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Archive for January, 2013

Potential Layoffs

January 24th, 2013 at 02:13 pm

DH's company had a big meeting yesterday and the company announced that layoffs are coming. It's mostly going to be middle-level managers, which my DH is not. But, we are not panicked. For one thing, DH doesn't think he will be laid off since he's the only one that does his particular job.

But secondly, we feel prepared now for a layoff. We have our emergency fund in place. If DH were to get laid off, he would get about 4 months of severance pay on top of our 6 month emergency fund. Sure, money would be tight and it would suck, but we could probably make it 10 months without having to go into debt.

Two years ago, or even last year, I would have been more worried about potential layoffs. I highly recommend having an emergency fund, for peace of mind!

Keeping it frugal with the kids

January 24th, 2013 at 03:40 am

I was tempted to go to a train show this past weekend. Kids 12 and under were free, adults were $8.00. But when we read the flyer, it said there would be lots of booths with Thomas the Train stuff for sale, along with other train things. DH was the voice of reason and said we shouldn't go, because even though admission was only $16, the kids could pressure us into buying them things.

So we went to a park instead. And the kids had a lot of fun and never knew the difference, since I never told them we were thinking about a train show.

I do want my kids to experience things other than just parks...and they do. But really just for special occasions.

In less than 2 weeks we will be on our Disney Cruise...and that's a special occasion! I already pre-paid for our parking at the port and pre-paid our gratuities and a small amount for souvenirs in our onboard account. Our only expenses not yet covered will be gas to and from port, and some food for the drive.

Money saved/money earned

January 14th, 2013 at 02:25 am

We decided to completely cancel Netflix today. I just did it online. We were only doing the 1-DVD-out-at-a-time plan for $7.99 plus tax, but we figured out we could do it cheaper through Redbox. At most, we watched one movie a week. Plus, Redbox texts me coupons and free movie codes a few times a month. So we figured with Redbox, we can have our movie entertainment for $5 or less each month. I know, not a huge savings, but it's something.

Yesterday I got my updated Discover card in the mail. I haven't used my Discover card in years, and it just expired so they sent me a new one. As an incentive to activate it, they sent me an offer for $75 in cashback bonus if I spent $1000 or more on the card between now and the end of March. Since we charge a lot of things on our credit card and pay it off at the end of the month, I decided it would be worth the $75 to move some stuff over to Discover to get the extra bonus. Between gas and groceries for the next 3 months, we should have no problem hitting the $1000 mark.

A humbling experience at the grocery store

January 7th, 2013 at 04:59 pm

On Saturday I went grocery shopping at Aldi. It's a weekly habit, since the prices there are so cheap. If you've shopped there before you know that you have to pay with cash or a debit card only, as they don't accept credit cards.

I transferred some money from our main account to my checking account to cover my debit card transaction. Apparently I didn't transfer enough and my card was denied at the cash register. I took one thing out of the cart. A manager had to be called to void the item. It still wasn't enough. I had to take another thing out of my cart. Then it went through.

The line was building behind me and I felt like all eyes were on me. I was really embarrassed.

I wondered if people pitied me. We had the money, just not in the right account. But that got me thinking about people who don't have enough money and have to do this all the time. How do they feel? Do they feel embarrassed or shamed? Or are they used to it?

I certainly made me think.

College Funds for the Kids

January 3rd, 2013 at 10:41 pm

The grandparents gave us some money at Christmas to contribute to our kids' college funds. Sadly, the last time we contributed to their funds was last Christmas with money from their grandparents. In 2012 we made our emergency fund a priority. We are hoping to contribute a modest amount to each of our 3 kids' college funds monthly this year. Either $50 or $100 per kid each month, but it will depend on how DH's take-home pay shakes out when we see his first check of 2013 in a few weeks.

I should mention that both my parents and DH's parents helped pay for our college tuition. Both DH and I worked on campus during college, but the majority of our education was paid for by our parents without any student loans. We didn't realize at the time how lucky we were, but now as we see people struggle to repay student loans, we are so thankful for that gift from our parents. (We did each pay for our graduate school tuition years later--I took out a small loan but paid it off in a few years).

I really struggle with the kids' college funds for a few reasons. First, the calculators say that by the time my kids are college-aged, college will cost $150,000-$200,000 for an in-state school. For each kid. So we might be looking at $450,000-$600,000 total. Gulp. We have about $50,000 total saved so far, and over half of that has been from both sets of grandparents.

Second, all the experts say to prioritize saving for retirement. Which I totally agree with. Which is why this month we are back to 15% 401k contribution and extra principle payments on our mortgage, to put us in a good position when we retire.

I also feel like the cost of college is a huge guess at this point. I think at some point, if the costs keep rising at the rate they are, college won't be affordable for anyone. And maybe my kids will get scholarships, or go to community college for the first few years, which would cut the costs dramatically. The costs of college are just so unknown.

I did one of those online FAFSA guestimate calculators to see what our expected family contribution will be for college. It gave me an answer of $25,000 a year for my oldest. Which is basically the full cost of an in-state college with tuition and room and board.

I also struggle with just the balance of it all. Because sure, we could contribute more to their college funds if we didn't go on vacation ever again. But then we'd lose those experiences and memories, and our kids will never be this age again.

So I really hope that by prioritizing our retirement, paying off our mortgage early, but still having some fun memories along the way, we will free up some cash when our kids start college to help pay their tuition with current salary.

What are your thoughts on paying for college? Did your parents help you pay for college? Are you going to help your kids, and if so, how are you planning for it?

Changes for 2013

January 2nd, 2013 at 03:56 am

Woohoo, it's 2013!

Our emergency fund is in place. We paid all of our house taxes/HOA fees in December. We have paid off our February 2013 vacation. We have a small slush fund, car fund, and a vacation savings for the summer.

Our big goal this year is to pay extra principle on our mortgage. We are trying to pay off our mortgage early so that we can free up some cash to help our kids through college. Our plan is to pay off our mortgage in 8 years. It seems overwhelming and like it will take a long time. We have a goal of paying an extra $8244 in principle this year.

We already paid an extra $1000 from a bonus received in December. We will take $1000 from our tax return later this Spring and put it towards the mortgage. We already pay an extra $150/month with our bi-weekly automatic withdrawals. I will add another $300/month on top of that. Starting in September, I will have another $200/month on top of that because we will go a year without any preschool tuition payments. I'm cancelling our lawn service and I'll be doing it myself. Hopefully those changes will enable us to reach our goal.

Today, DH adjusted his 401k contributions back to 15% (we had lowered it to 7% in the back half of 2012 so that we could get our emergency fund in place).

We are also going to begin contributing to our kids' college funds, $100 each per month.

In December, I started a part-time job doing freelance writing online. I earned $400 in December (before taxes). I hope to earn $500 a month with that this year. Not much, but it's something!

Here's hoping for a great year! Good luck everyone on achieving your financial goals!