest reading them, there are much better books to spend your time one. Ones without a + or - just mean I read them, and don't feel strongly either way.

Ramit at Iwillteachyoutoberich.com loves to post about getting up and DOING something.
Age old advice, always wise.
The War of Art talks about HOW to fight those inner battles that keep you from getting up and DOING something.
Joe's Goals is helping me DO some of the things I want to do. My latest goal: Do as well or better than yesterday. (Joe's Goals gives points for getting your goals done, so it's easy to track "how well" I've done.)

Investing in My Own Ideas

2006-08-03T10:38:00.000-07:00

It may not cost as much as I originally thought it would to invest in publishing my picture book. I had a nice phone consultation with Nina from BookSurge, Amazon's self-publishing company.
I'm feeling good about it.

As of now I need to:
*find a professional content editor that specializes in picture books to give me feedback on the story
*save up the money to do the publishing
*continue researching avenues for publishing and marketing
*wait for the artwork and decide if I have enough skills and tools to do the layout myself or to pay a professional to do it.

I think a time frame of one year will be good for me to save up the money, and have a product I can submit to a printer somewhere and get crackin. Sound possible, Dalyn [the illustrator]?

Big Changes Ahead?

2006-08-02T06:17:00.000-07:00

Notice the title of this blog is YELLOW's Green. Yellow does not mean we are chicken. Yellow is what both Erik and I score on Dr. Hartman's Color Code Personality Test. On the front page of his website, you'll find that Yellows "are the fun lovers. Fun, or the joy of doing something just for the sake of doing it, is what motivates and drives these people. They bring great gifts of enthusiasm and optimism and are generally charismatic, spontaneous, and sociable."

Of course he's going to say only positive attributes on the front page. In the book, you'll also read that in the career/financial world, Yellow's are the least likely to succeed. It's a result of being a fun-seeker. In college, I studied music composition because it's what I enjoyed doing. (No surprise, I didn't enjoy it nearly as much once it became something I had to do.) I even knew I didn't want to be a movie/tv score writer - because then I'd still be at the mercy of creating something to fit what someone else wants. I didn't want to be a teacher, or a professor, so really composing as a career was out. So why did I do it? For fun. When it was no longer fun (due to a piano faculty that attempted to vampire my musical soul) I got out. I like to think of my General Studies degree a certificate of creative problem solving. (Problem = how to still get a degree after five years of ever-more-expensive college while circumventing the wrath of the nasty professor.)

Erik has a degree in German Language. He's fluent in both French and German, and has a working knowledge of Spanish. He LOVES languages. To him, they're fun. He was smart to get in some great travel time while he was young. (Read the "I Will Teach You To Be Rich" series on what to do while you're young.) Erik has also been through auto mechanic's school, but isn't interested in being an auto mechanic as a career, because it fixing cars all day doesn't sound like fun. Buying cars, fixing them, and selling them did sound like fun, though, and he was self-employed doing just that. (The largest non-cash portion of our net worth is our cars.)

I've mentioned my changing thoughts on being a teacher. From any teaching experience I've had, I now think that as far as careers go, it would be fun. But I'm not certified, and I'd have to go back to college to do so. As we're in the "start your family" stage of our lives, and I highly value stay-at-home motherhood, NOW is not the time for me to go back.

Erik, has the natural skills to make an excellent engineer. Especially with the usual salary attached, it sounds like a fun career to him. Unfortunately, a degree in German does not an engineer make.

He has to take same college courses for work anyway, to acquire a journeyman's license and move up the current pay ladder. So, he's been looking into what kinds of engineering careers he could pursue, and what it would take to go back to school part-time while still working to support our family. He figured it will take about ten years to do it. Would we be better off if he instead just worked an extra job now? Is it just for the money, or really the desire for a fulfilling career? What does that mean for the next ten years?

In any case, it looks like our education savings fund is about to earn a bigger allocation...
Wish us luck in whatever we decide!

Networth IQ

2006-08-01T15:55:00.000-07:00

I found NetworthIQ through a badge on another money blog. (See our new badge on the sidebar.) You can track your progress, and compare to other users. We are pretty low ranked in our net worth relative to the comparisons I've looked up, but what matters more is how we're doing since we've started working on it...

The dip is in March, when our son Jasper was born. But because we planned well, it didn't take long before we were doing even better than before.

(Side note: United Health Insurance has still not paid for his birth. We did meet someone this weekend who finally did manage to get United Health to pay for her delivery at Alma Birth Center, the place Jasper was born, after almost six months.)

Grumble grumble at eBay

2006-07-30T20:51:00.000-07:00

So we're once again working on a weekend of clearing out stuff.
I had two items posted for sale on Craigslist for a week or so, but with no takers, so I decided it was time for eBay.

The thing about eBay is all the extra fees. Posting fees. Fees for extra pictures. Paypal fees, etc. If you can find a buyer on Craigslist = no fees, but a bit extra effort to make the actual exchange.

So I went through the effort of posting these two items on eBay yesterday. In the past, we've made a note that we can't accept credit card payments, but other Paypal payments were fine. The reason for this was the added fees. To accept credit card payments you must upgrade to a business account, and they charge you more.

This morning, we got an email from eBay saying our listing had been removed because it's against Paypal's terms of service to say that you'll accept Paypal bank payments, but not Paypal credit card payments. And poof, the listings are gone. Not even a saved template where you can go back and say "fine, I'll pay your extra fine to let them use credit card."

So we looked it up and here's how it works. You can't accept Paypal and say you don't accept credit card. You don't get hit with the extra fees until you're a business account. You have to be a business account to accept credit card. Once you are a business account, you pay the extra fees even if they DON'T use credit card. You can only downgrade from a business account once, and we've already used that one time.

So our new opinion: eBay Stinks! We also don't like how the bidding system is set up. We think it would be a better option for all parties involved to keep the item listed until there are no bids for a while. That way, the seller can have an idea what it will go for, and people that really want it will pay what they feel it's worth. Instead, you get it listed for a set number of days, and those who want it bid at the very last second to try to get the best deal.

Luckily, I suddenly got replies on the Craigslist postings, and have fee-free buyers for both items!

Berry Expensive

2006-07-26T11:47:00.000-07:00

Raspberries and Blackberries are on sale at Albertson's, 2 pints for $3 according to this site.
U-pick for $____ (I couldn't find prices online. I think it's because raspberry season is past. I found $14/crate for blueberries, though.)
Buy and plant your own vines, $4.50 + work and effort to grow them from this site.
Pick raspberries from a friend's patch $0, plus time.
A friend picks and gives to you, $Obligation to return the tasty favor in some way.

We spent much time picking raspberries this month.
Then we purchased a steam juicer and made sweet raspberry juice. Fantastic during the HOT weather.
I won't tell you how much money we didn't have to spend on berries...

Blackberries will be ripe soon, and they grow wild (=free) all over this area.

Paying for College

2006-07-13T15:30:00.000-07:00

As of today, I'm happy with my choice to start contributing to a 529 college savings plan. I've read a few posts on financial blogs lately about the topic of paying for kids college. The author of I Will Teach You To Be Rich posted his thoughts about it today. J.D. at Get Rich Slowly also posted recently. I've posted as I tried to make the choice.

The reason I'm so happy with my choice is this:
It's tax-advantages savings that I have control over. Sure, it may go to Jasper's college expenses. But maybe it won't. The good part is I can start saving today, but I don't have to decide about where the money goes yet. If we decide that our kids have to pay their own way, we'll have money set aside to use for our own future education, a possible retirement education fund.

Quick Insurance Update

2006-07-10T21:21:00.000-07:00

So the latest news is that the *real* reason for all the insurance claim rejections is lack of an attending physician.

Erik (to the insurance company on the phone): It was a birth center, with a midwife. We've given you all their information.
Insurance: But who was the attending physician?
Erik: There wasn't one. It was with midwives.
Insurance: But who do they work under? Who do they report to?
Erik: It's a birth center. They don't report to anyone...
Insurance: You know, like every nurse is under a doctor. It's the same with midwives.
Erik: No it's not. They're an independent birth center.
I: But then who's there if something goes wrong?
Erik: The hospital, five minutes away.
I: Well, what doctor at the hospital are they under?

They just don't get it! So, for the next claim, we'll get all the info. from the midwives we can about the emergency plan (which thankfully, was not needed). Perhaps we can even find a doctor's info that could possibly have attended to any emergency situation, just to make the insurance company happy.

The thing that really gets me is that using a birth center vs. a hospital saves the insurance company money. It's so much cheaper! Oh well... the adventure continues.

He Did It!

2006-07-10T20:34:00.000-07:00

Remember when I posted about ingenuity, and the One Red Paperclip Guy? (Kyle is his name.) He took the "bigger and better" concept - with a goal - and went all the way. He managed to trade up one red paperclip to a house, in one year. Awesome.

Insurance Trouble

2006-07-06T10:00:00.000-07:00

It's still not over. After the last phone conversation with insurance, they've still denied every claim having anything to do with Jasper's birth. So now, we have to do a written appeal. Roar!

The good thing: we kept track of every person we spoke with, what they said, and fought the hard battle to get everything in writing. If we hadn't done this, we'd be a lost cause. For now, we can keep fighting with our heads up.

Morals of the story:
Births are expensive. Save your money, and expect it to cost you more than "they" say it will. If you even think of non-trad births (we used a birthing center with midwives instead of a hospital) expect them to really fight you. (Our benefits say in-network midwives are covered 100%, and then don't include ANY midwives in the entire state of Oregon in their network.)
Get EVERYTHING pre-authorized by insurance IN WRITING. Even if you do (and we did) they may still try to stick you for things they said they would cover. (In our case, the cost of the entire birth.)
Use your benefits person at work. The insurance company may treat you better if there's threat over losing your entire company's business. Your benefits person should also know the right people to talk to for getting results.
Don't be afraid to go to the insurance commissioner. We couldn't do this effectively because our insurance company is not based in the same state as our service, so we'll unfortunately have to go to a federal level with this (read, less likely to get positive results).

Loan Trouble

2006-07-06T09:26:00.000-07:00

There's a great reason to have a good buffer in any of your withdrawal accounts.
I keep a $200 buffer in our checking account, to cover any forgotten about or mistaken withdrawals. I chose $200 because we have $150 set up to auto-withdraw for our IRAs every four weeks, and $25 for the 529 plan once a month.

I had my student loan payments set up for auto-withdrawal once a month as well, but I've been paying them online instead, so that I can pay more than the monthly minimum. Last month, I noticed the option to change due dates. I thought it would be a good idea to change the due date to the 1st of the month, like most of our other bills.

When I was going over our money last week, I was confused for a while that we had some missing money, until I figured out that the loan auto-transfer had taken place, even though I'd already paid that month's bill online. With that on top of accidentally taking our weekly cash out of checking instead of savings, I was grateful for the buffer. No overdraft fees!

To my surprise, the auto-deduct happened again this week! Last week, it was on the old due date, this week, it was on the new one. Thankfully, there was still enough in the buffer.

The only question I have now is on the interest my loan is charging me. They charged almost the same amount of interest on both deductions - even though there were only a few days between them. That doesn't make sense to me. If they're charging an annual percentage rate, one month and a few days worth of interest should be different dollar amounts, no?

The Point

2006-07-06T08:43:00.000-07:00

I've been thinking about blogging and blogs in general lately.

First, I was thinking, what's the point?
Well, with our other blog, it's easy. It's simply an online scrapbook of our lives. Simple. Doesn't matter if anyone else reads it, or comments (although we love comments), it's mostly an excellent way to keep a digital notebook of our lives.

But this one has a different point. It's meant to share what we learn, and chronicle our adventures in the financial world. But what's the point of sharing when you have a readership of two? Why read this blog when there are so many other excellent money related blogs out there? "Well Amber," the two readers reply, "It's because we know you."

So I've been thinking about what makes a quality blog. What keeps me reading the blogs I read, besides just ones of people I know? Here are some of those things:
*They look pretty. Yeah, I'm going to end up reading them from an RSS or atom feed anyway, but when they look nice, it just gives the impression that they put more thought into the whole thing. I don't think this blog looks pretty at all, and I sure would like to change that. Maybe I could at least use more pictures.
*They are useful. Parenthacks is full of great ideas. Get Rich Slowly is full of great advice. But who am I to advise? But, as the popular [not] Nelson Mandella quote responds, "Who am I not to?" So, as I have advice about money related things, even if I'm not following them completely, I should share, yes? Erik and I are frugal enough without even thinking about it, that I should share what I notice may be helpful to others. Like expounding on the virtues of Baking Soda!
*They are often entertaining. See PunnyMoney, for example. Trouble is, a lot of the best financial advice isn't. Buy and hold - for a long time. Budget. Once you're set up - there's not really much exciting business to talk about. But as this is about our adventures, I'll try.
*They're not too personal. Well, too bad. This one is gonna be personal. But, to be useful to people, I'll try to find the lesson in our personal adventures so they'll be worthwhile. For example, if you want your rent deposit back from a lazy landlord, threaten them with court in writing - and if you research, you can make the threat really scary for them by saying things like "The law (ORS 90.300) says that I am entitled to twice the amount wrongfully withheld."

Baking Soda in the Bathroom

2006-06-26T14:57:00.000-07:00

Baking Soda is great, and I mean really great.
You can use it for everything. Well, maybe not everything, but perhaps half of everything. Food, air freshener, non-toxic cleaner extraordinare. There are so many good uses for Baking Soda, that I'm going to begin collecting and sharing them here. You can get 16oz. for around $0.75. Let's start with where I use it the most regularly, and compare prices, shall we?

(in big wrestling or bad car dealership's announcer's voice)

"Baking Soda in the Bathroom"

(don't forget the corny echo here)
(End announcer voice.)

Air Freshener: I leave a small open box near the toilet. It's an odor absorber. With the occasional open window or match, no additional air freshener is needed. Maybe I'm just naturally not-stinky, you argue? Think again. ;) I use cloth diapers on my baby, and the dirty ones live in a vinyl bag in the bathroom.
box of baking soda: $.75
potpourri: $2.97 on sale
glade plug-in: $6.99
plug-in refill: $3.45
air freshening spray: $4.99
fancy-dancy time release freshener: $42.52

Toilet Bowl Cleaner: Every time I *ahem* "go number two" I sprinkle some in (after flushing) and do a quick go around with the toilet brush. It's the only in-bowl cleaning I have to do.
box of baking soda: $.75
nifty-necked bottle of toilet bowl cleaner: $2.63 bulk and on sale
drop in the tank and forget about it type: $8.99
no-touch disposable type: $27.54

Drain Cleaner + Freshener: 1/4 cup down your drain, followed by 1/4 vinegar. Seal tight till fizzing is done, and then flush with hot water. (I also periodically pour boiling water down the drain. Leftover water in the tea kettle, or when straining pasta, saves boiling time and energy and works great.)
box of baking soda: $.75
White Cleaning-Grade Vinegar: $2.99/gallon
Liquid Plumr: $11.99

Sinks and Counter Cleaner: I plug up the sink, pour in some in, add warm water and go for it. Alternately, sprinkle it around just like Comet, and use in the same way.
box of baking soda: $.75
some sink specific cleaner/sanitizer: $16.64/Gallon
comet: $1.36 buying in bulk

Floors: When the sink water is done cleaning counter-tops, I throw the mop in it and go for the floor.
box of baking soda: $.75
Swiffer Wet-Jet: "Starter Kit" $19.99
Floor Cleaner: $2.29

*The following I haven't used yet, but plan to. I know there are easy recipes out there, and will post them for reference on this blog:

Hand Cleaner (Aka soap), Toothpaste, Body Freshener/deodorant, Mouthwash, Shower Curtain Cleaner, Brush & Comb Cleaner, Bath Soak (Oh, how I wish I had a bathtub of my own...).

And this is JUST in the bathroom. I'm telling 'ya, Baking Soda is amazing.

***DISCLAIMER***
Prices were found by a quick and painless search on Froogle, and you may easily find different prices when you look. I'm not even going to promise that I got all the links right. I am not endorsing any of the products linked to, nor the sites they are listed on. I am endorsing baking soda, but am not getting paid a dime, nor am I endorsing any brand. Why a disclaimer, Amberlynn, you only have about two readers anyway? Because you just never know.

Totally Off Topic

2006-06-26T14:20:00.000-07:00

I dislike this template, and I haven't found anything among the templates found on blogger that I do like. Of course, I'd like a theme to have something to do with yellow and/or green, but I'm having trouble finding a free template I like. Any suggestions, anyone? Is there an easy way to make your own? (I do have Dreamweaver, from the days I used to have a website, but it's a pretty old version.)
Help? Sources? Anyone?

We Can't Afford a House - YET

2006-06-23T22:40:00.000-07:00

Currently, we're saving $300/month specifically for a house downpayment or adding on to this one, or whatever.

The money gets parked in a Money Market account with a 4.8% APY.

If this was all we did, we'd have about $35,000 in five years - less taxes.

Whenever I reach $500, however, I'm throwing the money into an ever higher yeilding CD. The 2yr CD I bought today has a rate of 5.36%(5.51% APY).

Of course, I can't put *ALL* the money in CDs with a maturity that long. We will need to have times where we'll have enough money access to take good opportunities.

I'm very encouraged!

OCSP 529 Plan

2006-06-21T09:21:00.000-07:00

After much waffling, I finally decided to join the Oregon College Savings 529 Plan.

$25/month will automatically go for college savings.

Unless the law changes in 2010:
Earnings will be tax-free, as long as they are withdrawn for eligible education related expenses.
Contributions will be deductible at the federal and state level.
Maintenance fees will be waived for Oregon Residences.

We Can't Afford a House

2006-06-20T12:49:00.000-07:00

We were presented with the opportunity to begin home ownership. (Sorta, but I'm not in the mood to get into all the details of the opportunity itself.)
My Mother-In-Law played with several different options on an amortization calculator, and I spent the day playing around with our finance spreadsheets to look at the possibilities. I came to the conclusion that we couldn't afford it. We could pretend that we could afford the smallest amount - but I had only factored in mortgage payments. Considering how it would effect our utilities and food bill would make it out of the question with our current situation. I'm not currently willing to turn me working into a necessity - so we declined the offer outright.

The moral of the story? We need to save save save as aggressively as possible, so the next time an opportunity like this comes along, we can take it.

My question is this: In saving so aggressively, should I make minimum payments on my student loan and put the rest toward the "dreams" pot, or should I remain aggressive in annihilating my debt. On one side of the coin, we're finally earning more interest than we're paying. On the other, getting rid of my loan gets rid of that losing interest all-together, AND would lower our monthly must-haves.

I'm currently leaning toward backing off on my aggressiveness toward paying extra on the loan, but using any extra income we may get - like me picking up part-time job, or selling a car - against my loan.

Simple Update

2006-06-20T12:38:00.000-07:00

*I never heard back about the job, so oh well.
*I did buy a CD, but only one. $500 for 6 months with GMAC. I figured if I want to start laddering, I'll wait one or three months and buy another one.
*I decided to leave the 401k with my original choices.
*I've been getting a 30/day free trial of the Investors Business Daily. Unfortunately, I haven't really been reading it daily, so I know it's definitely not worth my while at this point. Besides, I'd prefer online news - less waste of paper.

*I need help. I was reminded again this weekend of my issues with our current IRA status (through a broker instead of independent). Erik reminded me that they didn't even give us the deal they promised regarding their fees. We were supposed to be charged at the same rate as his parents, because they referred us. They are actually charging us more (because we have less money in our accounts). No good. They also purchased two funds without ever even consulting us on it. They only ever talked to us about one fund, but then went ahead and bought three. Erik's grandmother also wasn't too impressed with them. What I would like to do is keep everything exactly as it is - with Charles Schwab, and the same $s in the same funds - and just cut out the middle man. Unfortunately, I have zero idea HOW to do it. Should I just open another IRA and begin putting our money in to that instead, and leave what they (the brokers) already have alone? Can you have more than one IRA at a time? (We have one each.) It sounds like you can.

Applying for a Job

2006-06-16T15:56:00.000-07:00

So I occasionally browse Craigslist for work-at-home part-time jobs. Most often, they're outright sales jobs, or cryptic ads that don't tell you what the job is but say "contact us for more details" (read:sales, likely the pyramid scheme variety).

I don't NEED to get a job right now, but I keep thinking it would help our savings and help pay off my loan quicker. It would also be good for me to have something that will force me to get moving when I'm feeling lazy.

I would only apply for a job that would give me the flexibility to still mother Jasper full time.

Last night, I found the perfect job. It's for a "Great Escapes" Coordinator for the Starlight Foundation. In other words, I'd be planning fun events for sick children and their families. This is SO perfect for me! Not only is it work I can do while Mothering, it's right in line with my skill set. I'd still get to work in the non-profit sector, and do something I'd be proud of.

So last night and this morning I refined my resume and wrote a cover letter, and sent it off with Erik to fax for me. (The add said fax only.) Well, the fax number they gave didn't work, it went to an office phone directory line every time. I want the job bad enough, that even though the add said no emails or phone calls, I left a phone message saying the fax number wouldn't work, and I looked up their email address and sent my resume.

Wish me luck!

Review - All Your Worth Again

2006-06-16T12:56:00.000-07:00

THIS page is more than a review.
Please read it. What do you need me to do to convince you that this is the way to go?

It's also where we got the spreadsheets we use, although we've changed them a bit to meet our personal needs.

CD Ladders and Safety Nets

2006-06-15T14:36:00.000-07:00

We built up our ~7 month safety net pretty quickly once we put our minds to it. We also remember to factor in what it would need to be should our living situation change.

I just compared our monthly spending with the national average using one of Bankrate's calculators. We are well below the national average in almost all spending areas, except "misc." I remembered to include phone payments and student load payment in this area - so I wonder how that really does compare to the national average. Anyway, as I suspected, we are superiorly frugal: about half the national average for my age group. (We're at $935 according the their calculator, and average is $1886.)

We've done the math, and our monthly Must-Haves are actually a little higher at $1,017. We have $7,000 sitting in a money market account for a rainy day. While researching the best place to park money we're saving for down payment on a home (or something similar, like building onto this one) I came across the concept of CD laddering. This may be "duh" to you, but it's new to me, so I feel like explaining.

CDs, or Certificate of Deposits, are great if you want an exceptionally safe, short-term investment that you can do without touching at all for a given amount of time. Of course, as with most SAVINGS options, there are penalties if you touch it too soon (like losing all the interest you would have earned, or even paying back interest you would have earned but hadn't yet). They do, however, earn higher yields than Money Market accounts.

CD laddering is sorta the CD version of dollar cost averaging. Dollar-cost-averaging is when you make small installments, instead of large lump sums, into stocks or mutual funds because you never know if the market will go up or down. When it's down, you get more for your money. When it's up, you're still putting money in, and it will be that much better if it keeps rising. The same holds true for interest rates on CDs. They could go up, or down - but you almost always get better deals when you buy longer terms. So what you do is buy several CDs for different terms (term is the length of time you can't touch them).

Let's say you invest $1,000 each in a 3 month CD at 4.88%, a 6 month CD at 5.12%, and a 9 month CD at 5.12%. (These are the current rates at GMAC, one of the best rates you can find as of today's CD ratings on Bankrate.) In three months, you get your first CD back, and it's now worth $1,012. Now, you can take that money and put it back into a 9 month CD - and for fun let's pretend the 9 month interest rate has gone up to 5.25%, now it will be worth $1,053 at the end of its term. When the 6 month CD is up, you do the same thing. Now, every three months, you can purchase a 9 month CD, the highest earning "rung" on your "CD Ladder."

You can find CDs with terms as short as 1 month (though, they won't have a very good yield at all) and as long as 5 years (which will give you the best rates). If you're looking at investing money for longer than five years, you should probably look into other options besides CDs.

So I'm thinking... with $7,000 saved for emergency use over about 7 months, we would get a budget of $1,000 a month. We don't need to be able to touch all $7,000 in month one! Why don't I build a CD ladder, even if it's small like in the above example. When I compared rates, the 1 month CDs I could find are currently earning less than our Money Market account, so that doesn't make sense to do. But a 3 month CD does earn more, and I wouldn't want the hassle of buying a new CD every month anyway. So if I keep $3000 in the Money Market account for easy accessibility, and then $3000 in a 3 month CD, and $3000 in a 6 month CD - I'll have my little CD mini-ladder earning me even more "free money" than I would with all of it sitting in the Market. Trouble is, I have to come up with $2000 more before doing this would make sense.

We have about $1,000 sitting and waiting to see if we'll need it to pay for Jasper's birth. If insurance comes through like its supposed to (it's been 3+ months now), I could use that. I could also take some from our travel budget. Or just wait until we've saved it up.

Alternately, I could put about $1,000 each in a 3, 6, and 9 month CD. The trouble with that idea, though, is that we'd end up short in case of an emergency - leaving only $2,000 available in months 4-6.

Sorry, this has turned into an exceptionally long post. But, through writing this all out, I've decided what to do, so please be forgiving. (I'm usually long winded, so obviously if you're still reading, you are forgiving!)

I will keep $4000 in the market account and purchase just a 3 month CD with the other $3000. In three months, I'll know if that $1000 is available, and possibly have another $1000 saved. If that happens - I can add rung two to my ladder. If not, I'll at least have earned a bit more interest on that $3,000.

Revision on Portfolio Choices

2006-06-13T11:30:00.000-07:00

I'm already thinking of revising my 401k choices...
As I haven't explained yet, I chose the small-cap fund and the bond fund for exactly those reasons... they were the only choice for small-cap or bonds in the plan.

I'm rethinking for two reasons, though.
The first is I finished browsing YF&B last night, and it ends with a page of don't. One of the don't is "Do not... invest in a mutual fund with the letter A or B at the end of its name. That's a sign that there will be a sales commission attached-it can be 5 percent. That's a silly waste of your money." PTRA and GTSA both end in A.

PTRAX. So Bonds, I was thinking, are a secure, so why don't I throw SOME security in there, especially since this PIMCO fund currently hold a 5 star rating. Being conservative somewhere is wise, right? But now I think... I'm just 27 and Erik is 32. Now is the time to be aggressive. Plus, choosing an index fund is conservative enough for now. So never mind on the PTRAX. Then again, Google says this is a no-load fund. Where are the charges that the "A" at the end of the name indicates?

Small-cap surely isn't conservative at all, but I thought I should at least throw a little in the mix. But if that little is the only small-cap option they give, it carries added fees, has an unimpressive history, and has a low star rating - why bother. So, never mind to you too, GTSAX.

So that's 10% of our 401k allocations up for grabs.
Should I throw that in to the Aggressive "Lifestyle" fund, or divvy it up among the other choices... hmmm...

Retirement Portfolio

2006-06-12T18:32:00.000-07:00

I can't tell you how stupidly sophisticated I feel. Stupid, because I don't feel 100% positive about my choices - I still feel like I need to learn a lot more. Sophisticated because I did it - research and all. I made the choices for allocating our upcoming 401k options, and I didn't just choose the no-brainer "Lifestyle Options."

This is gonna diversify our current portfolio nicely, I hope.

Here's what it's gonna look like:
---
2.86% Bonds PTRAX in 401k
2.86% Small-Growth GTSAX in 401k
14.25% Mid-Growth CVGRX in Erik's IRA
60% Large Blend/Growth
25.7% SAGYX in 401k
5.7% RAFCX in 401k
14.25% NBSRX in My IRA
14.3% 500 Index in 401k
20% Foreign/World
14.25% AEGFX in Erik's IRA
5.73% TEMWX in 401k
---

Erik's 401k is offered through John Hancock. They sent him home with a really nice booklet laying out different retirement profiles so you can help set your savings goal, based on the kind of lifestyle you think you'll want, and a handy dandy calculator for how much you need to save each month now based on your age.

What I didn't like is that in all the funds they have listed, they don't give the tickers anywhere. You are just supposed to trust the (slightly outdated) materials they give your for all the information on your fund options. It also wasn't easy to find listings for fees. I finally found the expense ratios listed, but it didn't list anything about front loads or differed loads. I also have no idea what John Hancock's overall fee will be, and I don't like that. But hey, 50% company match on the first 6% should NOT be passed up. This is one thing I didn't have to understand anything about funds or stocks to know: DO NOT PASS UP (legitimate) FREE MONEY! You can think of it as a raise. Sure, your take home will be less now, but so will your taxes AND you'll have more later. Join the 401k? Duh!

So, I did some research on Morningstar, Google, and elsewhere finding what I could and looking at what I understood about each fund. (First, I had to figure out what the real names of the funds were, as everything in the packet began with "John Hancock" but nothing in the listings did.)

The first three choices were easy, because they were made for us. I know, I know, everything you read says learn and make your OWN choices - but here's why we didn't. We received a Christmas gift of an initial contribution into a Roth IRA through a brokerage/financial planning firm. When that happens, you don't say "Oh thanks, but you know, I'm going to just do my own thing instead, ok?" So for now, we're keeping our IRAs with Remick & Bartolet until I'm confident enough in my investment understanding to say "let's fly solo!"

Our first investment, NSBRX, was half our choice. We told R&B that we wanted to put our money somewhere socially responsible. They, then, found a good fund with this mission. You have to be a paying member of Morningstar to get all the dirt on this fund, but kindly, Google has the vital information for free. Then, R&B chose http://www.google.com/finance?q=CVGRX&hl=en and AEGFX for us - for diversification. OK, so our IRA's hold one socially responsible Large Blend fund, one mid-cap fund, and one foreign large blend fund. Not a bad start. Funny enough, AEGFX showed up in our list of options for the 401k.

One reason I didn't choose one of the "Lifestyle Funds" (pre-packaged portfolios) offered was that it wouldn't take into account the holdings in our IRAs. The other, bigger reason was that I'm not interested in paying an additional fee.

Ok, I think I'll post my reasoning for other choices later, on a new post. If any money/portfolio savvy readers out there have advice you'd like to scream at me ("What is she thinking?") comment away.

Wahoo.

Google Spreadsheet

2006-06-11T00:22:00.000-07:00

I've been trying to find somewhere I can post our current budgeting spreadsheet online for you to view. (Of course, I'd likely change our actual numbers for privacy reason once the spreadsheet goes public.)

Unfortunately, I've been unable to do so.

I have, however, begun the laborious process of translating it onto Google's new spreadsheet. (They don't yet support uploads from OpenOffice.)

Review - YF&B

2006-06-10T23:42:00.000-07:00

Ok, so I haven't finished reading it yet, but I got a big stack of Suze Orman books from the library, and I'm *not* reading through all of them, as there is a lot of overlap.

I'm currently browsing "The Money Book for the Young Fabulous and Broke."
fun title, eh? So obviously marketed toward, well, the Young, Fabulous, and Broke! On the cover, Suze is sporting an upturned collar, and the words are all different sizes and colors. Inside the book you'll see "pop-ups" and "quick-tips" and she's set a lot of it up in Q&A format. She also writes in a very conversational tone: "OK, Listen up. I'm serious here. Don't shut your brain off or let your eyes glaze over."

Sorry, I've simply babbled descriptives and actually reviewed nothing, so far. She throws some very surprising advice out, relative to others giving advice (use credit cards, or at least don't totally cancel them when you cut them up). But one surprising thing she said popped out at me in a way that really made me want to mention it on a review...

She says NOT to use a budget. She compares budgeting to dieting. You try it, and you never really stick with it, you just end up gaining your weight back.

In a way, she is right. I tried budgeting. I tried hanging on to all my receipts. I tried having a set time I would go and review, comparing my what I had planned to spend with what I actually did spend and it NEVER worked.

But "All Your Worth" tricked me into using a budget! How? Because it wasn't like any budget that had ever been sent my way. It was just simply, balance. Everywhere I'm reading says to set goals. I made a rather silly dig on that when reviewing the MASSPIRG budget deal, but in reality I do have goals. My goals, however, did not stem from "I want $[insert amount here] to get [object]." Instead, they are percentages. I have a goal of my Must Haves = 50%, my Savings = 30%, and my Fun Money (aka Flexible/Variables) = 20%.

Starting here led me very gradually toward actually using a real budget and setting more concrete goals. But I don't hang on to receipts and look at things with hindsight. "I planned to spend blah, I did spend deblah." Instead, I go - "Ooo, I want to get that 50% off cute baby outfit for my pregnant friend, but how much do I have saved up in my fun money right now? Is it worth it to get that, or do I need to save more because I plan on driving all the way out to Idaho to visit that baby?"

So I think the moral of the story is this: jumping head first into budgeting may not actually work. Thinking you're going to live your life following the Atkins Diet probably won't work either. Instead, make it a Lifestyle (yes, with a capitol L). Is your money lifestyle penny-pinching, or charging everything? Is it fresh veggies, or Big Macs? Who knows, if you start eating fresh veggies, it could lead to eating whole grains and even growing your own garden - which would save you more physically AND financially. I love it when things come together like that!

Drive By

2006-06-09T11:49:00.000-07:00

Monday I was downtown so Jasper could have a quick follow-up with the doctor (aka, yet another $20 copay). While in town, we finally deposited the "Change the Baby" jar. Since there were zero guesses on the amount, I guess Jasper gets to keep all $130.43 of it. It was a bit funny that we withdrew our weekly $120 directly after this deposit. Well, it would have been awkward to carry around a change jar while buying groceries.

Like we usually do when we're in town, we did a drive-by through Ladd's Addition to see the old apartment. Something that hasn't happened in years was happening at the old place... the landlord was there! We saw his pickup in the driveway, and he was opening the windows to our old bedroom. We considered stopping to confront the man face-to-face... "where's our money!?" but since Erik had to be at work in just a few minutes, we decided to use that as an excuse an chicken our way out of there.

The next day, the check came in the mail. $600 with a short, handwritten note saying, "The contract said $100 was cleaning fee, but you left it in such great shape so here's the entire $550, plus $50 for your troubles." Not double, but not court either, so that made us both happy. I instantly put $500 toward my loan, and divvied up the remaining $100 for fun options. I would have put it toward our IRA's, but we're planning on traveling to Germany in September... If we have money left over from our trip budget, we can decide then if we'll invest it, or keep a travel budget for other, smaller trips.

Investing Classes

2006-05-31T13:26:00.000-07:00

I found free investing classes online on Morningstar's website. This is perfect for me right now. The lessons are short enough that I can do them during Jasper's naps, while I'm tired and sitting in bed next to him. Yet, they're informative enough that I'm learning. Best of all they're free!

I've finished the entire 100 level on funds, and am just beginning the 100 level on stocks.

The more I learn and read, the more I want to invest on my own... especially since I'm a bit frustrated by the managers of our IRA's right now. They haven't returned my phone calls, and I have to wait forever before I can even deposit any money into our accounts. Everywhere else we have our money, I can go online and "presto" it's where I want it to be.

Yesterday's Money

2006-05-31T13:10:00.000-07:00

Yesterday, I had an eye exam at 3:30, and dropped Erik off at the Max station close to 11:30. I decided to kill the four intervening hours by very slowly running errands, instead of driving home and back out to town again.

I brought Jasper's Money Jar with me so I could deposit those coins and get started in on saving for him. Unfortunately, not all credit unions are created equal. At some, you can deposit your money into your account at another credit union. Although the nearest CU had a change machine that would count it all free of charge, they did not do deposits into other institutions - so no luck there. The nearest branch of the credit union we belong to is their only branch without a change machine. So, I'll have to wait until I'm downtown again to deposit anything. That won't be until next Monday. Hopefully the change jar doesn't get stolen between now and then. I forgot to take it out of the car yesterday - and it's parked at a Max parking lot today...

More adventures in money-land yesterday, the ever exciting cliff-hangers of the insurance industry. Financially speaking, the exam went as expected: nothing but a $10 copay. However, the same did not hold true for the lenses and frames. The girl at the glasses store could not tell me exactly what insurance covered, or even the parameters to work in even after speaking to our insurance reps. The best we could do was pick out a pair, enter a claim, and enter it to see the charges. They ended up wanting $150 or so for the pair we picked out and I said, no way! I want the 100% coverage (minus $10 copay) my insurance claims to give. It should say somewhere on the info they gave us what their "allowables" are. Other than listing covered places, no luck.

So, for now, my vision has been checked - a new prescription is sitting in my wallet, but I'm still driving nervously fuzzy-eyed.

Review - 9 Steps to Financial Freedom

2006-05-28T19:09:00.000-07:00

9 Steps to Financial Freedom by Suze Orman. Read it. Especially Ch. 3.
This book actually did have something different to say than the other finance/budgeting books I've read so far, and I think it makes a great companion book to "All Your Worth." AYW is a good guide for specifics on how to set up a budget, and balance, deal with emergencies, etc. This book dwells more on different aspects, but really compliments the whole idea.

She begins very much the same way "7 Stages" did, by asking you to look at the money messages you tell yourself based on childhood experiences. But, she doesn't get as hippy-dippy about it and moves on quickly to more practical advice.

Chapter three, which is all about "taking care of those you love" (as she puts it), is how this book was referred to me in the first place. I knew we need to get a will put together, and I finally found a notebook with advice on the subject I had been given several years ago. This book was in the list of recommended readings.

If you are married, if you have kids, if you have any money or debt and there is ANY possibility that you will die (oh, hey, that means ALL of us!) than chapter three of this book should convince you that putting together your will, revocable living trust, and an advance directive with power of attorney for health care should be a top priority if you haven't done it yet.

Another thing that I REALLY like about this book is that she tells you to trust yourself. She give some tips for experimenting, getting started with investing on your own, and then also gives advice for how to find professional help if you're still to nervous to do it on your own. She makes great arguments for why brokers probably won't be any better than you will be with handling your investments.

I currently have a stack of Suze Orman books from the library. I am going to follow her advice (and am already following some of it). I'm going to set up a trust for Erik and I... our net worth is currently very small - but at the aggressive rate we're saving, it should eventually grow to a healthy sum. I don't want Erik, Jasper, Myself, or any of the rest of our family left with unneeded expenses and worries should any of us pass away. I'm going to continue to save aggressively, and begin to invest independently.

There were some parts of the book that made me giggle. She certainly dates herself whenever she mentions the World Wide Web or America Online. :)

I have work to do!

Review - Seven Stages of Money Maturity

2006-05-27T14:10:00.000-07:00

Here it is, my review for "Seven Stages of Money Maturity" by George Kinder.
Well I did the exercises, etc., and didn't really get much out of them. Most of the book was a bit too froofy for my taste, talking about "money chakras" and such. Chapter 11 probably had some very useful information in it, but by the time I got there I was so mentally bored by the lack of anything substantial in the previous chapters that I couldn't retain any of it. It was time to return it to the library anyway.
In short, don't waste your time with this book.

Oh, funny! Erik put in a random CD - and the song that just started spinnin': "I want Money!" Oh yeah. "The best things in life are free, but you can give them to the birds and bees... I want money."
Ok, it's over now. Now it's "Leader of the Pack."

Letters from Insurance

2006-05-25T17:56:00.000-07:00

Remember the letter we got from our insurance denying the claim because we did not provide information they requested? Remember how they had never even requested information from us?

Well, we got the request yesterday. A package came with a separate letter for every single bit of care regarding Jasper's birth. Each letter said the exact same thing. "Please send us the physician's name and tax id number." Funny that we gave them all the info before the birth ever happened. Funnier still have that info was right there on the explanation of benefits they sent us earlier.

Erik took the requests, plus all the denied claims, and the two letters we have saying they would pay 100%, to work today. He gets to call them AGAIN, and battle once again.
I hope we don't have to go as far as court in this fight.

Eye Care Coverage

2006-05-25T17:51:00.000-07:00

We pay $10/month for vision care. It includes an eye exam once a year, lenses for glasses once a year, frames every two years, and a deductible on contacts.

There's a $10 copay for the exam and $10 copay for ordering vision-wear.

Is this a good deal? Or is America's Best better?

I have an eye appointment on Tuesday. I haven't updated my vision wear in 10 years!

Seven Stages Suggests:

2006-05-24T13:03:00.000-07:00

To educate yourself of several ways of financial thinking:

Barron's
Business Week
Forbes
Fortune
Investor's Business Daily
Journal of the American Association of Individual Investors
The Economist
The Wall Street Journal
Worth
FinanCenter, Inc.
Morningstar Mutual Funds
Securities and Exchange Commission
Value Line

Cost of Health - Two Letters

2006-05-23T16:42:00.000-07:00

Two letters came in the mail yesterday. The first was from OHSU:

"This is NOT a bill"

The visit summary for Jasper's hospitalization looks like this:
Lab - $42
Other Diagnostic svc - $23.70
OR Services - $3,419.50
Pharmacy - $159.84
Room Charges - $2,164.00
Supplies - $830.71

Total Charges - $6,639.75
Please note: OHSU Medical Group will bill you separately on behalf of your physicians.

Now we sit tight and see if the $20 copay is truly all we have to pay...

The second letter made our blood boil:

"Dear Erik Lane,
Patient: Amber. Date of Service: 3/3/06 [Jasper's Birth]
To process your medical claim, we had previously requested additional information from you and/or your health care provider. Unfortunately, we did not receive a response, and as a result your claim has been denied."

This is the third letter denying any claims regarding Jasper's birth. Every one has been for a different asinine reason, like the patient was the wrong gender. (They billed under Jasper's name instead of mine.) This is SO ridiculous! Erik spent HOURS dealing with the insurance company BEFORE Jasper's birth to ensure its coverage, and we have two letters in writing saying they will cover it with in-network benefits. Now, we're fighting the exact same fight all over again.

The insurance company says the information they requested, but never received was the name and tax id of the physicians at the birth. Funny how that exact information was already listed on the summary of benefits they sent us! Growl.

Big Bucks, And Then...III

2006-05-23T16:36:00.000-07:00

Continued pg. 158

"Again you've gone to the doctor, but this time you learn you'll be dead within twenty-four hours. The question isn't what you would do with the little time you have. Instead, ask yourself, "What feelings am I experiencing? What regrets, what longings, what deep and now-unfulfilled dreams? What do I wish I had completed, been, had, done in this life that is just about to end?"

I feel rushed... Lots to do in little time (mostly call to loved ones).
I honestly can't come up with any regrets...
I at least got to be a mom for a little season.
I'm sad that Erik and Jazz will have to go on without me.

Big Bucks, And Then...II

2006-05-23T16:30:00.000-07:00

"Seven Stages" cont. pg. 156

"You've just come back from a visit to the doctor who has discovered from your lab reports that you have only five to ten years to live. In a way you're lucky. This particular disease has no manifestations, so you won't feel sick. The bad part is that you will have no warning about the moment of your death. It will simply come upon you in an unpredictable instant, sudden and final.

Let the emotional import of the situation sink in, then address yourself to this interwoven question: "Knowing death is waiting for you sooner than you expected, how will you change your life? And what will you do in the uncertain but substantial period you have remaining?"

I would work even faster and harder than I have been on getting "death business" in order, trusts, wills, etc.
I would make sure to visit family as often as possible.
I would have to sit down with Erik and seriously ponder weather we should have more children, and how soon we should try.
I would finish my picture book.
I would go dancing more often.
That's all I can really come up with.

Apartment Deposits

2006-05-23T16:14:00.000-07:00

I've had very bad luck getting security deposits back from places I've lived. (Move out due to sewage raining from the kitchen ceiling - that ended with legal action, change of landlord's mid-lease, etc.) I'm actually a very good tenant, so this time when there were finally no hitches to the reason I moved out - I'm really miffed that we still haven't received our deposit. It's been 52 days since "official" move-out, and still no word from the ex-landlord.

I just finished looking into landlord/tenant rights, and how to go about filing a suit with small claims court to get our deposit back. I found a letter on the Oregon State Bar's website to send warning my landlord, "Yo, gimmie my moulah back!" I'll mail it out tomorrow.

The good news is, under Oregon law, I'm now entitled to TWICE the amount wrongfully withheld. The questions is, what should we do with all the extra money once it's here? Options are: Use it all toward my loan, Contribute to our IRA's, Contribute to the 529 account we will soon have, Use some for play/Germany money, or put it toward our "dreams" savings. Of course any combination of the above is not out of the question.

Big Bucks, And Then...

2006-05-23T12:12:00.000-07:00

From "Seven Stages of Money Maturity" pg. 154...

"You may not be as wealthy as Bill Gates or the Sultan of Brunei, but you do have all the money you need, now and in the future. What will you do with it? From this moment forward, how will you live your life?"

I'm not sure how Erik would answer this, but I'll play for now.

I would set up a trust fund to ensure that although I have all the money I *need*, I would still have extra for helping my loved ones, and having some extra money I'd *want* to play with.
Completely pay off my debts (read Student Loan).
I would then either directly pay off the debts of those close to me, or would at least help in whatever way seems best - either loaning them $ to pay off high interest loans, or giving them money and setting them up with a financial planner to help them help themselves out of debt.
I would pay for a good lawyer for my sis-in-law.
I would pay for my in-laws to makeover their home the way they'd like it... or at the very least pay for the new deck and replace the broken window.
Buy farmland and get going gung-ho. Plant an edible forest, and also have land to grow for perhaps selling at farmer's markets - or setting up a restaurant like the One World Cafe.
Create a Game Space, for indoor and outdoor adventures.
Build our dream home - green house/home.
Begin the arts mentoring program I'd like to set up, or at the very least donate lots to WRAP, P:Ear, and other groups with similar missions.
Travel! All Over the place. Visit new fun places, family, and more. Maybe I would even set up a family travel fund, so that my entire family could get together once ever few years, fully paid for.
Send Jasper to Waldorf School.
Learn a martial art.
Buy a Grand Piano and begin taking lessons again.
Better yet, create a music studio, with all the recording equipment. I could even rent it out for real cheap to people.
Get a sail boat.
Hmmm... I can't think of much else I would do.
Take classes, learn more. Ballet, Yoga, Law, Nursing, Herbs, Reiki, Medicine, Financial Planning and Investing, Gourmet Cooking, Waldorf Education, Psychology, etc.
Perhaps set up some sort of entrepreneur fund to invest in new products or projects that intrigue me.

Current Reading, Future Project

2006-05-21T20:52:00.000-07:00

I'm currently reading "The Seven Stages of Money Maturity" by George Kinder. In his section on "Innocence" (the first stage) he has an exercise, a list of questions to answer.

Well, the book is due at the library on Wednesday, and I doubt I'll get to finish it before then. So, I'm typing the list of questions so I can still play with the book once I return it.

Page 41 reads:

"Answering the questions that follow will help your understanding of how money messages have affected you financial life.

What are your three earliest memories of money?
When and how did money first enter your relationship with your mother? ...your father?
What is your first memory involving money and a close relative? A shopkeeper? A neighbor?
What were your family stories about money (e.g., about Grandpa losing the farm in the Depression, or the time Auntie Mae had to go on welfare)? Were these stories told with an air of approval or disapproval?
What did your mother have to say about money?... your father...?
Did you ever worry about money? What did you say to yourself when you were worrying?
What are all the one-sentence lessons you learned about money while growing up? Who spoke each of these lessons? Which ideas did you accept? Which did you reject?
What were your first money experiences with cars, homes, insurance, stocks, bonds, lawyers, brokers or financial planners, legal papers, and banks? What messages did you carry out of these experiences? Do you respond to the same messages today?

...
How have your beliefs about money hurt your life and cause suffering?
How do you still make choices based on beliefs right now, at this very moment? List the ways. Do you continue to want to live by these messages?"

Ok, list done. Now to continue reading as much as I can get done before the book must be returned.

Keep Guessing...

2006-05-20T12:25:00.000-07:00

I counted. Erik was about $10 off on his guess...
Whats your guess?

So Much to Learn...

2006-05-19T13:33:00.000-07:00

Whoa! And you can practice and everything.
I think I'd need to learn more before I can even begin practicing. I watched the tutorial and kinda sat there stupidly drooling. "Trading for Dummies," anyone?

Change Jar

2006-05-19T11:51:00.000-07:00

Erik and I have saved all our coins in our "Change The Baby" jar since August. I'm going to count the change today (if Jasper gives me enough time). Can you guess how much money is in the jar? Remember, we've been using mostly cash for all our fun and groceries.

529 plans

2006-05-17T21:44:00.000-07:00

Should we?

College gets more expensive ALL the time. We could plan and contribute quite a bit to Jasper's college education, and he could still begin his adult life with a load of student debt.

He may not even want to go to college. Would we offer him some money to follow other routes?

529 college savings plans are tax deductible up to $2,000 per couple per year. That would be nice.

It's tax free when you use it for college related expenses.

We, as parents, retain control over the account. And, we can change who it's for.

We *WILL* have to pay taxes if we withdraw the money and use it for non-college related things.

The Oregon College Savings Plan gets the highest rating in Oregon from BankRate.com.

The initial contribution is $250. I'm pretty sure that's more than we currently have in the change jar for Jasper. Then, there's a minimum monthly contribution of $25 a month. So, that's a minimum $300/year contributions. Over 17 years, that's a little over $5,000 for college. That doesn't include ANY gains - strictly contributions.

There's a .2% yearly management fee, and the $20 yearly fee is waived for Oregon residence.

Given college costs continue to rise, factor in inflation, I'm guessing that would be about equal to the almost $1,000 my parents pitched in for my college expenses.

Can we afford to do this, putting an extra $25/month in our "can't touch it now" money pool?

I like the tax benefits, the control, and the incentive to go to college that offering to pitch in some would create.

But I'm still undecided.

What do you think?

4.75% Hurray!

2006-05-11T14:41:00.000-07:00

We finally have money growing in our Money Market account at GMAC bank.
Now we just have to figure out what's going on with our online account, as we can't really get into it right now...

4.75 is the best money market rate we were able to find. Much better than our regular savings account.

Cost of Health

2006-05-03T20:24:00.000-07:00

We currently have great insurance, and after spending 2 days in the hospital, with our baby son going through surgery, we are very thankful. We are optimistically expecting this entire ordeal to cost us nothing more (Out-Of-Pocket) than the $20 copay we've already shelled out.

Through Erik's work, we pay $1420/year for insurance for Erik, Jasper and me.
Right now, on average we also spend about $50/month in addition out of pocket medical expenses. This includes prescriptions, over-the-counter meds, and copays.

If we did not have the benefits of Erik's job, healthcare costs would blow us out of the water. This is probably the #1 thing that would keep us from working for ourselves full-time, farming and whatnot.

Story Problem

2006-04-30T10:33:00.000-07:00

Amber has a student loan she is repaying.

To pay it off in three years, she'll have to pay $263.24 a month and $366.56 will be the interest.
To pay it off in two years, she'll have to pay $389.62 a month and $251.92 will be the interest.
To pay it off in one year, she'll have to pay $769.16 a month and $129.91 will be the interest.

What is her current balnce and interest rate?

LFG.com

2006-04-27T19:48:00.000-07:00

A commercial told me to go to lfg.com and I said ok. (Yup, there is a tv in my life again.) I liked the website. The Lincoln Financial Group's website has easy to find information, financial education for teens, a quiz for how in need of financial planning you are, just all around useful stuff.

I, apparently, am in relatively high need of planning. I agree with the quiz, actually. The good news is I AM currently saving for retirement, and Erik does have disability insurance. I (we) still need to come up with an actual plan (although we do have vision), need to decide what we'll do in terms of college (or other) savings for Jasper, need to write a simple will and a living will...

We'll share our progress as it happens.
Where do you stand as far as planning for your financial future? Perhaps LFG will help you.

Ingenuity

2006-04-27T11:23:00.000-07:00

This guy gets it.

In "Rich Dad, Poor Dad" there is a lot of talk about how creativity, ingenuity, marketing, and a little bit of greed will get you far.

In 9th or 10th grade, I threw a "bigger or better" party. We all started out with a nickel, and had one hour to run from place to place asking to make trades for something bigger or better. By the end of the hour we had a blender, a desk, and even a boat. But I stopped there, it was just a game. I never thought of setting an end goal for what I'd want to end up with, or being selective about the trades. I just wanted to see who could end up with the biggest and best thing. I forgot all about it until recently Mandy posted a link about this guy.

He's gonna do it, too. He'll end up with a house (and a lot of adventure along the way) beginning with just one red paperclip. He's definitely got marketing down. He's being selective in his trades. He seems like a genuine nice guy, with a little bit of greed that will get him far.

I personally don't think his last trade was a trade UP, (a year of free rent in Phoenix for a day with Alice Cooper) but with this guy's charisma and now popularity, he'll end up with his house.

Oh, and I almost forgot to mention. He's encouraging copy-cats. Hurray for sharing!

What would you trade for a paper clip?

Review - PIRGIM's "Master Your Money"

2006-04-25T18:11:00.000-07:00

Randi said we should check out PIRGIM's "Master Your Money" report. So, I did and I may as well review it.

It's fine if you're struggling, and know nothing about money, I'd say. A few things seem either unrealistic or irrelevant:

First, the talk about not being able to afford a bank account. All my life I've had a free account, usually through a credit union. Washington Mutual also offers free checking accounts. It's pretty easy to get an account that has a minimum balance of $0 or $5, with no fees except for overdraft. So I found that part a little over-blown.
Also, it does the usual "group your spendings into categories" in a much more detailed than needed way. I much prefer the "All Your Worth" method of just three categories: Must-Haves, Wants, and Savings. Admittedly, we do have several categories in our own budget, but they're a bit broader than movies, eating out and clothes. (i.e. Fun Money, Car stuff, Loans, Out-Of-Pocket medical expenses, etc.)
The problem with setting a very specific goal for a specific thing is two-fold: What do you do when you reach it (continue to do well, or fall back into a not-so-good pattern) or how bad do you feel about yourself when you just can't seem to reach it. If your goal is to spend no more than 50% of your income on must-haves, and save at least 20%, than you have an ongoing goal that you can reach easily.
Having a spending plan that is "part of your daily routine" seems like it takes more time than should be necessary. Better to set it up in a way where you *don't* have to think about it. (Ok, so I'm totally sold on the "All Your Worth" method, and it looks like I ain't budging.)

The biggest things that were unrealistic were this:
*Using 5% or more interest as an example of how much money you earn through savings. If you know where I can earn 5% having a little extra set aside, PLEASE give me a link to it.
*The ways to save money. Who takes the family to the movies WEEKLY? Who takes that many family fast food trips? Who eats lunch out EVERY DAY?

Ok, enough complaining. Here's what was good:
Most of it was the same common sense budgeting advice you hear everywhere, and it's good advice. Fortunately, most of it doesn't apply to our situation at all. (High CC interest rates, payday loans, etc. etc.)
Get your free annual credit report here.
Go here for debt advice.
For help buying a house in Michigan, go here.
To stop junk mail credit card offers call 1-800-OPTOUT or go here.
To stop telemarketers go here or call 888-382-1222.

Don't get me wrong. Overall, I love PIRG and with work they do (worked with them for a year and a half), but I found most of the report useless; at least for us.

Review - The Number

2006-04-24T13:07:00.000-07:00

Lee Eisenberg is snippy and sarcastic, especially at the beginning of "The Number." So much so that Erik was put off by it and didn't read much. I did keep going, and as the book went on, the book provided more substance and more tollerable wit.

The number is much more of an exploratory essay than anything, so don't look to it for financial advice. Eisenberg asks how much money do we really need to retire, and what's retirement all about, anyway?

I ended up enjoying the book by the time it was over, but I wouldn't add it to my must-read list.

Money Education

2006-04-21T12:36:00.000-07:00

"Rich Dad Poor Dad" dwells on the fact that rich families teach their children about financial management, and middle-class families don't, or at least what people learn in the home about money is usually the wrong mindset. One example is whether your home is an asset, or a liability - which I already mentioned. Another is, in his words, most people work for money, and the rich have money work for them.

I began thinking about what I learned about money growing up. I don't recall ever sitting down and learning about money management or finances at home - but there were things my parents taught by example, most of which I only understand now - looking back.

My parents were both school teachers, which meant not a large income, and no income in the summer. We spent our summers traveling and camping, so they obviously saved some money for this purpose. My mom did the budgeting, at her desk in the middle of the kitchen, where bills went in slots and cash came out of an envelope. (Looks to me like she did envelope budgeting.) I did ask her about it once, and she told me she just knows how much cash to get out each week, and once its gone its gone. Now that I'm using the same method, I can see why she did it. Early in my life, they bought some beautiful property in north-central Idaho with the plan to move there when they retired, and we would travel there for vacations frequently. My Dad would also work one week of the summer at "The Festival of the American West" at USU. This obviously wasn't necessary for income, as he quit doing it when it was no longer fun, but it did bring in some spending money while he was doing it.
When we (the kids) got old enough to get a summer job, we quit traveling with the family as much. One such summer, I was put in charge of the bills. My name went on my parents account, and my mother showed me how she does the bills. It was pretty easy, really. Pay tithing first (I was raised LDS, which meant 10% of our family's income voluntarily went to the church), then round it up to the nearest whole dollar and give the difference in other offerings (humanitarian or missionary funds, etc.), then pay the bills. I was left an envelope of cash to get groceries from. I remember my little sister wanting me to order pizza with it, and feeling very responsible when I said no because we needed to make sure we didn't run out of cash. She thought that was silly, since I had access to mom and dad's account, I could always get more. (Sorry, Linds, to confess for you.) I guess that's why I was given responsibility for the bills and not her, huh?
Anyway, I remember hearing Mom mention a Money Market account, and when I asked her what it was, she said it was where they keep the money they used to live on in the summer time.
There are two other vivid memories regarding money that have stuck with me. One was that I was never told no when I wanted something from the store. "Sure you can have it," I was told, "If you earn the money for it." We were not lavished in material possessions, but we were given opportunities to earn money if we wanted it. I frequently washed windows or mowed the lawn to earn money. For a long while, I owned the only CD Player in the house because I earned the money for it. I still own and use the same player today, and I purchased it while I was in middle school!
The next memory, rides on the exact same principle, only with different incentives. "If you want to go to college, you'll have to get good grades and get scholarships, because we're not paying your way." You can have it, if you earn the money. Education WAS highly valued, and we WERE expected to go to college, and therefore were expected to get good grades. There was a little help for each of us; $1000 (or was it $3000 - I'm not positive) was put into a mutual fund for each of us that we could cash out when we needed it. I took mine out for college, but stocks were in a slump, so I ended up with less than that. Also, due to skyrocketing college costs, the money went a lot further for my sister 10 years older than I than it did for me. One reason the older siblings left school debt free, and the younger ones didn't. (I'm not upset about this in any way, it's just what happened.)

So, I knew my parents did the following:
*Pay bills on time
*Plan ahead (for summer)
*Plan REALLY ahead (for retirement), including having dreams and not just financial goals
*Believed in the value of tithes and offerings
*Invested in Money Market accounts and Mutual Funds
*Didn't spend beyond their means
*Oh yes, and they had their home all paid for before they moved.
All really good stuff. The ONLY one we ever really sat down and discussed, to my memory, was tithing. Religious was primo important in our house.

So, I learned good middle-class examples. What I didn't learn in all this was HOW.
It wasn't until a budgeting workshop in college that I asked my mom HOW she did it (the cash in the envelope).
I had no idea what a Money Market was, or why,if,how,etc I should get one.
I knew Mutual Funds could lose you money, or gain it, but that's about it.
I never knew how to plan for retirement, or buy a home.

So, in the world of middle-class, live within your means, I've got it. No Problem.
In terms of future planning and investing, I knew squat, and am only learning now.
In "The Two Income Trap" and "All Your Worth" they argue how that was fine for our parents generation. They'll get along fine this way. But the rules have changes, and debt now chases after us screaming "Hey! You NEED me!" We have to be even smarter than they were about our dollars and cents, they say.

So, I'm curious:
HOW do you teach your family about financial management?
What did YOU learn growing up?

My program

2006-04-21T00:36:00.000-07:00

Yes, I'm making a budgeting program to do just what we want it to. And when I'm done if anyone else thinks that it might help them out they're welcome to try it out, too. I'll make no promises about when it will be ready, or even that it will do what you want it to. But I'll try to make it as good as I can. I'm also using it as a learning process, so it might be a while. Sometimes I feel like I'm beating my head against a wall as I teach myself to program it, and other times it just flies. It is reassuring when I think that if I was in school learning it I would be going WAY slower and wouldn't be learning as much. Heck, I've only been at this for a little while now and I'm already creating a program to do just what we want.

Of course, what with how much of my time I'll spend writing the thing it might not save us any time in the long run. But I justify it because I'm using it to learn and I'm enjoying that immensely! I also know that if I get it right then it could help other people also. I know my sister Denise uses the spreadsheet that we do and would be interested, for one.

I first looked at the programs that were out there, and nothing seems just right. Once we started doing this spreadsheet, which plans ahead instead of keeping track only where money went after the fact, we fell in love with it. It makes so much more sense to have it planned out ahead instead of keeping every receipt. It's less work and then you don't have to be as careful about every little thing. You have the cash every week for out of pocket stuff, and once it's gone you're done, simple as that. There are also amounts you set aside for various bills and rainy day funds. (We have one that's car repairs.) So that way the money is already there and when you need it you spend it, knowing that that is what it was for.

When I was looking at different programs I found that they call it the "envelope method" and when cash was more prevalent rather than cards plenty of people would literally use envelopes with cash inside. I found many programs that would do this or that part of what I wanted, but nothing that would do it all. This is a good one.

This one also sounds at least somewhat good, except that to use it you need to pay a monthly fee. No thanks.

Here's another that sounds good, but when I tried to use it I found it klunky.

And, finally, the one that I liked the best, but it still lacks quite a few features that I would like. So I'm making my own. That goes to the Mac version, which is more up to date than the Windows one.

Here's a good page with links to all kinds of them.

Update: Here's an online free one that might be decent. I haven't had a chance to play with it very much. I'm hoping that Amber will have a chance to see how good it really is.

Work Ideas for Amber

2006-04-20T13:20:00.000-07:00

I used to teach piano, but I've never been to keen on the idea of doing it once I have a family because then my working hours would be at the same time as my school-aged children's at-home hours. Last night, while reading "The Number," a book about retirement, I had a great idea. What if I offered adult beginning piano lessons to retirement communities - aka "Active Adult communities?" Then, I could work during school hours, set my own schedule, use my piano skills, my teaching skills, get to work with beginners (which I love to do), and fill a unique niche. I *like* it!

The only problem is, however, this would have to wait until my kids were in school. For now, I just have one newborn - so this idea is several years away.

I did have another idea that could get going soon, though. Even more than teaching piano, I would LOVE to teach composition. I realized last night how easy it would be to offer composition instruction online - targeting home-schooled kids. I would just have to set up a website - it would really be a piece of cake. And, the costs of running a website would be far less than renting a studio to teach in, or traveling to people's homes.

Finally, I really should finish my book. I began writing a picture book story a few years back, and I'm still really sold on the concept I have going - but it still needs a lot of work. It would take money up-front to commission an illustrator (I have one I'd like, but the art won't happen until there's financial incentive), and to market the book - but once it's done it could be a money maker. I know the idea of the story is good enough to sell - it's all a matter of me having the discipline to get it done.

Review - Rich Dad, Poor Dad

2006-04-20T12:04:00.000-07:00

"Rich Dad, Poor Dad" by Robert Kiyosaki is a great read, even if it is poorly written. It reads just like a motivational speech, where the excited cheering speaker repeats himself often - really driving his point home. He even uses his lack of great writing ability as an example in the book! (He may not write well, but his marketing skills got him a #1 NYT Bestseller.)

I enjoy his argument that we need to choose to be rich. I've always been of the mindset that I would be poor (financially) throughout my life. I am/want to be a stay at home mom, and enjoy working in the non-profit world and the arts... not big money in those industries. But he makes a good argument that those who see any problem with the idea of a desire to be rich are simply being mentally lazy... they're really just afraid to try. He even goes so far as to argue that being greedy can be a good thing, and he manages to do it in a completely inoffensive way.

One surprising argument he makes (that fits very well with the "All Your Worth" philosophy) is that your home is actually your biggest liability, not your biggest asset. (Your brain - and using it - is your biggest asset.) The reason he argues is that assets contribute to your cashflow, and liabilities detract from it. A home takes mortgage payments, utility bills, repairs, etc., but doesn't bring cash in. (Unless, maybe you have a reverse mortgage.) Owning rentals, buying and selling real estate, these are assets.

Kiyosaki has even created a game to teach his way of handling money, and how can you not like that? We have yet to play it, but likely will one day.

The book is not a financial planner. Like I said, it's more motivational than anything, but it's an enjoyable and easy read with some fascinating ideas.

Java - it isn't a Latte

2006-04-20T11:46:00.000-07:00

Erik has an awesome project he's working on. Maybe he'll want to post about it, but most of his computer time has been used working on it, so I'm posting just in case he doesn't have time to get around to it.

He loves learning about computers, especially programming. He also loves learning on his own through books. Classes can be nice, but then you don't get to work on your own schedule at your own pace, and you have to pay someone extra to tell you what to do. So, he's been getting books from the library to study up on programming languages - with his current focus on Java. Unfortunately, most library books are a bit outdated - but this way he can find the series or publisher that's most helpful, and then buy the most up-to-date book of that kind. Buying a book = less than buying a class. (So far, he's only purchased one - though the library piles continue to stack high.)

Also, knowledge is our greatest asset (I still need to post a "Rich Dad, Poor Dad" review, don't I!) and the more of this kind of stuff Erik knows, the more options he has in the job market. (Being able to fix just about anything is a pretty good asset too, both job market wise and money savings around the house.)

Anyway, he's begun creating something that might be pretty complicated for his first Java program, but it will be beautifully worth it. He's making our very own personalized budgeting program. He's taking concepts from the spreadsheet we began using (although we've really modified it) and planning to make everything much more automated. This is to save me time when I sit down and look at our money once a week. (Although, I don't mind the time I spend - I think it's fun, really.)

It may be a long time before it's done, but once it is, we'll have our own little online launch party.

Web Resources for "All Your Worth" Budget

2006-04-19T15:38:00.000-07:00

Here is a website that has it's own details about "All Your Worth" style money management.

http://www.mdmproofing.com/iym/BMF.shtml

We downloaded the spreadsheet at the bottom of the page, and then personalized it to fit our own bank accounts.

Balancing Act, "All Your Worth" Style

2006-04-18T20:50:00.000-07:00

The book suggests having your money in the following balance:
50% toward your Must-Haves (home, food, insurance, etc.)
20% savings (details to follow)
30% fun
*This is almost exactly where we're at in our own balance right now.

FUN
They have great arguments for budgeting for fun money. First, the financially wise argument: it's a safety net. If (heaven forbid) someone loses their job or can't work for some reason, if things get tight for any reason, you actually have some spending you can do without! But also important, if you can't have fun, what's the point to begin with? They also recommend a shared income household to "divide and conquer." Each of you gets money that is your own to do whatever you want with, no questions asked. For us, this means Erik can buy video games guilt free - and while I was working, I could go out to lunch frequently, financially guilt free. (Health-guilt may be a different story.) We've actually been trying to do only 20% fun money and it's been working out well. We've even reached our savings goal for a trip to Germany! (goal=$2500. Do you think we'll need more?)

MUST HAVES
Don't get monthly must-haves that you don't really need. In other words, avoid financial commitment for things like health club memberships (pay as you go), cell phone contracts (pre-pay), or credit card bills (use cash). Shop for better insurance rates frequently, and don't get insurance you don't need, don't spend more than you can afford on housing. That covers it.

SAVINGS
A clear saving plan that makes sense is outlined.
First, have $1,000 extra just sitting in your checking account. It's there for emergency readily available money, and so that you never bounce a check.
Next, pay off what they call "steal from tomorrow" debts. These include credit cards, friend or family loans, back payments, medical bills, etc. They give all sorts of reasons why it's better not to have a debt than to have the money sitting in savings. I never figured out if student loans count as "steal from tomorrow" debts, because they seem to be "invest in tomorrow" debts - but I still sure would like to be 100% debt free.
Third, build a six month security fund. Save enough money to cover the cost of all your must haves for six months.
Once you're all secure, save for retirement (10%), pay off your home (5%), and save for your dreams (5%).

Well, we've done it. The first $1,000 was easy. We've paid off all of Erik's loans (higher interest rates than mine) and we're working on mine. We've built up our security fund, and consider ourselves on the fourth step... replacing paying off our home (we don't have one) with student loans payments. We're now going to put that fund into a higher yield money market account and let it grow... or at least maintain its value with inflation and all.

It's easy to do this "big picture" budgeting.

Review - All Your Worth

2006-04-18T19:21:00.000-07:00

So, now you've read "The Two Income Trap" and you're thinking, "Oh cussword, I'm stuck. This is totally my situation! What can I do?" Well, the authors (Elizabeth Warren and Amelia Warren Tyagi) were awful nice and answered your question in the book "All Your Worth: The Ultimate Lifetime Money Plan."

So, we've read "Smart Couples Finish Rich" and have heard all sorts of budgeting ideas. Neither of us really seemed to have the discipline to be that detail oriented with our money. It seemed more of a hassle than anything. And that silly advice of "don't buy designer lattes" didn't apply to us at all. Not only do I not drink coffee, I'm a rare breed who doesn't even like its smell. And by this time, we knew we had a baby on the way. Money was starting to become a big concern.

It may be safe to say that "All Your Worth" saved our financial lives. Now, we probably could have stayed afloat without it. In fact, I'm sure we would have managed.

I'll put it another way. Without this book, we would have been forced to move in with Erik's parents, and scrimp and save to know that we can get by on one income and without consumer debt.

After having read the book, we happily and willingly moved in with Erik's parents, we are comfortably saving, paying down our debts, have some money to play with (guilt free), and feel like we're doing well financially.

Here are some reasons I rave about this book:

It's the first financial management book that I felt applied to me. "You watch what you spend, you don't waste you're money on designer lattes, yet you're still just scraping by. Here's what you can do..." And it didn't skip straight to the usual "if you were smart and put $50,000 into a retirement plan you'll be wealthy" stuff the books always say. Sure, it said saving for retirement - and a rainy day - and for your dreams - is important... but nothing left you saying, "yeah right, and where do you think I'm gonna find $50,000 available to stock away where I can't get to it?"

It didn't expound on the virtues of owning a home. In fact, it said if you can't afford a home, don't buy one!

It DID say this: If you're struggling to get by, you're either spending too much on your must-haves or too much on your wants. It's all about balance. Then, they break down how to figure out which one you're doing, and several ways to fix the problem.

All the basic recommendations were easy to follow, and have put us where we are today - easily in the black. It's common sense simple, and takes the work out of budgeting.

I LOVE this book, and still claim it is the best financial planning book I've ever seen. A MUST read, and probably even a must own. (I took copious notes.)

Review - The Two Income Trap

2006-04-18T18:01:00.000-07:00

The next book in line from the "recommended by Mom" category was "The Two Income Trap: Why Middle-Class Mothers and Fathers are Going Broke" by Elizabeth Warren and Amelia Warren Tyagi.

The title gives the impression that you're in for yet another "the Mother's place is in the home" argument, but that's not really what you find at all. Instead, the book touches a little on the history of women going into the work force and why economic forces have made it close to impossible for the modern mother to stay at home. But that's not the heart of the matter.

It illustrates very clearly how easy it is to go broke, and why it's happening. The thing I found most fascinating was the history of the lending industry. It used to be you had to go to a bank, and prove you actually could afford a house before they would lend you the dough. Now, folks are getting hounded left and right to borrow money for everything - and the hardest hit are those who actually can't afford anything.

The authors do a great job of debunking common myths about why so many families are going bankrupt, like people are spending too much on frivolities, and they generally spend more on stuff (a TV for every room, etc.).

A quote from the Powell's review: "Today's two-income family earns 75% more money than its single-income counterpart of a generation ago, but actually has less discretionary income once their fixed monthly bills are paid... Warren and Tyagi provide convincing evidence that the culprit is not "overconsumption," as many critics have charged. Instead, they point to the ferocious bidding war for housing and education that has quietly engulfed America's suburbs. Stay-at-home mothers once provided a financial safety net if disaster struck; their move into the workforce has left today's families chillingly at risk. The authors show why the usual remedies - child-support enforcement, subsidized daycare, and higher salaries for women - won't solve the problem, and propose a set of innovative solutions, from rate caps on credit cards to open-access public schools, to restore security to the middle class."

Overall, I love this book and would rate it as one of my favorites. It delves into our social history, politics, and is an inspiring call to action. It also makes me feel even better about my old-fashioned commitment to be a stay at home mother.

Review - Smart Couples Finish Rich

2006-04-18T17:14:00.000-07:00

"Smart Couples Finish Rich" by David Bach was the starter book for us.
Erik's mom convinced him to read it, and then he convinced me.

I thought it was ok, and certainly important stuff to think about. I was unimpressed by the title, as I typically am with most financial books that make it sound like all you should care about is getting rich ("and this book tells you how").

Generally, I would recommend it. It's full of good advice. What I didn't like about it was David Bach's "I'm going to tell you something amazing that you've never heard before" tone. In fact, it was almost all stuff I'd heard before. (Esp. "Don't buy designer Lattes.")

Click here for Bach's "Finish Rich" website.

What's this all about?

2006-04-18T15:59:00.000-07:00

Erik and I are/were your typical contemporary young couple when it comes to finances: neither of us were out-of-control when it came to money, both frugal, but with college degrees and the student loan debt to go with it, and the relatively low paying job. (I worked in the non-profit sector, and Erik was self-employed.) So, begin our married lives with three loans to pay off (Erik hadn't consolidated, I had). We both paid our own way through college, so our student loan debt was sizeable, yet neither of us went crazy accruing unneeded debt. I wish I could remember what our net worth was then, I think it was close to -$20,000. Neither of us really tracked our spending, but we never really had to as we just didn't spend more than we had (minus college).

It all started with Erik's mom, really. She's the one who pushed reading "Smart Couples Finish Rich" on us and got us going on this whole thing... (thanks Susan!) Now, we have almost turned budgeting and financial management into a game. Of course, being "Yellows" we probably wouldn't be doing it at all if we didn't think it was fun.

Anyway, in less than a year, our net worth is somewhere around $4,000 - not including any of the cars we have that we could sell, or any other "stuff" we could decide to add.

The purpose of this blog is to record our adventures in finance, share fun things we discover, and keep track of finance books we've read and what we thought of them. I'll try to remember all the books we've already read and write up a review of them.

Welcome to our adventures in finance!