Total Money Makeover Update: June 2012

Life has been a tad chaotic since I last posted about our Total Money Makeover progress.

After our fire, we lived in a Comfort Inn for 6 weeks. We ate out every night–which is not in our normal budget–and were begrudgingly given an advance of $500 (after we’d spent about $1000) by an insurance lady who said they didn’t usually give advances for food. (Which begs the question, What must one need in order to get an advance?)

Then, we moved to a condo and were given a rather random and unhelpful assortment of our stuff to live with. Salad spinner – yes. Bed sheets – no. We also were blessed with the companionship of a family of adorable, but filthy and disgusting brown mice who were much too smart to crawl into our humane mousetrap, even when it was full of cheese and peanut butter. About a week before we moved out, our property manager finally returned our call about taking care of the mice, but we decided to live with the mice and let maintenance deal with mouse-killing after we were gone.

About a week and a half after we moved back into our newly remodeled home, I took one of my students to the hospital and spent most of my evenings for the next three weeks with her. When she was discharged, she moved in with us and became our unofficial foster daughter for a few weeks. Then, she decided to get married.

During all of this, Dexter spent about two months out of work, though God blessed him with a few fantastic freelance jobs. He now has a nice, predictable job at a bank and I get to see him dressed up, tie and all, every morning. We also took an amazing class called Perspectives which added plenty of homework to our schedule. Dexter, always creative and always entrepreneurial, started a handmade product business which I’ll tell you more about soon.

How has all of this life affected our financial situation?

For the last eight months, we haven’t budgeted well at all. We started using a credit card and paying it off every month, but then using it again because paying it off used up our cash flow. After depleting our emergency fund, our car stopped working, so we opened a new, interest-free credit card for that bill.

For me, this summer is about getting back on track financially. We’re paying off the credit cards, getting back on the cash envelope system, and trying to live simply.

I remembered getting to the 75% mark in our debt repayment process, but I didn’t remember how close we came to 70% last time I calculated our debt. I was happily surprised that after months of paying only minimums, we had still made visible progress. Over the past seven months, we paid off 2.8% of our debt and have 67.9% to go.

We haven’t received the check for what we lost from the insurance company. This is mostly our fault, because we haven’t finished our paperwork. I like to blame this on the people who cleaned our house, because we keep unpacking damaged items mixed in with undamaged items, and having to record them in our paperwork. We have a few pieces of furniture to get repair estimates for, and then we should be done. Once the check comes in, things will look a lot more cheery in the financial department. With the check, we’ll do things like:

  • Save money
  • Replace our bed (We are currently floor-camping, and have been since February 6. It’s surprisingly comfortable, but we’re thankful for the new carpet underneath the sleeping bag.)
  • Replace our couch, window treatments, and set money aside for things we discover we need in the future
  • Fix our air conditioner
  • Look into refinancing our house
  • Finish paying off Debt #3

In my imagination, we’ll take the rest of our thousands of dollars and go on a vacation and buy a new car, but it’s unlikely we’ll be able to do all the things on the list above. A girl can dream.

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Total Money Makeover Update: March 2011

Photo Credit: Egahen

The past 28 days have been busy. Although in January I resolved to use cash for all of our spending, we never made it to the bank to get cash for this month. Fortunately, we didn’t have a lot of time for shopping, either, so I didn’t waste money on things we didn’t need. We bought food and toilet paper, and we paid our bills.

We had a friend move into our basement for a three-or-four-month stay and invited another friend to eat dinner with us on a regular basis, so we had to increase our grocery budget. I’m still figuring out what a grocery budget for three grown men and one woman should look like. Fortunately, I don’t think it will quite double what we currently spend. Hopefully, it will help us to use up everything we buy and will force me to plan meals better. (It’s a lot harder to “wing it” at dinner time when there are four stomachs to feed!) I may have gone a little crazy buying canned food for the nights I don’t feel up to cooking. There were some good sales on Indian food and Muir Glen organic soups the weekend our friend moved in, and I bought about 16 cans (which is really only about 8 meals). I’m hoping to get some freezer cooking done over spring break to further save money and take the stress out of making dinner. (Dish suggestions welcome!)

Last month, I shared a review of the progress we made after having done our Total Money Makeover for a whole year. It was rewarding to see how all our hard work has paid off! When I made this month’s budget, I was a little disappointed. We had lots of extra income due to our tax return, but we also had some larger-than-usual expenses, so the extra loan payment amount on my spreadsheet looked pretty boring and average. However, after totalling our remaining debt and calculating our percentage, I’m encouraged. This month, we paid off 1.1% of our debt and we have 76.6% to go.

I’m also encouraged as I look at the balances for each of our loans. I can see a difference even in the balance even for the loans we haven’t paid extra on. Debt #3, which we are working on now, is looking pretty conquerable. I’m hoping to have it gone by July 1. Debts #4 and #5 are still dauntingly huge, but Debt #5’s biggest digit will drop next month.

Currently, I’m taking Leah’s advice and praying for God to provide opportunities to earn extra money and speed up our debt repayment. For now, we’re pressing on and are hoping to be at the 75% point very soon!

Spring Break on a Budget

For a few short days in December, Dexter and I entertained the idea of visiting New York City over Spring Break. It’s on both of our 30 Before 30 lists (although I’ve been there before), and we were both a little anxious for adventure. (Sometimes I feel like since I don’t have kids–and not because I don’t like them–I am entitled to have adventures. It’s not a healthy mindset.)

I had it all planned out. We were going to stay in this swanky vintage style hotel. We were going to indulge in dessert (and maybe dinner) at this Smitten-Kitchen-mentioned* restaurant. We were going to walk, wide-eyed, around this museum.

But, alas.

Remember my post about making money decisions? Well, reluctantly, I took my own advice and looked at the price of a trip (and let me tell you, I researched some bargains!) in another light. I calculated how much extra interest we’d pay in the long run because of the money we’d spend on our trip. Then, I figured out that by spending Spring Break in New York, we’d be keeping ourselves in debt for an extra 6 months.

Yuck.

We remembered the verse in Proverbs that says, “It is the blessing of the Lord that makes rich, and he adds no sorrow to it.” And we were pretty sure we’d be sorry during the fall of 2014 as we were sending our checks to the student loan company rather than transferring money into savings. So, we decided not to go.

We realized, however, that we do need to get away. We need a weekend without dirty dishes, without picking up dog poop, and without phone calls from work. So, we followed the example my parents set and planned an “urban midwest getaway.” This summer, you might remember, we spent a weekend in Kansas City. Chicago also makes itself into our weekend getaway rotation. (For some reason, we ignore Omaha.)

So, in less than two weeks, we’ll be gazing at the Minneapolis skyline. And we’re pretty excited.

Like New York, the Twin Cities have hotels, restaurants, and museums. And they’ll be noticeably more budget-friendly than their NYC counterparts. This trip will keep us in debt less than a month longer than we would have been. Which, I think, is an excellent trade-off when you consider that our options are a) go on this trip or b) go crazy.

Here’s the thing: We don’t really know the Twin Cities area very well, so we need your tourism advice.

What would you do on a weekend away in Minneapolis?

(Can’t decide what advice to share? Consider the following. We’re not on a super tight budget–although concert tickets at $100 a pop aren’t going to happen. We like food–especially local, organic, and humane. We like coffee–especially fresh, small-batch roasted coffee. We like shopping. We like museums of all sorts. And Dexter is kind of a hipster–you know, the good kind, with hipster taste and none of the attitude.)

*Click that link. Make that gingerbread. Flour your pans well. You won’t regret it.

Photo Credit 1 & Photo Credit 2

Total Money Makeover Update: February 2011 and One Year Review!

First Birthday
One year ago, Dexter and I made the decision to buckle down about getting out of debt. We pored over Dave Ramsey’s Total Money Makeover book, and my aunt and uncle gave us a subscription to Financial Peace University. Then we put what we learned into action. We cancelled our credit cards, switched to using a cash envelope system for most of our purchases, and we revised and tracked our budget month after month. We were encouraged as we tracked our debt repayment and had big months like April and July. We were discouraged the months we were lax about our spending or didn’t have much extra income.

It’s been a month since our last Total Money Makeover Update. In those 31 days, we paid off 0.9% of our debt. We also brought our baby emergency fund back up to $1,000 (because we realized after-the-fact last month that the money wasn’t all there to fill it up). We also took care of a few yearly expenses. We stayed pretty close to budget in most areas and succeeded in using the cash system *most* of the month.

Let’s take a look at the year in review, seeing what percent of our debt was repaid each month in the last year.

This brings us to a total of 22.3% of our debt GONE! We have 77.7% to go. Let’s break it down some more.

  • Highest Month – April (thanks to the tax-credit we received for buying our home!)
  • Lowest Month – September (my third consecutive month without a real paycheck)
  • Average Per Month – 1.9%
  • Projected finish date at the beginning: March 2014
  • Projected finish date at 1.9% paid per month: June 2014
  • Projected 50% date at 1.9% paid per month: May 2012

I so badly wanted to sell off everything we own to get down to 75% this month. I thought that being a quarter of the way through our debt in a quarter of the time we wanted to take to pay it off sounded really good. It’s disappointing to realize that we’re a few months behind schedule. However, I’m so thankful for how far we’ve come. Our debt is scheduled by the banks to be paid off in 20-30 years. Four years and some extra months is so much more encouraging than 30!

I’m also refusing to be discouraged because of some things we’ll be changing in the next year.

  • Last year, we saved $200/month to replace our car whenever that becomes necessary. Because we think we have enough saved to replace our car’s transmission if that were to go out or to buy an old car to tide us over till we’re out of debt, we’ve decided to stop saving for a car. From now on, we’ll have an extra $200 a month to put toward our debt!
  • Starting this summer, we’ll be having the housemate who lived with us last year move back in. Although last summer he lived here for the cost of groceries and a little for utilities, since he’ll be staying here long-term, we’ll actually be making a little profit from rent. We researched how much he’d be paying for accommodations nearby and are charging him a lower price. We’re hoping to save him money and speed up our debt repayment a little, too!

Most importantly, we’re refusing to be discouraged because we’re trusting God to work out our financial situation as he sees fit. If he wants us to be done in March 2014, that’s when we’ll be done. If he wants us to be done in June 2014 (or later), we’ll trust that his plan is good. If he wants us to be done earlier, I definitely won’t fight him either!

We’d like to say thanks to all of you who have encouraged us over the past year. Your positive comments, especially in the slowest months, meant a lot to us. Although we’ve heard stories about people being mocked and even berated about their decision to live frugally and become debt free, we’ve been blessed to have family and friends who think it’s cool that we’re making these financial decisions.

Let’s get year 2 of this Total Money Makeover started!

Money Monday: How I Track My Budget

It took me a long time to find a method of keeping track of our budget that was simple and efficient. Everybody has a different system. One of my aunts doesn’t have Quicken (or a system like it), online banking, or a debit card. She loves the simplicity. Alicia uses a handwritten ledger, and explains her system here. I used Microsoft Money before they stopped updating it and no longer offered online support. I tried Mint.com for a while, but it wouldn’t upload all my accounts, or I’d have to change my password and it wouldn’t let me login, and it wouldn’t let me split transactions (if I bought both gifts and groceries at the same store) the way I wanted to. We splurged for Quicken, and I finally have a thorough but easy-to-use system.


At the beginning of each month, I figure out how much money we have leftover from the previous month, predict our salaries and expenses for the month, and record them on an excel spreadsheet* (shown above, download here).  Once the income and the necessary expenses are filled in, I allot money for birthdays or weddings we’ll be shopping for that month, date nights and spending money, and most importantly, I use up the rest of our money in an extra loan payment as part of our total money makeover.

Then, I take out cash for several of our spending categories. Ideally, I’d walk into the bank and get the exact bills I need in one trip. Unfortunately, we often fail to get to the bank when it’s open, so we hit the ATM several times over the course of the first week to fill our envelopes. When I withdraw the cash, I categorize the transaction in Quicken with the exact amounts of cash that went to each category. Here’s what typically goes into our envelopes each month:

  • General Groceries: $200
  • Stock-Up Groceries: $50
  • Church Groceries: $20
  • Clothes: $50-100
  • Toiletries, Cleaning & Other Household: $50-100
  • Date Night: $50-100
  • “Blow Money”: $20 for each of us
  • Love Budget“: $10 for each of us

We try not to use our bank cards of any of these things. If we do, whether because we left cash at home or we bought something online, we deposit that cash back into the bank and note in Quicken what category that money should go to.

Ideally, several times throughout the month, I download my transactions from my bank’s website, assign each one a spending category, and compare Quicken to my spreadsheet. This process shows me how much room we have in the budget for non-cash categories and lets me make sure none of our envelopes “owe money to the bank.” In real life, this happens once in the middle of the month before I write our extra loan payment check and before our mortgage and other larger bills go through, and then at the end of the month.

To quickly compare my spending recorded in Quicken to my budget spreadsheet, I use the exact same category and subcategory names in Quicken that I do on my spreadsheet. Quicken will create a report for me of my spending in each category for a period of time (shown above), so I pull that up alongside my spreadsheet whenever I want to check how closely we’re following our budget. Unlike Dave Ramsey’s worksheets that put things in order of priority, e.g.: tithing first, then housing, etc., my spreadsheet alphabetizes the categories and subcategories so I can quickly glance from Quicken to the spreadsheet to compare.

At the end of the month, I enter our actual income and expenses. The surplus shown in our spreadsheet should exactly match the balance in Quicken on the last day of the month. (That works for us because we’re only tracking these categories in one account. It would be harder if you had multiple checking accounts or credit cards involved in the process. Which is exactly why I don’t have those!) If the numbers don’t match, I double-check Quicken and my spreadsheet to find the problem. Then, I start over again and prepare our budget for the following month.

What budgeting tips do you have? What money management system works for you or your family?

*I didn’t create this entirely myself. I found one from a friend of a friend of a friend online and adapted it, but I can’t find the source now. If it was you, thanks!

Spaghetti Squash Pizza on a New Blog!

Dexter and I are starting a new experiment. Or maybe it’s a challenge. It started when I was SO tempted to increase our budget for eating out so we could eat out once a week and go out for coffee and Bible-reading dates on weekend mornings.

I have a great, new after-school job tutoring at my school through a fantastic program. Working three afternoons a week at my “teacher’s hourly pay” will provide a great source of debt-reducing income, but it also means that I don’t get done tutoring till 5:00 and I might have to stay and plan for the following day. Some days I won’t get home till close to 6:00, and on those days, eating out or ordering in sounds tempting. And I feel like I deserve it.

My friend Leah said something on her blog several months ago. She decided to “give herself the gift of 10 fewer pounds” for her birthday. That made me look at dieting from a whole new perspective. It’s not depriving yourself of food–it’s being responsible and making sacrifices so you can treat yourself to good health and self-confidence. I have taken this line of thinking into other areas of my life as well. I can choose to think about paying off our debt as depriving myself of things I want right now, or I can think of it as giving myself the gift of freedom from debt.

This new resolve to really channel all our funds toward paying off our debt led to the decision to budget enough for eating out twice a month. We’ll have coffee where we can get it for free, use our personal spending money, or make coffee and yummy pastries at home on our weekend mornings. Since we won’t be eating out two or three weeks out of a month, we needed something to do on date nights for free or very cheap. Cooking together is something we’ve wanted to do for a while, but never got around to, so we decided to commit to trying it out.

We thought it would be fun to get a cookbook to cook from that would have lots of great recipes. We found one vegetarian cookbook with a “cooking for two” theme, but it was out of print. We looked at aphrodisiac cookbooks for some romantic ideas, but some are a little risqué, and we didn’t want to have to hide our cookbooks whenever we had guests over. We looked at some seasonal cookbooks, but realized that we don’t want a cookbook that has too many meat recipes because we eat so little meat.

That’s where the idea of How to Love an Omnivore was born. This blog is a joint project in which Dexter and I will cook together, hopefully on a weekly basis, take pictures, post about our culinary adventures, and share tips about cooking, marriage, and life in general. You can read more about us and about the project here.

This week, we made our first recipe together, Spaghetti Squash Pizza. It was a rough start, but challenges are much more interesting to read about than huge, easy successes, right?

By the way, I don’t plan on replacing Mrs. Dexter with HTLAO, although one might think that by the infrequency of my posts. I actually set a goal (during a goal-setting assignment for my students) that I would post at least once a week on this blog. Hopefully I can set a good example and make good on my goal!

Total Money Makeover Update: June

It hardly seems worth it to update this month. We made a fairly normal extra payment on our mini-mortgage (Debt #3) but didn’t see a huge drop in percent. We paid off 1% of our mortgage and now have 89.1% to go. It’s a good thing we dropped from the 90s to the 80s or I might have been discouraged.

I had a lot of trouble with our cash envelope system this month. My students often ask me change for the vending machines, so I’d take ones out of different envelopes and decide to “remember” to rearrange it later on. Somehow, it got out of control and I had a wallet full of empty envelopes and a pile of cash and receipts. Somehow, we came out under budget. My goal for the summer is to get used to using cash and sticking to my plan.

Although this month wasn’t what I’d hoped (nor was last month) I am REALLY excited to pay the bills this summer! I’ll be getting my summer paychecks for my “real job” all at once, some checks will hopefully come for some extra “real job” hours, and I have a part-time job for four weeks. We should definitely be down to 82% by the end of the summer, but wouldn’t it be exciting to break into the 70s?

Cruelty-Free Living on a Budget Part 2: Money Ethics vs. Cruelty Ethics

Buying all-natural products that don’t test on animals can get expensive. Paying interest on debt is expensive, too. For years, I’ve toyed with the idea of switching to all cruelty-free products, all the time. There are several barriers that have prevented me from making this choice:

  • Sticker-shock. It hurts to pay $4.29 for a stick of deodorant or $14 for 60 loads worth of laundry detergent. When buying cruelty-free, you’re forced to buy less in general, buy less of particular items, or give things up altogether. Blogs like MoneySavingMom.com feature posts outlining how you can get many household and personal care products for nearly free by combining coupons and sales, but cruelty-free products often don’t go on sale or don’t offer coupons. Or they’re so expensive in the first place that the sale/coupon combo doesn’t make much difference. You can expand your budget for these items, but that money has to come from somewhere. In my case, it would have to come from the extra money we’re pounding into our debt snowball. And that really hurts.
  • Self-education. It’s hard to begin thinking of all the things you buy from companies that test on animals. The same company that makes Skippy peanut butter makes Dove soap and Surf detergent. If you choose not to buy from a particular company, you’re restricting yourself in almost many areas of purchasing. It’s dizzying to decipher which brands are subsidiaries of which other brands.
  • Drawing personal boundary lines. I have some perfectionism running through my veins. I tend to think that if something is worth doing, it needs to be done all the way. However, there is some grey area in cruelty-free that makes me wonder if it might be okay to compromise. Some companies, like Clorox, have new lines like Green Works that aren’t tested on animals. These products are usually much cheaper than the non-mainstream, all-natural, cruelty-free products on the shelf, but they leave me in a quandary. Buy the more expensive product from a company that doesn’t test on animals, or buy the cheaper product from the brand that doesn’t test but the company that does? Looking into cruelty-free products also leads me down the slippery slope of “natural” and “organic” and how much better those products are for me and for the environment. Usually, I don’t even understand what is harmful about a product in the first place, but the hippie in me believes. I always think of Barbara Kingsolver’s quote about the “uncountable deaths by pesticide and habitat removal—the beetles and bunnies that die collaterally for our bread and veggie-burgers,” and wonder how much my deodorant and toothpaste is affecting the cute furry creatures I see in my backyard.

In the past few months, Dexter and I have decided we want to get more serious about cruelty-free living. I’ve learned some promising things about a few brands that don’t test on animals or who do only in select situations, but that are still normal, mainstream brands. Although some of these brands do test when non-animal options are unavailable, many of them financially support the development of alternative methods. I still don’t like that they test, but I know that animal testing will only be eradicated bit by bit in the real world. These are brands that I have decided to buy for the time being. Brands and links to the pages that tell about their animal testing policies are listed below*. Be sure to peruse their websites to see the variety of easy-to-find brands their companies represent.

I had hoped to find evidence that store brands don’t test on animals (although their products would still be developed based on testing by other companies), but I scoured the internet for proof and found nothing. And with animal testing, no news is generally bad news.

For information on companies who do not test on animals at all except for what is required by law, I recommend Caring Consumer where you can search by product, companies that do test, or companies that don’t test.

*There is some debate about whether or not some of these companies are true to their policies. I don’t know if there is any real evidence against them, but I encourage you to do your own research.

Total Money Makeover Update: May (Plodding Along)

After a month of kicking debt’s butt, this month was a little discouraging. After buying new running shoes and setting money aside to take the dogs for their annual vet visit, we expected to pay $4 extra on Debt #3.  And we paid it.

When I finished up at the end of the month, we miraculously ended up with a lot of unspent money. I double and triple checked to make sure it wasn’t there because we forgot to pay some important bill. But no, we had just underspent. I whipped out my checkbook as fast as I could, wrote a check, and popped it in the mail. Because extra money has a habit of spending itself.

At the end of the month, we paid off 2% of our debt and have 90.1% remaining. We’re thankful for the blessing of extra money and hopeful that next month will be even better!