How I Got Here

It's pretty much a given that most people's financial education starts at home. Some people learn what to do with money. Some people learn what NOT to do with money. I learned a little of both.

My parents aren't exactly terrible with money. They made a lot of the typical knucklehead moves like buying a timeshare or refinancing the mortgage multiple times. They probably shouldn't have credit cards as they tend to go through the cycle of:

1.) Run up the credit card balances
 2.) Do something drastic to pay them off (see multiple refis above)
3.) Close all but one "for emergencies"
4.) Rinse and repeat

That being said, they've never been evicted and they've never defaulted, that I know of.  We never went hungry.  They didn't have to worry about saving for retirement because they both have pensions, though dad did a handful of part-time gigs starting basically the day after he retired from his full-time government job.

My maternal grandparents were great financial role models. They were stereotypical children of the Depression, though my grandfather was quick to tell you that the Depression never made a difference because they were poor before it happened and poor afterwards. They used everything they could and when they were done with it, they used it for something else. My grandmother made a lot of my mother's clothes when she was a child (and a few unfortunate outfits for me as a kid). They grew food and canned/froze it for the rest of the year. No lie, when I cleaned out their deep freeze in 2010, there was frozen corn that they had grown in 1998. And he would have insisted that it was still fine. They invested. My grandfather had a monthly ritual of calling around all the local banks to see who had the best CD rates for the one that was coming due that month. I'm pretty sure I get my love of playing with my money from him.

 My paternal grandparents were...not so great role models. Though it wasn't until they passed that anyone had any idea how bad it really was. I mean, as a kid you don't quite understand the reality of the absolute mountain of gifts at Christmas when grandma and grandpa are on a fixed income. My dad was the executor of the estate when we found out that they owed something like $40k on 13 different cards and had already taken out a loan against their house and land to pay them down. I still remember the calls, and the calls, and more calls. The scummy creditors who tried to convince my dad that it was his responsibility, as the executor, to pay them even if it meant paying them out of his own pocket.  I remember some of his very...colorful...replies to that request.  It took months to straighten everything out and, in the end, they weren't able to save the house.

From all this, I can say that I probably got my saver personality from my maternal grandparents. There are quite a few skills that I wished I'd paid more attention to, but at least I have YouTube because my mom paid even less attention than I did. All in all, I'd say that I was very, very lucky to be able to (mostly) learn from watching my parents struggle. I think that my paternal grandparents situation is the one that had the most impact on me. I was 15 when it all went down, so it was still fresh on my mind when I went to college. Because of that, I resisted the credit card companies who were set up outside the university bookstore pushing free t-shirts and pizzas for filling out credit card apps.

At the end of college I fell into the trap of being married to a super-spender.  He had both a drug problem and a keeping-up-with-the-Joneses problem.  I left that marriage with between five and six thousand dollars worth of credit card debt with a foreclosure and a car repo on my credit report.  In what is now a funny side note, when I got the first draft of the divorce papers from his attorney my ex demanded that I cut him a check for "my half" of the credit card bills.  We had similar amounts on cards in each name.  No joint cards.  Seeing as how he had never dealt with the checking account or bills while we were married and wouldn't even know where to start to pay my credit cards, I not-so-politely turned down his "generous" offer.  I'll post about the shitstorm that was that time of my life soon.

After that, I moved back in with my parents.  I took a shit job and then quickly moved on to bartending.  That was about the time I decided that I had to get myself back into school.  I saved up and paid for my first two classes in cash.  Because I already had a degree, most of my general ed classes were already out of the way and there were only a handful of my new major classes that I had the pre-reqs for.  I tended bar at night and went to class in the mornings, paying as I went.

Eventually, I landed a co-op position that allowed me, nay required me, to go to school full-time and work 10-32 hours a week, depending on my school schedule.  They paid books and tuition.  That job transitioned to full-time a week after graduation.  That was 7 years ago.  I still owe them 2 more years for all the tuition they paid, but I mostly like my job so that's not a big deal.  It's also a great paying job for my area with fantastic benefits and one of the best retirement plans available.

I'm remarried with a kiddo now.  He's not fantastic with money, but understands that and lets me handle everything.  I like it that way.

Thrifty Thursday

I had intended to start doing a feature called Thrifty Thursday today to document my absolute love of all things thrift stores.  Seriously, anyone who knows me knows that I love some thrift store shopping.  I love everything about it.  The prices.  The thrill of the hunt.  The unique finds.  I really love the concept of giving new life to old things.  Now there are a few things that absolutely draw the line at.  I don't do matresses or cushioned furniture or anything else that could bring bedbugs into my house.  I also don't do socks or underwear (ewww).  There is a grey area for me and that area is shoes.  I don't like shoe shopping.  I've been wearing the same pair of work shoes for the last 15+ years and they need to be replaced.  Badly.  So, what's the big deal?

The deal is that they are Dr. Martens and they were on the expensive side when I bought them.  And in the last decade and a half, production of them has moved from England to Asia and with the move, the quality has reportedly gone down.  Now, some production has been moved back to England, but they are significantly more expensive.  What's a girl to do?

Enter Poshmark.  It's a site to buy and sell used clothes, shoes, and accessories.  I've had very good luck with sellers over the last couple of years, so I checked them out.  I hit the like button on several pairs that were my size, made in England, and listed for a price I could live with.  I even found a pair of the exact shoes I have.  Within an hour of my liking that pair, I got an offer from the seller.  She, or Poshmark on her behalf perhaps, offered $20 off and free shipping.  Yes, please.  Now hopefully I can get 15 more years out of this pair. 

Grocery shopping basics

We are a family of 3. Two adults and a bottomless pit of a 5 year-old. My goal is to average $2/person/meal. I shop every two weeks and plan about 10 dinners per shopping trip. Why 10? Because at least one, maybe two, of those planned meals will be something that I can double, triple, or quadruple and freeze. So, a few nights a week are either something out of the freezer or leftovers. Tonite is a freezer night.

The process starts by checking out what's on sale, specifically meat. I have a list of the various grocery stores in the area and what days their sales run. Most sales cycles around here run Wed-Tues, so I usually start at least thinking about my menu on the Wednesday a week before I pick up my order.

Once I have an idea what's on sale, I start building my menu. If there's something at a fantastic price I'll pick three or four meals with that and fill in the rest with other stuff. My family would riot if we ate chicken 14 straight days, so I do try to mix it up. I also buy a little extra when stuff is on sale so that I have a decent mix of things in the freezer. Speaking of the freezer, I do also like to keep that in mind when I'm picking out the menu so that I cycle through the stuff there. Also, since most of it was bought on sale, I'm cutting my per meal price down.

To organize things, I use an app called Pepperplate. It lets you collect and tag recipes and will build a shopping list for you. You can choose your own tags, but at minimum, I tag recipes with the kind of protein it has. That way if pork is on sale, I can quickly filter down to just the pork recipes. I can also create a calendar to plan which meals go on which days. I do schedule some meals, especially for meals that have ingredients that won't last two weeks in the fridge. I try to schedule those meals for earlier in the week. I also like to schedule time-intensive meals for weekends. It helps with the "what's for dinner" dilemma.

Now that the shopping list is built, check off the things that are already in your pantry, fridge, and/or freezer. There is no use buying something that you already have, unless it's something you use a lot and it's at a rock bottom price (I'll write a separate post about that later...I promise).

Next, I put everything that's left on the list into a Walmart shopping cart. This is my baseline price. Let me tell you, online grocery shopping is a game-changer. I save a ton of money just on not making impulse purchases. Do you have any idea how much less I spend just by virtue of not taking the husband and/ or kiddo into the store? Also, there's no more standing in one grocery store trying to remember if X is cheaper down the street. I can easily see if the Walmart regular price is more or less than the advertised price at the other stores. Sometimes it is, sometimes it isn't. Finally, I don't have to be that person standing in the aisle with a calculator trying to figure out what's the best deal (I've so been that person). And if I do go over budget, it's easy to look back over my cart to see what can go back without having to backtrack across the store.

But remember how we built our shopping list based on what was on sale? Now that the WM cart is full, I go back to that ad and see if it's really a good deal or not. If that item is still cheaper at the other store, and it's cheaper enough to make it worth it, I'll take it out of the WM cart and buy it at the other store. I'm not going to drive 15 miles out of my way to save 37 cents, but if it's a store I'm going to be passing anyway and I'd save $8 then I'll do it. This is also a good opportunity to check out all the other items in the ad. If there's something that's slightly cheaper than baseline go ahead and get it somewhere else, and take it out of your WM cart. For everything else, just pick it up.

I tend to not go to more than one other store a week unless it's just a smoking deal or it's something that we use a lot of. I've found that a lot of times, all the local stores will have the same basic things on sale at the same time, so it just depends on who has it cheaper and how far out of my way they are. As for this week, we're looking at pork loin roast and boneless country style ribs for under $2/lb and Sweet Baby Ray's BBQ sauce for 99 cents (that's almost half the price of Walmart, y'all). I'm thinking we'll be doing some BBQ in the crockpot. for under $1/serving. That will leave plenty of room for veggies and starches, if you eat those, and still be under $2.

It was almost too pretty of a piece of meat to cut up...

Now's time to hit the sales items that might not necessarily be on your list.  I try to make it a game to see how close I can get to my allotted amount without going over.  This can be things that are on sale because of the sales cycle like ketchup just before Memorial Day or things that are nearing their sell-by date.  Today's find was a beautiful beef roast for just under $12, or $4.50/lb.  It's a little more than we would normally pay for meat, but it's a  fantastic price for stew meat.  To keep us under our $2 goal, we might use this for beef stew and only use a half pound per batch.  So, I took it home and chunked it up and froze it in a single layer.  Once it's frozen enough that it won't stick together, I'll throw it in a container that I can scoop it out of when i need it.

....Almost.  I'll get at least 4 and probably 5 meals out of this.

What are you doing this week to optimize the grocery bill?

Cutting the Cord

Like a lot of people, we cut the cable cord.  It's been long enough now that I feel pretty confident giving you all my review of the different services we use. 

First of all, we eased into streaming.  My husband wasn't really convinced, but our cable/Internet bill had become ridiculous.  It had finally crept up above $200/month and I was beyond done.  I bought a Fire Stick on sale and added it to the main TV.  We used it, along with the regular cable, for a couple of weeks.  Then the storm hit and since we were moving out of the house anyway, it seemed like as good of time as any to cancel U-Verse.  While we were living with mom and dad the rooms we stayed in didn't have a cable drop, so we had to either stream our TV or go downstairs and be sociable. 

We currently use Prime, Netflix, and Boomerang the most.  We also use PlutoTV and FreeDive occasionally.  And of course, YouTube.  So, let's talk about them, huh?

• Amazon Prime:  There's a pretty good chance that we'd have this even if we didn't stream TV, but I'm pretty sure that if Amazon ever split the video portion off into it's own separate entity a la Amazon Music Unlimited then we wouldn't bother subscribing to it.  The selection of movies and shows is just okay and the menu teases you with selections that are available "to rent" and not included as part of Prime.  I did enjoy the Mind Over Money series
• Netflix:  What can I say?  It's the original streamer.  The selection is good.  The menu is straightforward.  What you see is what you get as far as being included with the subscription price.  The bad news is that the price keeps going up.  Right now, it's still worth it, but the playing field is changing and I'm not sure for the better.  They are throwing a lot of money into original content, a lot of which is really good.  I can't wait for the next season of Stranger Things.
• Boomerang:  This is for the kiddo.  It's probably the one we get the most value out of.  It runs in the ballpark of $40/year and worth every penny.  Lots of old school cartoons:  Scooby Doo, Jetsons, Flintstones, Tom and Jerry, etc.  My only complaint about it is that unlike Netflix, it doesn't have an attention check after every couple of episodes.  It will play all day or night if it gets left on.  That's no bueno when you're not on an unlimited data plan.
• PlutoTV and FreeDive:  I'm bundling these together because they are super similar.  The lineup of content is even very similar.  This is a good way to get some of those Discovery Channel shows that I used to be such a sucker for.  Pluto does have a live option, in addition to on-demand, where you can watch their channels like you would watch regular TV channels.  We've been doing mostly on-demand for years anyway, so this doesn't matter much to us.  There is a live news channel though if you want to keep up with the news that way.  Both PlutoTV and FreeDive are free services and thus have ads.  They are pretty short, but can't be fast-forwarded through.  FreeDive seems to do a better job of placing the ads in natural breaks.  Pluto will sometimes stick an ad right in the middle of a sentence.  The content isn't super new or super vast, but it's definitely worth more than what you pay for it.
• YouTube:  Here I'm talking about just YouTube, not YouTubeTV.  I like the ease of casting a video from my phone to the TV using the app.  It's interface on the TV is kind of clunky, but it's another free option.  I like watching older shows, even if the quality is lacking.  I torture the kiddo by making him watch old episodes of Sea Hunt.  Good times.  

I'm very interested in the service Disney is planning to introduce soon.  At $6-7 a month, it is a little more expensive than Boomerang, which it would likely replace.  I have my doubts that Disney will be able to hold it at that price for very long either.  Time will tell whether or not this is something that will become part of our lineup.  There is a very real danger of adding more and more subscriptions without analyzing which ones you are actually watching.  We've been saying for years that we would like to be able to only pay for the channels we want.  Now, we're getting closer to that reality, and are finding that at $3-7 per channel, it may not be any cheaper to do so.  

One percent at a time

So, one thing that I've been really working on lately is increasing my savings rate.  At the end of last year, I adjusted my W-4 withholding, cut cable, and increased my retirement contributions by 9%.  I was able to get an additional 1% in February when I received a COL adjustment to my paycheck.  I'm currently at about 30% between my work plan and my Roth IRA.  During next open season, I'm going to add a HDHP and HSA to the mix as well.  But is there anything else I can do?

The idea of optimization is that you can make little steps in your every day life to get closer to your goals.  So, my goal has become to decrease my expenses and/or increase my income 1% at a time.  I mean, why not?  It's "just" 1%.  A few dollars a day, really.  Enough to feed one of Sally Struthers' kids.  Or buy Alex Trebek's life insurance.  But that 1% can be huge.  I'm only about 4% away from maxing out my work plan.  If I can find money that can be better optimized as savings then I want to do it. 

Because 1% seems like such a small amount, I started looking at the things that can be cut easily.  The low-hanging fruit, if you will.  So, I started reading articles with titles like '15 Simple Tips for Saving Money."  And what I found was....that I'm already a cheap bastard.  Seriously, tips like "Don't buy $5 coffee" and "Make a budget and stick to it."  In all my searching, the only tip I found helpful was one about keeping your car tachometer below 2000 RPMs to improve gas mileage.  That shit works, yo. 

So, back to the drawing board.  I started looking at what my expenses were vs. what I had budgeted for them.  I found that on average I was budgeting about $5 too much a week for gas and $10 per month too much for electricity.  Now we're getting somewhere.  When I run the 2020 budget in a couple of weeks I'll be able to budget less for those two items. 

I've also cut the amount that I spend on groceries down about $10 every two weeks.  My grocery bill is already pretty bare bones, so after this, there's not a whole lot of room to cut it down anymore.  I've got a post planned for my shopping strategy, so I won't go too much into it here. 

Finally, I took a look at my utilities and realized that my Internet company had introduced new plans.  The plan I'd been on was for 600 GB per month at 150 mbps.  The new plan was 600 GB per month at 200 mbps....for $15 less each month.  I couldn't make that change online...I did have to actually call and talk to an actual human being...the horror!  No, actually she was very nice and didn't give me any grief about switching plans. 

All of those little tweaks gave me the 1% I needed to increase contributions again.  Just three more percent to go...

The importance of an emergency fund

What a difference a year makes.  One year ago today was a Monday, much like any other.  My kiddo and I had gone to the store to get Easter eggs for his class egg hunt.  Like a lot of four year-olds, he had begged for some shiny toy and had thrown a temper tantrum when I wouldn't buy it for him.  When we got back into the car, we had a talk about stuff isn't important and how he had so many toys already (a lot of them are from my husband's childhood...my house looks like Toys-R-Us circa 1984 exploded).  Then we went home and made dinner and he asked to watch a movie before bed, so I let him put a movie on the TV in my room to start settling down.

About 30 minutes later, I got a weather alert on my phone.  It wasn't exactly unexpected because the EMA had warning of potential bad storms for a couple of days.  The dog had been pacing and, unusually, hadn't asked to go out all night.  But this was different, it was a tornado warning, not a watch.  I flipped the TV over to the legendary local weather reporter just as he was saying that there is a possible tornado heading towards my city.

And then the power went out.

That was the point where I decided that maybe we should get in the hallway for a little while.  I grabbed the kid and the blankets and pillows and set up "camp."  I told my husband to get in the hallway and gave the kiddo his tablet and turned the volume up as loud as it would go.

I've always heard that a tornado sounds like a train.  I never did really hear it over the kiddo's game noise.  I felt it.  My ears popped when the pressure changed.  What no one ever talks about is the smell.  The first sign that the roof had been breached was the overwhelming smell of pine.  At first I thought it was where the rafters of the house cracked, but when I stepped outside I learned that it was probably the 15 pine trees that used to stand in our yard.

Just as the all-clear was given, the reporter on the radio came back on and told us to sit tight because there was another one on the way.  We sat in that hallway, this time under a mattress, listening to the rain pour through the holes in the roof.  In total shock.  Thankfully, that one went north of us and caused only minor damage.  The NWS thinks that there might have been a third, smaller one nearby that night as well.  As that storm passed, the chainsaws started and they didn't stop for three weeks.

Once we were able to start gathering ourselves, and taking stock we realized that there were at least two trees down on the house.  One came down right above where we had been laying watching the movie.  It also punched a hole in the living room ceiling.  Another took out a corner of the back porch.  The car that had only been paid off for two weeks (the title had come in the mail only the day before the storm) was missed by inches.  All-in-all we were very, very lucky.  We lost 23 trees, and only two of them actually hit the house.  No one in town was killed and there were only a handful of injuries. 

Luckily, my in-laws who live three houses down were nearly unaffected.  They lost a gutter.  And they were out of town.  We were able to stay there for a couple of days until the cold got to be too much and we moved to a hotel.  We spent a total of 4 weeks in three different hotels.  And then another six months living with my parents, who also live on the same block, but were able to stay in their home.

And this is where the emergency fund comes in.  It was such a relief to be able to roll up to the hotel and reserve a week, and then another, without having to worry about what would happen if the insurance company didn't reimburse us in enough time to pay the CC bill (they did, BTW).  I didn't have to worry about whether or not I'd be able to cover deductibles.  We did have some out of pocket expenses.  And in the interest of full-disclosure, we did choose to go ahead and do some home improvement things that we'd been wanting to do.  And we chose to take on a little bit of debt to do that.  It's very low interest debt, secured by money in our bank account.  It's one of the few cases where we're not doing the mathematically "correct" thing, but instead doing the thing that works for us psychologically.

But the real moral of this story is that just because you've suffered one emergency doesn't mean that another one isn't right around the corner.  In April, the engine in my husband's car threw a rod and he decided to put a new engine in it rather than getting something new.  In November, he totaled my car, you know the paid-off one that survived the tornado.  I decided to replace it with something exactly like it.  Same year, same color, upgraded trim package, and many, many, fewer miles.  What can I say?  I believe in buying what I want and driving it for 10-15 years.  I figure that my now 5 year-old will drive it as his first car.  We paid a little more than insurance covered due to the low mileage.  Finally, last month, my husband got laid off from his job.  We're still doing okay.  Even have the ER built back up.  I'm not going to say the last year hasn't been stressful, but it's been a whole lot less stressful than it could have been.

To Fee....Or Not To Fee

Not me, but this is pretty close to my ideal bill-paying setup.

So, my kid's school has an online system to pay for school lunch.  This is awesome!  Anyone who knows me, knows that in my perfect world, everything could be paid for online (I'm looking at you, water company).  Hell, I haven't had an actual checkbook in almost 10 years now and I can count on one hand how many times I've actually had to have a cashier's check cut in that time period.

However, I've noticed a trend lately of parents bitching about how expensive the convenience fee is for this service.  Okay, so it's not exactly cheap.  It's $1.95 per transaction and if you have more than one child at the school each child has to be a separate transaction.  The beauty of it, to me, is the fact that it's a flat fee rather than a percentage.  So, if you are able to pay for the entire semester's meals at once like I did this morning the percentage is something like 1.2%.  Seeing as how I'm getting 1.5% back on that card, I'm coming out ahead.  Though, I can see how if you had more than one kid and could only afford to pay by the month where that fee would be closer to 5%.  At that point, the $2/month/kid would probably come close to outweighing the $20 to get a checkbook and the convenience of paying online.

There are some fees that I don't mind paying.  Like this one.  Or the one that means I don't have to go by the bank and get cash when I renew the car tags once a year.  And there are other, similar, fees that bother me.  Like the $2.95 fee to pay the power bill with a credit/debit card.  I've almost always paid it with a linked bank account and at this point, inertia has taken over.  In theory, whenever the bill is over $193 (which is about 5 months out of the year), I'd do better to pay it on the card.