Lin, Hamilton, NY!

This makes me so happy! Lin-Manuel Miranda talked to Morgan Stanley about personal finance!!
Not only that, Seth Stewart (from the original Broadway casts of both In The Heights and Hamilton) did an interview for MarketWatch about money, too!!

I love Lin's answer about why this topic is so important. He covers almost everything on what that freedom can mean for almost anyone:

Why is building a financial foundation critical for pursuing your passions?
To educate yourself about personal finance is to empower yourself with the resources and tools needed to help you achieve your goals: whether it be owning your own home, starting a business, making a living off of your passions, providing for a family, having a healthy relationship with money, or paying it forward.

I like that Seth's first answer focuses on balance; he skimps in some areas to splurge in others:

MarketWatch: What are you a cheapskate about? What do you splurge on?
Seth Stewart: I’m a cheapskate on my rent because I’m an actor. I splurge on food and vacations. I am living further out in Queens [New York] so that if I don’t have a job for a year, I’m not stressed about my rent. Every actor’s had a dry season because of what we do. Our work is never guaranteed. I’m saving my money. But I make sure I go out and eat all the time. I love really expensive meals. I feel like that’s what life’s about: Good food and good conversation.

I love that artists are talking about money in this way. Back in my day [she croaks], money was still a fairly taboo topic with those in my little arts community. Some nights after shows, we spent way too much in fancy restaurants (but hey, I got to shake Bernadette Peters' hand once). I never minded working for free in theatre, but I did mind that I paid for that by working 11 pm - 7 am, proofreading at a law firm. We would sigh and curse money, but we never had fruitful conversations on how to manage money.

I also think it negatively impacted my ability to support myself in the field. I was too desperate for jobs to get them. I wanted them for the wrong reasons. Then, my life took some weird turns and I put that dream behind me.

Of course, there's no way of knowing what could've been, but I am hoping my girls will have more friends like Lin and Seth than I did. I'm doing what I can, but the more people talk about this, the better chance they all have of succeeding.

We're very good at talking about hard work, but not so good about talking about how to really make those hard-earned dollars work for us. The concepts are not so complex, but it's still difficult to practice them until they become a natural part of daily life.

Part of that difficulty stems from the discomfort that arises from telling friends "no" to get-togethers or walking into an audition or job interview, feeling desperate instead of confident.

I have found that it gets much easier to say "no" with practice. I remember one time, really agonizing about how to say that I couldn't contribute as much as others were to a particular gift. It was through text and after a few starts, I finally ended up just saying, "that's not in my budget. I can contribute $x." I got a quick reply that that was no problem, no one made me feel guilty or questioned it and it was done. Now, I only really think twice about it if it's something I really want to do and if so, I look for other areas in my budget where I can skimp or sacrifice to make it happen. Sometimes I do and sometimes I don't. Just going through the process of looking helps me decide how important it really is to me.

A year ago, I wasn't even thinking of going to New York. Vacations were not a high priority for me. But in June, I got an email from Hamilton, offering me tickets for early 2017. I clicked on the link, thinking this will be for nothing. The tickets will be $900 and I'll close the window, delete the email and move on. Except that when I clicked the link, there were tickets in the mezzanine for $200. Well, that's downright doable, I thought!

I called my friend Nancy. Within minutes, we decided to go for it. We picked a day in March 2017, and we bought 4 tickets to see Hamilton on Broadway!  From that moment on, my vacation budget become a huge priority!

We got back from that trip just a couple of weeks ago, and I'm still smiling! Everything went beautifully, and I even stayed under budget! I wasn't even really trying; we went to a couple of fancy restaurants, but we also ate pizza for $1. When it was too cold or we were running late, we took Lyfts, but we bought a week pass for the subway and got around mostly that way. I bought souvenirs, but didn't buy a couple that I just thought were way too overpriced.  I didn't ever feel like I was sacrificing, but I didn't feel like I was wasting money, either. We thoroughly enjoyed it!

And now I'm back to real life, back to saving money for a car - and a few droplets in the Vacation category, too.

Okay, I have strayed very far from the original intent of this post. Bottom lines:

1. Encourage financial conversations with friends. Real conversations, not just moaning about money, but "let's brainstorm on how we improve our financial lives now." And bonus: if you and your friends are all committed to saving money, you may find new ways to have fun together that don't involve spending it!
2. Remain open for new opportunities. Obviously, our trip to NY wasn't what everyone would consider an "opportunity," but it was for me. It was like a dream come true that I didn't even know I was having until it became a reality. And it reminded me that I really love NY and want to go there more often that once a decade!

Balancing your Personal Financial Responsibility

I thoroughly enjoyed Afford Anything's most recent podcast on what they're calling radical responsibility...though it's not as scary as that may sound.

As long-time readers know, there were certainly extenuating factors that contributed to my negative net worth and increasing debt obligations.

My journey as a single mom began when my girls were not yet 3 and 6 and I had no job, car or home to call my own and bad credit. X was (and is) a drug addict that didn't (and doesn't) pay child support regularly. For reasons not necessary for this blog post, I was not yet a college graduate.

After finding a steady job, I went back to school, but to do so, I had to take out student loans. I don't regret that for a moment, but it didn't exactly help my financial situation. After getting my B.A., I realized I needed to continue my education before I could really see a substantial difference in my pay. Enter more student loans.

To be clear, I am not recommending this or dissuading it. This is just where I was.

Then, one day, after financial ups and downs for most of my adult life, I was done. I no longer cared whose fault it was, I just had to make it better.

I stopped focusing on our circumstances and just worked the problem.

Now, don't get me wrong. I'm still a bleeding heart liberal. I totally get that everyone's circumstances are different, and that it may feel like there simply are no choices. 

I am, however, going to offer a different perspective.

Instead of focusing on what I couldn't control, I turned to what I could.

I couldn't count on X giving me child support, but I could re-work my budget to not be dependent upon it - and anytime I did get child support, I would split it between paying off debt and paying for the girls' needs.

I couldn't count on any other sources of income, so I looked to both increase my own while decreasing expenses.

Though many choices felt like choosing between a rock and a hard place, I recognized the choices that we had made. I accepted some, and changed others.

I accepted that I wanted to live in SoCal where the rents are high, but family (and free babysitting) are available. I accepted SoCal rents, but moved when rent got too high.

For a while, we chose to keep cable TV...until we changed our minds. It became a personal challenge to decrease our grocery spending month by month until now, it's a challenge to overspend!

But I think the best thing about taking financial responsibility is how empowered it makes me feel. I mean, I have nowhere near the financial net worth of Paula Pant or Emma Pattee (the ladies on the aforementioned podcast), but I am where I want to be, and I know I am headed in the right direction. Instead of feeling defeated by the problems that arise, I feel like standing taller and saying, "bring it on!" (I mean, not really, but you know what I mean.)

So my X is a deadbeat, so what? He's not worth my anger or tears, either.

When Riley needs something, she's not worried that I'm going to freak out and I am in fact, happy to oblige...because I can!

It doesn't happen overnight, of course. But it does take that moment of deciding that you are up for this challenge. Taking responsibility means that no one else can have it. You get to control your financial destiny. How cool is that? 

1st Financial Update of 2017

I decided to check out my Net Worth report for 2016. I was beyond thrilled to discover that it's grown by more than $10,000! That doesn't include my 401k, Betterment account or my student loan debt. I only track my cash accounts in YNAB, which is where I ran the report.


I expect it to decrease significantly this year because part of that is saving for a new car, which will be purchased this year and for our NY vacation. Also, I may be planning another vacation later this year so I'm increasing my cash savings to spend it later.

So I'm totally okay with not seeing that kind of increase for 2017, but I'm still pretty happy about it!

I've changed my mind hundreds of times about what I'll do when my car lease is up, but I think I've made up my mind that I'll buy a new hybrid. I thought about buying used, but I think I'd prefer to spend more now so that I won't have to think about buying a replacement for at least a decade. As much as I love having the fully electric Fiat now, I want the flexibility of a hybrid. I've got a price in mind that I'm fairly sure is doable and while I'll still have to borrow some, I want it paid off in 5 years max, but I hope to do so in 3.

I've already paid for flights and theatre tickets for NY and have enough saved for food and other recreation. I'd like to get in at least one more show while I'm there, but I will see what's available on TodayTix (use referral code FAGSL for $10 off).

Not sure if I've mentioned here, but Sylvia is currently working on a cruise ship. If she does a second contract, Riley and I will probably take a cruise so I'm starting to save for that.

I also really want to get my student loan debt down. While the interest rate is low, the balance barely seems to move and the site currently says I won't pay it off for another 7 years, and I've been paying it for about 10 now! Enough already! I'll make a more concrete goal once I get the car situation under control, but for now, I'm throwing an extra $100/mo towards it.

I'm also starting to save for Riley's senior year. We've been foregoing on pictures, yearbooks, dances, etc. with the understanding that she'll do it all her senior year...which is next school year, OMG. We recently decided that she'll finish out her junior year before she gets a job, since this is the hardest academic year. She knows that means she won't get a driver's license or anything like that until after she starts earning her own money towards it. Her only "job" right now is to start looking for scholarships.

She's picked her dream school. It's not the most expensive, but it's not the cheapest either. We still don't have anything put away for that, but she's prepared to take on most of that responsibility herself. Mostly, that's next year's problem.

So all in all, 2016 was fairly successful, financially speaking!

1st Financial Update of 2016

You Need a Budget (YNAB) came out with a new program that is web-based, which I started using Dec. 30. Personally, I like the technical changes.

I decided to start fresh, update my categories, and this new perspective showed me that, hey, I actually have spending $$ available! Now, I didn't go nuts, and I'm still pretty focused on building my Freedom Fund...but I also didn't stress about buying new boots when I saw how worn mine had gotten. I didn't stress about buying a new laptop because my old one was going. I planned outings with friends without stressing about $$.

Sylvia's budget has also gone really well (and she too prefers the new YNAB). She decided to start community college and, for the first time ever, got my seal of approval to dip into her Emergency Fund :) Of course, I told her this can't be a regular habit, but given the timing, it was the best option. Now, we have a better understanding of how much she'll need each semester, and can budget accordingly. Neither of us regret that she took some time off before starting school again, and both of us are confident that community college is the right place for her right now.

She is also budgeting regularly for car maintenance, car insurance, registration, gas/parking and her insurance deductible. There's no way she could afford to live on her own right now, but she is developing good habits and staying out of debt.

Meanwhile, Riley and I have started a car/driver's license fund. As with Sylvia, she will have to wait until she has a job before she can really get going on driving (or anything else), but at least we're on the same page about things.

The new YNAB has an "Age of Money" feature. The goal is for the money you spend to be at least 30 days old. Sylvia and I both have "35 Days" as our Age of Money.

I decided to use my most recent 5th paycheck to fund one annual category in full to alleviate the "monthly" budget (as well as beef up my Freedom Fund), which I'll do again with the next 5th paycheck.


I'm also beefing up Theatre Tix to see Hamilton at least twice and Something Rotten on their national tours. And I have a really lofty goal for my Freedom Fund, but it's more than a decade away.

I'm not sure if it's truly financially viable, but it's a really great motivator to continue cutting costs where I can and dream about being able to afford what I really want!

But in the meantime, I'm making sure there are enough funds to not only cover our needs, but some of the more reasonable wants, too.

I think I'm even starting to believe that we are in the middle class after all!

$450? Okay.

On this blog, in this podcast, and in my eBook, I've told the story of how car maintenance changed my budgeting life.

Last week, I spent over $500 on my car...and not a tear was shed, not a freak-out was had, and I even got a little kick out of knowing this would increase my cash back on my credit card this month!

Honestly, I'm not trying to brag, but to point out that having a living, breathing budget makes all the difference.

I wasn't expecting to need 3 new tires at this service...but the reality is, cars need new tires. This is why I've kept $500 in my Car Maintenance category. The total for the tires, oil change and smog certification came to $452 (this is for my old car, not the new).

The other $101 was for my car registration. That came out of my Car Registration category that gets funded every month, based on the last registration fees for both cars, divided over 12 months.

I got somewhat lucky that this happened this month because next month, I get a 5th paycheck, which will mostly go towards replenishing the Car Maintenance category for next time. Because there will be a next time.

And that's my point. Call it the Power of Negative Thinking or Realistic Budgeting or simply getting through life. Kids need new clothes, holidays and birthdays happen every year, and anything of value you own will need servicing at some point. When your monthly budget reflects these realities, budgeting is actually easy.

Sylvia's Financial Update

She now has two paychecks under her belt, and while she made fun of me after the first paycheck, Sylvia was eager to YNAB her second paycheck!

I've been reading Elizabeth Warren's All Your Worth, and taking a page from that, I insisted she first put 20% of each paycheck in Emergency Savings. Sylvia agrees with this method. [required disclosure: Amazon affiliate link - may result in a small amount of $$ for me]

The book goes on to state that your must-haves should equal no more than 50% of your income, and then the remaining 30% can be spent on wants. My must-haves exceed that for sure, but Sylvia doesn't really have any. So we're left more to YNAB's way after that: what does this money need to do before she gets paid again?

We next give the proper funding to Transportation and Spending Money (for lunches - she can make them at home or spend her own $$). Transportation is for the bus to get her to work.

After that, I let her decide how much to put in each of her Fun categories, which are currently Prom, Grad Night, Senior Ditch Day and Shopping. She is also putting some in her Gifts category.

I'm pretty thrilled that she's got the budgeting bug and hope she keeps this up! How I would love for her to do better than me at this from the start and throughout her adult life!

Oh! And Happy St Patrick's Day!

Financial Update: Credit Card Debt FREE!!

I've done it. I've paid off my credit card debt in full! My goal for 2015 was met WAY earlier than I'd expected, thanks to my tax refund!

So what now? First, I'm focusing on building my Rainy Day/Sunny Day funds. I want to build up my Theatre Tickets funds again, and save a separate $1k from my Emergency Funds/Savings for mini-emergencies/unexpected in a category I call "Mayhem." I've seen others refer to it as Gremlins.  Then, I want to build up a new appliances/appliance repair fund (separate from Mayhem and Emergencies). I am hoping these will keep me from touching the real Emergency Fund/Savings so I can accrue that (eventually) to the 3-months, then 6-months, then 8-months savings recommended by Suze. After Mayhem and Appliances, I will focus on getting out of student loan debt so I can really and truly be debt free.

This is going back to the method I learned in The Debt-Free Spending Plan. I'm still making the monthly payments on my student loans, of course, and that won't change. But the interest rate is low at 3.25% so I will keep paying the "minimum", if you will, and build myself a nice, fluffy safety cushion. I know at some point, just as with the credit card debt, I will start itching to be completely debt free - could be next month or in 2 years. For now, seeing category balances increase is what I truly value.

In other news, so far so good with Sylvia's job. She's a bit tired, as she is working 5 days a week while still in school and still dancing and working at the dance studio, but she's happy, and I'm proud. Riley and I are spending more time together in the kitchen, which we enjoy. Our family time with all 3 of us is getting more and more limited, so we just enjoy it when we can. (It's also nice that the girls are enjoying their time together more now that there's less of that, too!)

Oddly, it's not giddy excitement I feel that I'm consumer debt-free, but rather, content and relief. Unlike previous times, I'm pretty confident that I have slayed the credit card monster for good, so I thought I would be jumping for joy. Okay, maybe I am not as confident as I'd like to be, but that's exactly why I want to hoard as much as cash as possible for a while. I know how life goes.

Still, I feel like this time is different mostly because the girls are so on board with me. They've been totally supportive of every step I've taken to better our financial future. They offer to pay for their wants upfront, they agree that I need to make my own retirement a priority, and they stay within the budget. It might be too much to hope that they'll live a better financial life than me from the beginning, but at least now, I have more confidence that I can be of value to them if they turn to me for financial advice someday.

And hey, they'll also know that I have been there, done that, for almost any financial mistake they could make!

My First Year with YNAB

Thanksgiving last year was when I started YNAB, and I am so happy I did!

In the past year, I've met the following financial goals:

• Got buffered, meaning I'm living off of last month's paycheck. I am officially off the paycheck-to-paycheck cycle, and it makes a huge difference! Like, being able to change the day I go grocery shopping without having to wait for the next paycheck.
• Paid off half my credit card debt! I didn't think I had done that much, since it was more important to me not to incur any new debt and I wasn't really focusing on the old debt. I'm pleased with the progress. 
• Bought the Newsies tickets. Believe it or not, it was a goal of mine to have the funds available the moment tickets were available for purchase. Mission accomplished. 
• Purchased renter's insurance. There is a sense of comfort in knowing that the few assets I do have are covered if the worst happens. And when I finally looked into it, I was pleasantly surprised to realize it was less than my Netflix subscription. 
• I was prepared for every annual bill - car insurance, Costco membership, Amazon Prime membership, car registration. Nothing surprised me this year. Along with that, I was prepared for every birthday and other gift-giving event. 
• Moved without incurring new debt. And moved to keep my monthly rent from increasing. 
• Canceled cable. And so don't miss it. I'm all about the binge-watching these days. We're still following a few shows through HuluPlus, but I spend most of my viewing time on Netflix or Amazon, watching a series from beginning to end. I also spend a lot less time watching TV, and more time listening to podcasts. 
• Paid for every car repair/maintenance without incurring new debt.
• In fact, haven't incurred new debt in close to 2 years now. 

But not everything's perfect, not even financially speaking. I am nowhere near where I should be in terms of emergency savings and retirement. I really have nothing to put towards the girls' college education. And now that I've bought the Newsies tickets, my theatre ticket category is sadly at zero. Plus, Riley would very much like to go on a school field trip to France her senior year. I can't seem to get that category going.





But first things first. My main priority will be paying off the credit card debt. Now that I know I can pay off 4 grand in a year, I want the remaining 4 grand gone as soon as possible. Mathematically, I know what I need to pay each month to make that happen, but I still haven't quite figured out just how. So I'll take it one month, one payment at a time. There will be a few 5-paycheck months, a tax refund, and maybe some other windfalls to help me along.

I don't even want to make any other goals until my Pre-YNAB debt is zero. I have learned that I can easily overwhelm (and depress) myself trying to meet too many financial goals at the same time. I'll continue to build my emergency savings and invest in Acorns, but other than that, I have to keep it simple.

Financial Update: 2013 Review and 2014 Goals

So 2013 was the year that I began to take control of my financial situation. While we have been emotionally thriving as a single parent family,  financially it's been a paycheck-to-paycheck slog.

In March, I started a new plan. When I first started, I thought it would take me until this month to pay off my high-interest credit card. Instead, I did so in September. Looking back, I think the reason I didn't feel elation was because while I had made significant progress, I knew I was somewhat stuck.

I started seeking out more personal finance info and in November, came across You Need a Budget. The first few times I read about it, I thought, well that's great, but I have a budget. But, as the founder always says to wrap up his podcasts, I hadn't budgeted like this.

As of January 1, 2014, I will be living on last month's income. And I still have a Baby Emergency Fund, as I have come to learn is a Dave Ramsey recommendation of at least $1000. (Still not a Dave Ramsey fan, but since I already had that - I considered at least one goal complete.)

This Christmas was the first in 10 years where nothing was put on a credit card. And everyone seemed happy with their gifts. I also did something I would not have even considered just a few months ago.  I canceled my DirecTV.

It's just been a couple of weeks, but the girls and I are all quite content with the decision. I did subscribe to HuluPlus, but even with that, I'm still saving over $75 a month.

I am un-stuck.

There is still a long way to go. Sylvia has started driver's ed, and insurance will be a new (expensive) bill soon, there is still the low-interest credit card debt of about 8 grand to pay off, and I need to accrue more Rainy Day funds for car repair, unexpected expenses, and also to fund fun. 

So the 2014 Goals, financially speaking, are:

1. Let the emergency fund continue to build and forget as much as possible that it's there. A (very) small portion of every paycheck goes directly into my savings account so I can't really touch it without transferring funds. That helps.

2. Continue to live on less than my income and focus any "extra" funds towards the car maintenance and car insurance Rainy Day funds.

3. Continue to pay the monthly minimum towards credit card debt, plus 1/3 of any income outside of my weekly pay (child support, tax refund, etc).

4. 1/3 of any extra income will go towards car maintenance and insurance funds, and the last 1/3 to the girls and fun. 

That's it. I was going to add more, but I want my goals to be reasonably achievable. As each month passes, I will check my YNAB reports, category balances and see if there are any other cuts I can make to the budget, unexpected expenses that need to be added to the plan, and adjust accordingly. I look forward to this time next year to see where I am.

If you would like to buy YNAB (or download a free trial), please use my referral link. You'll get a discount and I'll get a referral fee. (The link is also on my home page.)

Financial Update: You Need a Budget

Instead of blogging about budgeting, I've been searching out personal finance blogs. This one software program, You Need a Budget, kept coming up. I ignored it the first few times because I thought, hey, I have a budget! But then I couldn't help myself. And I'm really glad I did.

I don't want to sound too much like a sales pitch (though that link will get you $6 off and the software is on sale til end of day), but here are the reasons why I decided it was worth it for me:

• I can see the big picture. Yes, the Magic Little Notebook was great for ensuring that I budgeted enough for all my bills, but it wasn't user-friendly when it came to making decisions about anything left over. With YNAB, on one screen I can see everything and easily make changes as necessary. 
• I was already following the first 3 rules for the most part in the YNAB method; spending less than what I earn (Rule 1), starting to build Rainy Day funds (R2) and rolling with the punches (R3), but Rule 4 was a brand new concept for me that breaks the living paycheck-to-paycheck cycle: live on last month's income. Of course, this doesn't happen overnight, but thanks to the savings I already have, I believe that I should be fully buffered (using YNAB terms here) by the end of this month!
• I can enter purchases on my iPhone, my Kindle or in the software on either of my pcs (and I don't have to carry a notebook around). And there's a reconcile feature so that I can make sure that the bank and I match up. I'd been doubling up entries in both the notebook and the check register and then of course, reconciling at the end of the month with the bank. There was a time when there were two check outstanding for MONTHS. I hated that because I always had to make sure I remembered that! With YNAB, once I've entered it, it is gone for good from my available income, and then whenever they did clear the bank, I could just mark them as cleared and move on with my life. 
• I love their classes and forums! I am not the only one obsessed with budgeting. At the forums, there are a ton of us :) And YNAB also has free classes (including two email courses). I started with their 9 day email course and reading articles and after I took the first class, I could see all the benefits of the software, so I decided to go for it.
• Once I'm fully buffered, I will be able to stop the madness of dividing each monthly bill by 4 to save enough each week. Instead, at the beginning of the month, I will be able to enter all the amounts, know they're covered, and then determine which of the other categories need a little love.
• I can change, add, and hide categories. YNAB reminds you that there are lots of expenses that do not come up every month. When you're first starting out, you'll most likely follow Rule 3, which is what I did when I remembered that my AAA bill was due this month. I created another category strictly for AAA and then moved some funds from the Car Maintenance category to cover it. But it was worth creating the AAA category so that I don't forget next year! 
• I can also create notes for each category, which I'm doing for the bigger annual bills so that I can determine how much I need to budget each month before the big bill (car registration, for example) is due.
• YNAB version 4 seems pretty new so I think it will be a while before the next version, but I believe they do offer a discount to current users to upgrade to the next version when it becomes available. And they have been around long enough that I feel confident that it will be around for a long time to come. 
• You do not have to enter any sensitive information. If you would like, you can import bank statements into the software, but you can do it all manually if you prefer (which is what I do). 
• I can track, budget and run reports all in the same place. I was budgeting one place, then tracking in 3 different places so that I could have reports, too. 
• My mom will like the way YNAB treats credit cards, too. For me, I'm using the pre-YNAB debt feature, which keeps track of the outstanding balance as I pay it down. But YNAB doesn't insist you never use credit cards again; it just helps you use it/them most effectively.

I've created a Journal in the forums at YNAB (under the name aprilabtbalance), so I will try to keep the financial updates here to a minimum - and maybe find other things to blog about here!

Budgeting Update: Finally Following the Rules

I don't buy a lot of books, but I have never regretted the $6 I spent on The Debt-Free Spending Plan. Every time I start to feel stressed out about my plans, I read it again. And realize that even though I think I'm not guilty of the "shut down" that Nagler often refers to in the book, I did shut down on some parts. So almost every time I read it, there is still more for me to learn and implement. And here's the Full Disclosure about that link being associated with my Amazon affiliate account, which may generate a small income for me...that may be enough to buy another $6 book in two or three years!

While she stresses the importance of ensuring that Savings, Fun and Entertainment are part of the budget, I realized that I only had two of the three. I now remember that I combined Fun and Entertainment into one.

As I continue to pay down the balance on my remaining credit card, I've been going back and forth (in my typical can't make a decision fashion) on how or if to re-jigger the budget as my minimum balance decreases. At the same time, my daughters are getting older and Sylvia is old enough to get a driver's license, but I'm in no way financially prepared for that!

I do feel pretty strongly that since driving is a privilege, not a right, she should be contributing towards these costs, so she's been pounding the pavement looking for a job. At the same time, I don't expect her to cover all the costs.

So, after weeks and about a half dozen ideas on what to do, I re-read the book and that helped me make some decisions.

Because I've been stressing so much about the car situation, I've created a Car Repair line item in addition to the Car line item, which is mainly budgeted to cover gas and parking, but I had also been using it for maintenance. Nagler does state in her book that if your car is not under warranty, then she suggests $80 monthly for Car Repair. Originally, I had thought about adding that when my credit card minimum reaches a certain threshold, but using some Suze Orman advice to address what fears me most, I decided that I would feel better if I did it now. It might not help me next week, when I suspect my car will next be due for maintenance, but getting into the habit now is better than waiting even one more week.

I had also toyed with the idea of adding more categories, because I think I generalize too much and then justify some expenditures, and then regret them, or at least question myself about them. But again, instead of waiting until the minimums go down, I was able to split some categories in half so that these "sub-categories" (so to speak) would get some attention sooner rather than later.

For instance, I was really excited about starting a Theatre Tickets fund (i.e., our kind of Entertainment). I had originally thought that I could use the Fun category for that, but we kept finding other fun activities to do. At the rate I'm going ($5 a week), I still won't have enough in there to cover the cost of Newsies tickets when it comes to town, but I will be that much closer, and we can still have some non-theatre Fun in the meantime.

Vacation isn't as important to us. I am perfectly happy to take some staycations for R&R, and the girls travel more often than I do with my parents. But I do think fondly of places I'd like to go again; San Francisco, New Orleans, New York, to name a few, and places I still haven't been to that I would like to visit one day (Hawaii, Australia). But since it's not as important to me as the car and theatre, then I will wait until my credit card minimum meets a certain threshold before I start putting $5/week into that line item.

I have not had a Clothing line item. I figured I could take from other places for that, but again, that's not really planning. Clothes aren't really important to any of us, but are necessary, so that line item is only getting $4 a week and we'll continue to buy on an as-needed basis as we do now. That $4 is coming from the Presents line item, which can now be decreased a bit since I've completed 80% of my Xmas shopping.

I've previously bought miscellaneous household items using funds from either Groceries or Miscellaneous (things in the non-food grocery aisles). I decided there are enough of these type of needs that Household deserves its own line item, and will grow it at $5 a week (which I got from the Miscellaneous category).

My duties as a non-profit Board member sometimes include expenditures that I can't budget so when my credit card minimum balance goes down, I will start a Donations category at $5/week.

As my credit card balance decreases, I will also add New Car and Short Term Savings line items to my budget. I am hoping that the Short Term Savings will keep me from dipping into my long-term savings account as often. As Nagler says, it's important to have these multiple accounts to pull from when the unexpected happens, and so that's what I'm trying to build now that I kinda sorta have my daily budget under control.

*Note: Nagler states that we should open separate Savings accounts for many of these line items (Car Repair, Short Term Savings, etc.), but I find that it's just as easy to track in the Magic Little Notebook - and saves me from worrying about transferring if/when I want to access them. Of course, they might be too easy to access, but I am hoping that having that many more line items means that I will be more interested in building those than depleting them. Then again, I may change my mind again after I read the book another 2 or 3 times!

Budget Update: Holiday Shopping

I've just discovered that my favorite personal finance book has a blog! This entry covers holiday spending; my approach was slightly different, but I'm in roughly the same place.

We have 4 family birthdays in October, 1 in November, a friend's birthday in December (she's pretty much the only friend to whom I give an actual present), and then of course the holiday gift-giving. So I started thinking about the holidays a few months ago.


Where I did things a little differently is I first estimated how much I was willing to spend on each person, and made that total number my budget. Then I started putting any extra money from 5-week month paychecks (and anywhere else) into the Presents line item, and started shopping.

As author Nagler suggests, sometimes I went slightly over but other times, slightly under so it has worked out well (so far). I have crossed off nearly everyone on my list and still have money in the Presents line item.

The only place I went over was in planning celebrations for the girls' birthdays so I did use some from savings to cover that, but since Presents is now a permanent line item in my budget, I am improving my chances that I won't have to do so next year. 

My sister reminded me about ExpenseRegister, which I'd stopped using a long time ago. Then I realized that it was the easiest way to meet my next goal of tracking. I was trying to do it by keeping a log book, but I was forgetting to do so on a regular basis, or wouldn't have it with me when I wanted to do it. Since ExpenseRegister can be accessed from anywhere (and it does not keep any personal account information), I can easily add expenditures and run reports to see how I'm doing.

This doesn't mean I don't still obsess and worry and fret about money and what will happen if my next car service costs $1,000. I still have a long, long way to go. But I'm not so much worrying about the holidays this year, which is totally a first for me!  

Obsessed with Budgeting

*I had not yet completed this draft, when something unexpected happened. But rather than start completely over (and before anything else happens) I'm going to update this post with comments in italics. 

One of these days, I might have something to talk about other than my budgeting strategies. But not today.

Every so often, I go to my now-paid off high-interest credit card account just to see the 0 balance. It helps.

I also re-read some of the book that started this whole thing. I realized I was missing an important element: clarity.

While I have been inputting every dollar into the Magic Little Notebook, I'd tear out those pages when they filled up and kept my eye on the bottom line(s). Now I have a ledger-type notebook where I track every expense in its true budget category and then total the monthly expenditure. It will take a few months of doing this, but then I will have clarity. Am I not budgeting a category adequately? Am I overspending? Even though I never go over-budget, I still borrow from one category to pay for another at times.

I also made a few more changes. Every so often, I would use the Miscellaneous account to buy myself something, but I'd go back and forth from feeling guilty about it to feeling entitled...and then back to guilt. In the end, I decided to give myself a weekly allowance, just like the girls get. (The same amount, even.) And I added yet another budget item for Major Purchases. We still have tube TVs and the color is already out of whack on one of them. Eventually, while we won't need it, we will want a new TV when it completely goes. And what if the refrigerator dies? If it happened tomorrow, it would have to come out of savings, but wouldn't it be nice to have it covered from its own account? It will take quite a few months for it to be funded enough to actually cover a cost like a new TV, but we have to start somewhere. I'm starting with $5 a week. *The TV did completely die. $5 wasn't enough to cover it, and I had to take it from savings, but it validated the need for this new line item.

I canceled the DVD aspect of our Netflix account and decreased the Miscellaneous category to cover these new items. The DVD queue was all made up of movies of my choosing and I've generally used the Misc category for household expenses; now the numbers have just been re-organized.

Oh, and for those that think we shouldn't have any Netflix account whatsoever (or immediately buy a new tv), I get it, I do. But I also get that complete deprivation does not, in the end, work for me or my family. We all enjoy Netflix at the end of a long day, and it's a relatively cheap form of entertainment. It's $9 a month. I may not be rich, but I can afford that. While I may have had to dip into savings to buy the new TV, it helps tremendously when the 3 of us can't agree, or just need some alone time. For our peace and sanity, it was totally worth it. And I bought the absolute cheapest (and smallest) new TV I could find.

I've changed my mind about 27 times on what to do each time my credit card monthly minimum decreases by $20. I'm committed to putting that first $20 monthly into the Car category so that I can slowly continue to build that back up again. After that, I think about adding new categories like short-term savings or vacations, or adding to other currently existing categories, but I keep re-thinking it. It will probably take a few months before that will happen anyway, and hopefully by then, I will have the clarity from the long term tracking notebook to make thoughtful decisions.

The really good news is that I have put together a Presents budget for both upcoming birthdays and Xmas, and I'm fairly certain I will be able to fully fund the budget without dipping into my savings! (See? I don't even mention the credit card anymore!)

Financial Update: Two (small) Steps Forward

I expected to feel elation. Joy. Or even relief.

I paid off the high-interest credit card. I got to click that button that says to pay the entire balance. I've been thinking about this day for weeks. In the days preceding, I was looking forward to the glee I expected to feel when it was done.

Instead, I felt (as the song goes) nothing. Except curious why I didn't feel more.


Maybe because last time, I felt too much elation and then deep despair when I had to use it again. While I feel fairly confident that won't happen again, I think that must be it. Not fear necessarily, but a need to keep vigilant.

There are a lot of family bdays coming up, and then the holidays. And the Car account, while not completely empty, is not quite plentiful, either. 

And a few weeks ago, I did something that might sound crazy. I finally upped the amount of my retirement contribution to get the full 4% match my employer offers, and that decreased my weekly take-home pay by $26. When you're living paycheck-to-paycheck, that makes a difference.

I've been avoiding this for too many years, though. I was losing a lot more money in the long run than $26/week. Still, the reality of the harsh difference reminds me that I still have a long way to go until I feel financially secure.

While in years past, I would've taken the amount budgeted for the high-interest credit card towards paying the remaining credit card, in my new plan, that's not the recommended path. Instead, I am using some towards building a Presents account, adding a little more to my grocery budget (a line item where we've been most likely to go over), and a little more to the Fun category.

See, here's the thing about only paying the minimum and not adding to the credit card balance. Eventually, that minimum decreases. At that point in time, I don't actually decrease the budgeted amount towards the credit card so that even this month, I'll be paying slightly more than the minimum. And my X has been a lot better lately about sending me child support, so I use some of that towards credit card debt which also helps.

By adding budget items, I am more likely to stay in budget and not add to my credit card. Especially with all the gift-giving that will be going on in the next few months, I will probably still dip into my savings, but at least it's not the credit card. I have recognized that my grocery budget wasn't high enough, so I'm funding that more appropriately. And, yes, I'm even treating us a little bit by adding to the "Fun" category (only $3 a week, but proportionately, I'm okay with that).

Progress may be slow, but I have now accomplished two important financial goals. By paying off one credit card and meeting the contribution match, I am starting to step slightly beyond merely paying bills on time. I am starting to build a financial future. 

6 years later...

I'm still a blogger.

Maybe not as frequently, but I'm still here. 

Today is my 6 year blog anniversary!

I've done several posts already reflecting how grateful I am to be part of the blogosphere, so I won't dwell. I'll just blog.

Continuing my financial update...

When summer began, since I didn't have to allot $$ for the girls' school lunches anymore, I made both a "Sylvia"  and "Riley" line item to my budget. They also get a portion of the child support that I receive from X if and when he sends it. I knew that since I was producing the musical, and still working full-time, I would be gone from before 8 a.m. and get home close to 10 p.m. every weeknight. Which meant there'd be little time or energy left for household duties.

Previously, I've tried to pay the girls per chore, but it was just too much trouble. Instead, we made a deal that they would each get $20 per week for doing pretty much everything I told them to do.

I didn't have to do laundry all summer, and man, that was heaven for me! They also did dishes and other daily tasks, which was a big help. And they didn't use all their cash.

I've sat down and shown each of them my Magic Little Notebook so that they understand how I keep track of everything. They would ask for $10 here and there to go to the movies or eat out, but they both did a great job of keeping their own notebooks to track their "accounts."  Mind you, I did not tell either of them to do so; they just did it on their own. (Proving, once again, they learn from our actions and not our words.)

I also explained to them that some things were going to have to come from their accounts, like new school clothes and supplies. They both did an excellent job of finding things that they really liked that fit within their budgets. They also learned the actual cost of going out after a performance, since I would allot their portion of the bills from their accounts. They grumbled a little at first, but understood. 

I used to worry that I was running out of time to teach them these kinds of money lessons. Turns out that just being open with them about our household finances and involving them did a lot more than I expected. 

Sylvia wasn't crazy about the fact that I did take some of the costs of her art supplies (which ended up totaling $255) from her account, but after reminding her that I spent three times more than she did, she has accepted it. She tends to let her account dip very low, so I've implemented a rule that they can only take out half of what they have. (She wanted to spend her last $20 so I told her she had to wait until the following week when she would have another $20 in there.)

Riley started saving of her own volition because she wants to buy a laptop, so she only takes out small amounts.

We depleted my Miscellanous, Fun and Dining Out buckets almost completely going out with friends after shows and grabbing a bite on the way to the theatre, but we are slowly working, one paycheck at a time, to build them back up. At least it didn't go on the credit card, which again, is better than last summer! We'll see where we are next summer, and just hope it continues on the upward trend.

Thanks for being here to help me celebrate 6 years of blogging! Hope to still be here next year, too.

Financial Update: The Car Saga Part Umpteen

I've written many times before how maintaining my car has been a major stumbling block in my hopes and dreams of getting out of debt.

I've been working my new financial plan for about 6 months now and the real test came last week when it was time for another oil change/maintenance check/smog certification.

After a few weeks of working the new plan, I figured out that any money left over in the car budget every week should stay there. For just these occasions. Since I didn't have to make the commute for the girls' schools over the summer, that money added up. I knew I had over $800 and that would pay for the expected costs (he'd already warned me I would need struts - or something. To tell you the truth, I zone out on the actual words and just focus on the amount, which had been quoted around $500) and my smog check, but one never knows. Or, at least, I don't.

I think he was really surprised to hear my sheer delight when the amount came to $620. Not only could I pay that, I can also still pay for the car registration and still have a little left over in the Car bucket! That is the first time in ten years that I've been able to pay a bill like that completely out-of-pocket.

I'm telling you, this budgeting thing works.

Now, I'm still keeping a realistic outlook. I'm already concerned about the next one since I am back to the commute and won't be able to accumulate quite as much in the Car bucket as quickly. And right after that, I ended up having to take $200 out of my savings to pay for Sylvia's art supplies. Every time I get just past one-month's worth of living expenses saved, something happens where I have to dip in there. But last year at this time, both of those types of expenditures would've gone on the credit card.

I have not used either of my credit cards in over 6 months. My monthly minimum just dropped $50 on my highest balance credit card (with the lowest interest rate), and I am less than $100 away from paying off my high interest rate credit card completely. Again, I know, but I think this time it really might be for good.

Another big change. I finally had a friggin' "a-ha" moment which I should've had a year ago. I'm lucky enough to work for a company that offers educational reimbursement. But it is reimbursement. I have to pay for the classes, the books and all that up front, and then after I finish the class and get my grade, I can submit for reimbursement.

In the past, I have used that $$ towards credit card payments and stuff, but then, I finally got smart and put it away in another account entirely and then, used it to pay for this semester's costs. I feel incredibly stupid that it took me this long to figure that out, but at least I did and that's another expense that got put on the credit card last year that I was able to pay out-of-pocket this year. (And this should be my penultimate semester.)

There's more to say about working this plan, what the girls learned about $$ this summer, and such, but this post is long enough as is!

Budgeting Update and Financial Guide

Sylvia and I agreed it was worth it to make her lunch every day instead of buying the school lunch, and start saving that money towards other things. And just in time. Just spent $80 for items needed related to her upcoming dance recital.

Riley still gets her lunch at school, but since the year's almost over (yay!), I am now putting that money towards a "Riley" line item, and will use it for next year's school uniforms and some summer clothing needs. She has also agreed to do the laundry over the summer, and I have agreed to pay her for that. Because it's totally worth it!!

I am getting child support again (sporadically) so I am splitting that money between Sylvia's line item, Riley's, Transportation (I just spent $500 on my car - again - and have already been warned that another $500 will be needed in a few months), Miscellaneous (which is used for household needs and presents), and paying down credit card debt.

My dad advised me to keep track of how much I'm spending on the car over a 12-month period, and then see if it's more or less than a car payment would be. The car is 12 years old now, has close to 150k miles on it, but it is a Toyota so everyone keeps telling me it should last at least another 100k miles. Yes, but at what cost? To be continued...

In the meantime, I was offered the opportunity to review Financial Guide for Single Mothers by the author, Amit Eshet. After 10 years of single motherhood, a lot of the book covered information that I have already learned (and, admittedly, some of it the hard way), but I do think it is a great quick-reference guide, and would be useful for single mothers just beginning their journey.

While I appreciated that Eshet was forthright about most financial institutions being in the business of making money, I was surprised that Eshet did not recommend a credit union in this chapter. I am constantly grateful for the opportunity to be a part of a credit union that offers me a low-interest credit card, and superior customer service.

Also glaringly missing from the book, when talking about the importance of saving money, Eshet did not point out that it is so much easier to save when you have a portion of your paycheck deposited directly into your savings account. Most employers will offer direct deposit, so it is always worth asking.

While much of the book would be useful to anyone, regardless of whether single or not or a parent even, Chapter Eight: Financial Education for Kids will be particularly useful for single parents. Eshet includes a breakdown of age-appropriate financial concepts, even beyond the age of 18. I wish I'd had this chapter when my kids were younger! But I will hang onto it and go over it with the girls.

I was offered the book to review for free, and the author has informed me that it is currently available for 99 cents at Amazon (and the link above is connected to my affiliate link, so I would receive maybe half a cent?) for a limited time.

Budgeting Update: The Grocery Line Item

I don't think I've ever gone into detail about my grocery budget.  (So what if Financial Literacy Month is over?)

A few years ago, I started an excel spreadsheet that is now almost 1000 rows long of each item I buy, quantity, and cost per.

I menu plan first. And I almost exclusively cook in the slow cooker. I've accrued quite a few recipes through blogs, websites and books. Then I heard that emeals was now offering a slow cooker option, so I re-joined. (No, no referral fee or anything. I know, I'm so bad at trying to monetize this blog!)

I keep my grocery list in a note on my phone so that I can add things during the week as we run out.
On Thursday or Friday, I put together my menu for the coming week and finalize my grocery list. Then I go to my grocery budget spreadsheet.

It has been built one grocery trip at a time. It started with estimates of how much each item cost. Now, I take each receipt and update the spreadsheet with the actual amount spent for each item. Here in CA, we're not taxed on food items, but I do buy more than just food, so I go ahead and multiply the sub-total by the tax rate to come up with a total. I try to use coupons, but I don't always remember to do so, so I do not deduct any coupons from that total. Of course, if the total is over my budgeted amount, then I have to re-think my planned meals or forego a desired, but not needed, product or two.

8 out of 10 times, by putting together my list this way, I spend less than I have budgeted for my groceries. This week was one of those weeks where I went over. By seven bucks. Oh, well. It happens. I subtracted the overage from my "Miscellaneous" line item on my budget.

Previously, I've tried to keep track of my spending while shopping, but that's not nearly as reliable or efficient.

I also only shop once a week. If I forget something, then that recipe will just have to wait until next week. (Though, admittedly, it's not necessarily out of principle; it's more lack of willpower.) I usually have spaghetti or other easy items on hand to make do.

Every so often, I will make a trip to Costco to stock up. I also have a Costco shopping list tab in my grocery budget, but I do not dare rely on that alone. On Costco trips, we keep the calculator tool open on the phone so we can add as we go. I also compare and have found on some items, it is cheaper to buy at the grocery store than Costco so I know which items to leave off the Costco list. I'm proud to say, I have actually left Costco for less than $100.

I am absolutely dreadful at actually using left-overs, so I could still do better when it comes to saving money on groceries. And I wanted to kick myself when I came across a book of coupons from my grocery store that had already expired before I opened them. Still, I do have to balance my free time with saving money. Overall, this method is working for us.

Financial Literacy Month: Changing My Financial Attitude

I've been watching The Suze Orman Show for a few years now, and credit her greatly for getting me on a better financial track. So I was surprised when I found myself disagreeing with her recently.

A caller asked whether or not they should use an account that had been gifted to them to pay off their credit cards. Suze's answer was based on interest rates, which, sure, makes financial sense, but I was surprised Suze didn't explore how the credit card debt had been incurred in the first place.

After having been there, done that, at least three times in the past 10 years, I know that just using a large chunk of money to pay off credit card debt doesn't mean I'll never incur credit card debt again.

And that's been the biggest change in my financial attitude recently.

As much as I've wanted to believe "never again," the biggest financial hurdle has been having to do things I never wanted to do again.

In November of last year, when I had to charge my car repairs again, I was thoroughly bummed out about it. Then, right after the holidays, I had to pay for my textbooks, another expensive item that could only be charged. I felt like I was right back where I had been three years ago, and that did not feel good at all.

It completely wiped out all the joy and freedom I'd felt just a month before, when slowly but surely, I paid down a balance the hard way...one paycheck at a time.

I started looking into second jobs or freelance work - not really viable when I only have about an hour to myself daily a few times a week. But then school started, I was busy with that and my non-profit stuff and work and kids, and I just resigned myself to being in credit card debt for the rest of my life.

I was pretty sure I'd be putting even more on the credit card during my trip last month, but then I came upon the Magic Little Notebook method. While I did take some out of my savings, I also took some out of other weekly budgeting items that I would not be needing since I was out of town, and came up with an overall budget, plus a daily spending plan for my 6 days away.

I would check my progress every night. The first day, I spent less than I had budgeted, which meant I could spend more for the rest of my trip. Same for the second day, and then again, the third. I went the entire week without incurring any credit card debt.

My progress is slow, for sure, but what's most important is getting used to not using the plastic crutch. And also changing my attitude so that if I do need to use it, I don't get completely bummed out and fall into a vicious overspending cycle.

Interestingly, on that same show, Suze said her show is more about relationships than just money. I totally agree. I am working on changing my relationship with money. I am working on feeling like I am in control of my credit card debt, rather than letting my debt control me. I am working on feeling powerful over my own paycheck, rather than feeling powerless over the money that goes out. I have long taken pride in being able to pay my bills on time, and now I can take pride in watching my savings (finally!) start to grow at the same time the credit card bills decrease. And, we shall see that, if the next time I have to use the plastic for a bill that's bigger than what I have, I can at least feel grateful that I have the credit card as an option.

There will always be those with a lot more than what we have, and I'm good at not trying to keep up with them. What I need to work on is recognizing that we have a lot more than others, and all things considered, we're doing pretty okay.

Budgeting Update: Financial Literacy Month

I've been using the debt-free Magic Little Notebook for over a month now, and the best thing I am getting out of it is how to change my attitude so that I can continue to (1) pay off my debt, a little at a time, (2) build up my savings, a little at a time, and (3) play with my budget when I find myself straying.


I have already revised my budget items a few times. Beyond merely just building up my savings account, I am attempting to create cushions in the areas where I know expenses will only continue to go up faster and greater than an annual salary increase.

For instance, I started off budgeting my usual $80/week in gas - the amount I was spending when CA gas prices were at their highest. While I'm not spending that now,  I wanted to make sure I kept it at a level that I might have to spend, since we don't have any alternatives to our daily commute.

For the first couple of weeks, I took the excess and funded other more fun areas of the budget. But then I realized, I should re-name this line item "Car" so any amount over actual gas can start going towards car maintenance and repairs. Most likely, I will still have to dip into my savings from time to time, but hopefully not as much as I start to build that amount.

Speaking of savings, I can't explain exactly how it happened, since I only budget $25 a week for savings, but I still managed to grow my savings by $200 in one month. That even includes a momentary lapse where I put something on my credit card!

The very next day, I felt so bad about it that I transferred the $50 I'd spent to my credit card from my savings. I've previously used a lapse as an excuse to just keep spending blindly, but by being able to pay it off immediately, I felt like I really hadn't lost any ground and could just keep going.

There is one line item amount where I go over every week, my Dining Out category. On any day that I don't have lunch plans, I bring my lunch but, being a single working mother, lunch is usually the easiest plan to make with friends, and I sometimes have meetings related to my Board commitments at lunch time. I just can't resist it.

While I ask myself every week (around the time that I go over) if I should just increase that line item, I manage to find the amount I've gone over somewhere else. Other categories are over-funded to a certain extent because I divide monthly bills into 4 weeks and there will be a few bucks left over here and there or because my gas or electric bill aren't as high. So I leave the Dining Out category amount as is, and then just find the money (but not from the Car line item).


I am learning to resist from time to time. There was a recent lunch event that I was invited to, but I knew it would go way beyond my Dining Out budget. Not just a few dollars, but like double the amount. So I declined, and said that my budgeting wouldn't allow it. No one tried to coax me to change my mind, nor did they make me feel embarrassed about it. The truth was accepted by everyone, but most importantly, by me.


And while it's not a lot, I'm paying at least $15 more than the minimum required for both of my credit cards. If I just keep paying the same amount I've budgeted without adding to the balance, eventually that will turn into $20 more, then $25 more, etc. I'm still not convinced I will ever not have a credit card balance, but that realism should help me (not literally) die a little less next time I have to use a credit card.
 
I am also building the "Fun" and "Miscellaneous" categories. They are great to have when Riley needs new uniform pants or we want to buy an iTunes song. Still, I am most proud that I am funding them more than I'm taking from them. I just need to make sure that stays the case as much as possible. 

There are still some things that frighten me - like having to pay a car payment or buying Sylvia a prom dress. I'm skeptical that my turtle-like time table will be quick enough for what may came up. But there's only so much I can do, and there's only so much I can stress about the unknown.

For the past month or so, nearly every day, I feel like I am making the right decisions and doing the best I can with what we have.