Question and Answer Weekend: Holidays and Houses

http://www.popgive.com/2010/01/snow-monkeys-in-hot-springs.html
Hopefully your holidays were as relaxing as this snow monkey’s!

 Heyo Readers!

I hope everyone had a safe, peaceful and relaxing holiday season.  Holidays are often taxing-especially on our savings accounts and sanity; gifts, travel and holiday celebrations are expensive.  Hopefully we all found ways to minimize the excess in our holidays and exchanged it with inexpensive and genuine ways of showing our holiday spirit.  This holiday I utilized the skills I’ve developed over the past few years of balling on a budget and I’m happy with the results.  I Grouponed, Goodwilled, selectively shopped (in terms of items and stores), budgeted, bartered clothes, negotiated prices and inventoried.  Ideally I saved myself some money, but at the very least I did what is at the essence of Balling on a Budget:  I participated in our marketplace a little bit more consciously while worrying about my money a little bit less.  How did you minimize the financial stress of the holiday?

This weekend’s Question and Answer contributor tells us about the pro’s of owning a home and reminds us of how easily we can regret our financial choices. 

Enjoy!


 What financial decision are you most proud of?

Buying our house. I know a lot of people think that houses are nothing but money pits, but a family of five renting a home in a good school district is an expensive prospect! Once we bought a place, it was wonderfully relaxing to know that all the time and maintenance we were spending was going to our own investment. While I know it costs me more money, the peace of mind that ownership has brought was well worth it. And in the long run, it’s an asset that won’t significantly devalue (although I know that it may do so in the short term) which means that I can potentially start to use the equity in the house as a way to fund things in the future (three kids through college for example!). 

What is your biggest financial regret? 

I moved from a small town in Canada to Denver, CO to take a job in a small company. I had to pay to move my whole family, along with costs of flights back to the UK in order to get visas for everyone to come to the USA. All in all it was close to $20,000, which was all of our savings. Three months later, the job didn’t work out and I got a role at a much bigger company in Seattle – they paid for my family to move out, and covered all the flights (including the extra ones related to visas and all the visa costs). I really regret thinking that covering the costs for all of those things was a worthwhile use of all my savings. If instead I had stopped to think and apply to the larger company first I would have kept all my cash. Big companies often come with better benefits and compensation, and while it may not be as exciting or rewarding as working for a smaller company (where maybe you can make a bigger impact) it was eye-opening to me that I could be looked after in this way.

 

Question and Answer Weekend! Shop in your friend’s closets!

chimp dressed upHey Readers!
Today’s contributor shares a great way to get balling clothes on the cheap:  ask a friend!  I’m not sure about other places in the country, but clothing swaps are a pretty big deal out here in the Pacific Northwest.  On any given Saturday you can find organized clothing exchanges where women around the city come together and swap their goods.  If you’re not comfortable wearing second hand clothes from people you don’t know, then go ask your friends! As someone who had the luxury of having a very stylish best friend growing up, I know first hand the benefits of borrowing and trading clothes.  I’ve talked about Goodwill on this blog before so I don’t want to harp too much on it, but I am proud to wear at least 75% Goodwill clothing everyday.  It feels great to shop more often and get more selection than I would if I limited myself to regular stores.  Not to mention that reusing is recycling and boy we could use more of that than ever before!  Shop in your friends closets!  You won’t regret it!

How do you ball on a budget? 
I was raised with the understanding that “new” does not mean “good.” From a young age, I was taught to excitedly accept hand-me-down clothes, a practice I keep up today. When you’re a girl like myself with plenty of stylish friends, it’s easy to get new stashes of clothes that they no longer want. There’s a cycle of clothes swapping that my friends and I all go through. One of us will decide it’s time to go through the closet and get rid of unworn clothes, but before dropping off the lot at Goodwill, it’s expected, at least in my circles, that you’ll give your friends first dibs. Over the years I have racked up quite the collection of second-hand digs, and it’s allowed me to keep my clothes budget down to insanely low amounts.
When I DO treat myself to new apparel, I will never pay full price for it. Websites like 6pm.com offer last season’s items at crazily discounted prices. I especially get big-ticket items like coats at this website, where I’ve scored down jackets for $70 that were previously priced at $240.

Question and Answer! Reward Programs, New Cars and Eating Out!

monkey_moneyHey Readers!
Question and Answer time!  This week’s answers are from the same contributor as last week.  One of the ways this individual saves money is by utilizing a points reward program, but as I learned with my credit card rewards program, reward program spending should be kept under serious watch-or it may not save you any money at all!  There’s another important reminder hidden in this weeks answers, and that’s being able to move on from mistakes.  Most of the regrets featured on this blog have been pretty substantial financial hiccups-but that’s all they are.  The sooner we can recognize our regrets, the sooner we can change them.
Keep on balling!

What financial decision do you most regret?

I’m pretty proud of the financial decisions that I have made throughout my life to get me where I am today, but I do have a few financial regrets.

  • RedCard Spending: You’d think that my love affair with the Target RedCard was a match made in heaven based on what I wrote last week, but I let my spending get out of control for a period of time.  I would record the purchases in my checking account register, but I didn’t realize how much I was spending in total at Target every month because I didn’t get a monthly bill like I do for my credit card.  When I noticed that I had saved $100 with my RedCard over the course of several months, I felt a little nauseous – I had to spend $2,000 at Target just to save $100.  Woah! I’ve become more intentional now about monitoring my Target spending.
  • Eating Out: After rent, my biggest expense is going out to eat. I never wanted to learn how to cook until I started looking at what percentage of my credit card expenses was consistently at restaurants every month.  Recently, I bulked up my pantry and started looking up recipes online.  Not only did I discover that I’m a good cook – okay, I’m good at following a recipe – but I am also noticing the money savings.
  • Buying A Brand New Car: I had been driving my previous car for twelve years, and nothing was really wrong with it.  Upon receiving a very generous financial gift due to a family member passing away, I came up with several reasons as to why the car I was driving was far inferior      to a brand new car.  After visiting a car dealership and selecting the car I wanted, the dealership offered me a loan with a 0.9% interest rate, which I considered but eventually turned down. Instead of continuing to build credit by making regular payments at a low interest rate and instead of saving any of the money I was gifted, I spent it all on a brand new car – oh, and I also tapped into my emergency fund to pay off the car in full.  I also came to realize that despite being fifteen years newer than my old car, my new car got worse gas mileage than my old one, which costs me more in fuel every month.  Overall, the new car is aesthetically beautiful and really fun to drive, but I did not go about researching or making this purchase in the most fiscally responsible way.

Balling on a Budget Update

Hey Readers!

Gonna try to make a living at this!

Gonna try to make a living at this!

Since beginning this blog early this past summer I’ve made a serious life decisions that will help me achieve my dream career: I’ve made the decision to go back to school to become a Certified Financial Planner.  The process of funding and enrolling in school is worthy of a blog post, but without writing a whole one right now, I will just assure you that I’ve been finding ways to save money at every stage of the process.  That being said, I am going to continue to post on Balling on a Budget but with less regularity.  As I continue to learn and develop new tricks of the trade, I will share them with you.  But don’t fret, I will continue to post the weekly Question and Answer column.

I am excited to begin my journey and I look forward to writing more *educated* posts.

-Madeline

Question and Answer Weekend: How do you Ball on a Budget?

Hey Readers!

This week we had a wonderful reader contribute some Balling on a Budget inspired tricks they use to Ball on a Budget in their lives! Below, you will see some themes that we’ve talked about before on Balling on a Budget, like emergency funds, living communally and dropping cable-but you will also read the thoughtful evaluation of our contributor’s diet, graduate school choice and favorite rewards program. 

Balling on a Budget is a personal adventure; we get to choose our own course for living within our means, but sharing our ways of doing it will help others strive for similar results.  Today’s answers got me thinking about changing our Question and Answer to “How do you Ball on a Budget?” I like this question a lot, so I might just continue asking it for a while!  But next week we will hear from the same contributor about what they regret about their financial choices.    Enjoy!


http://www.mrwallpaper.com/funny-chimpanzee-wallpaper/

Sundays are the best, aren’t they?

Someone recently told me, “You don’t get rich by giving it [money] away.”  I’ve always tried to live by this financial philosophy even though the phrase is new to me.  Below are some of my ballin’ financial wins and not so ballin’ financial regrets.

What financial decision are you most proud of? (OR, our new question:  “How do you Ball on a Budget in your daily life”?)

My parents had me sign up for a checking account when I was in eighth grade, so I would learn to be financially responsible from a young age.  I give credit to my parents for many of my financial wins because they instilled good financial habits in me from a young age.  I have quite a few tricks that I currently use to save money or have used in the past.

  • Savings Account/Emergency Fund: I have my paycheck deposited directly into my bank account every two weeks.  Since I don’t belong to a church, I decided that I would tithe to myself – I have 10% of my paycheck automatically deposited into savings every payday.  This tithing has been a great way to      build my emergency fund.
  • Discover Card Cashback Bonus: I have one credit card (a Discover Card) that I pay off in full every month.  My Discover Card gives me some pretty awesome rewards for no annual fee – 1% to 5% cash back on all of my purchases.  For the last three years, I have redeemed my Discover Card Cashback Bonus for Starbucks gift cards.  I redeem $45 worth of Cashback Bonus, and I get a free $50 Starbucks gift card in the mail!  Additionally, I register every Starbucks gift card I get sent, so now, I receive discounts and occasional free drinks through their loyalty program.       My occasional Starbucks splurge (maybe a latte a week) is great for the wallet, and I can indulge without feeling guilty.
  • Graduate School: I made the decision to attend graduate school immediately after undergrad since I was already used to living on a student budget, and I wasn’t ready to join the workforce full-time.  I applied to three different programs, and I was accepted into two of the three.  The first program (School A) did not offer me any scholarships, work awards, or financial aid but was my number one choice school.  The other program (School B) was my second choice school, but they offered me an incredible financial aid package. School B was going to pay for 3/5 of my tuition, a furnished  apartment on campus, a meal plan, and even give me a small stipend!  I knew that I would have to work for the university to get these great incentives, but I didn’t care because the offer they made me was very generous.  I decided to attend School B because of the long run financial pay off instead of attending School A because it was in a great city.  When I did the math, I saved over $100,000 in student loans by attending School B because of the financial support I was given.  I graduated with $17,000 in student loan debt that I was able to pay off pretty quickly.  (See next bullet point.)
  • Living with a Roommate/Paying Off Student Loans: Since I had never had debt in my life until graduate school, I was incredibly anxious about paying it off.  I decided that the quickest way for me to pay it off would be to minimize what would be my greatest monthly expense – rent – and use the savings to make larger student loan payments.  I found a great roommate, and the savings began.  I did not wait until the six-month grace period was over to start making payments; I wanted to reduce the balance as quickly as I could.  Any extra money that I had left over at the end of the month went toward making extra student loan payments. Because I lived minimally and very frugally during this period, I was able to pay off all $17,000 in student loans in a little over a year.
  • Shopping at Target: I have a little bit of a Target shopping habit/addiction.  I somehow find myself shopping at Target a few times per week and straying from my list consistently.  Target has some pretty great ways to save money if you know about the programs – RedCard and Cartwheel.  The Target RedCard is a debit or a credit card (avoid the credit card because it has around a 26% interest rate!!) that allows the shopper to save 5% on almost all purchases and get free shipping on target.com.  After  hearing the cashier give me the speech about the RedCard every time I went shopping and immediately saying no, I started to think about how much money I could save after researching more of the benefits.  After careful consideration, I decided to get the debit card because the money comes straight out of my checking account, and I don’t have to worry about paying another bill every month.  My favorite RedCard benefit?  I can save 5% on non-Target and non-Visa/American Express gift cards; for example, I was planning a vacation, and I needed to book an airplane ticket.  Target  sells Southwest Airlines gift cards. I purchased $300 worth of Southwest Airlines gift cards with my RedCard, but I only paid $285.  I also use my RedCard to buy restaurant gift cards.  If I need to buy a birthday present for a friend who lives across the country, I buy it on target.com with my RedCard.  I save my 5%, and I can  ship the gift directly to my friend for free!  Finally, Target has come out with this new smart phone app called Cartwheel.  Cartwheel has hundreds of digital coupons that I can select and then redeem at checkout.  The coupons are for things I already buy – granola bars, pasta, spices, fruits, vegetables, clothing, cleaning supplies, etc.  If I’m going to spend the money on these items anyway, I may as well save some extra money – and I can still use my RedCard for the extra savings! These little savings help me feel less guilty about the amount of money I spend at Target.
  • My Diet: I won’t go into my whole lecture about why I became a vegetarian, but in addition to      feeling much better than I did when I was eating meat, I’ve saved a ton of money!  Meat is expensive at the grocery store and at restaurants, so selecting the vegetarian option at a      restaurant is great for my wallet.
  • Cancelling Cable: I recently cancelled cable, and I’m saving an extra $60 per month!  I’m able to watch the same shows on Hulu for free, and I get out and explore the city more often instead of sitting in front of a television.
  • Retirement: I’ve had two full-time employers since leaving graduate school, and both have wonderful retirement programs.  With my first employer, I contributed 4% of my paycheck to a retirement fund, and they put in 8%!  Pretty amazing!  With my second employer, I contribute 5% of my paycheck to a retirement fund, and they match with an extra 5%.  Taking advantage of these retirement matching programs is a great way to spoil my future self!
  • Switching Jobs: After doing some research on comparable salaries while at my first job, I realized that I was pretty underpaid for similar jobs with similar levels of  experience.  I decided to switch  jobs and accept a position that paid significantly more (I admit searching for a job when I was already employed was much easier than when I was looking for my first job).  Believing in my skills, education, self worth, and work ethic helped me negotiate and persuade the recruiter that I was worth $20,000 a year more than what I was making in my first job.

 Want to share how you Ball on a Budget?  Send it my way!  mroche106@live.com.

Never pay full price, even for bills!

2 things happened to me recently:  I got sick and I got a driving ticket.  Both were unexpected reality checks, and both posed severe problems for my checkbook.   I hadn’t really budgeted for being sick, and I definitely hadn’t budgeted for blowing a red.  I am one to pay her bills, and to pay them on time, but I couldn’t help but think “if I don’t pay full price for much of anything I buy, why pay full price for my bills?”  Unlike many of my monthly bills, both of these bills gave me a unique opportunity to practice what I preach and follow up, be an active consumer and make some low cost high reward choices.  Here’s how I turned my unexpected big bills into manageable little bills.

The Doctors:

Since moving to Seattle I’ve been searching endlessly for a good general practitioner.  Unfortunately, I haven’t had much luck.  All the doctors seem to take the attitude of, “Oh, you’re fine.  But here’s a prescription just in case.”  Maybe that’s every doctor’s priority, but it’s not what I’ve been raised with or what I’m looking for.  Regardless, last month I came down with a pretty nasty cold that kept me out of work for a few days.  I decided to visit a doctor when someone planted the seed in my head that my cold could possibly be pneumonia.  AH!  I had pneumonia once in college and all I remember is taking a sip of cough medicine and sleeping for 17 hours.  Don’t get me wrong-that’s not a bad thing- I just didn’t have the time for pneumonia that month.

My cousin found this great little board with my motto on it.

My cousin found this great little board with my motto on it.

Upon entering the doctor’s office, I immediately got the impression that my cold was not a priority.  He heard me cough, looked in my ears and told me that “Oh, you’re fine,” but that I’ll absolutely have to have X-rays of my chest to determine if I have pneumonia or not.  I really, really didn’t want X-rays because I knew they were going to cost me money.  So I texted my mom with my financial worries, and sure enough I got the confirmation text that read “I say so.”  I couldn’t fight with that.  The doctor told me that he would call me that day with the results of the X-rays, so down I went into the dark and cold basement of the medical building.  I waited for 30 minutes to have 2 X-rays taken of my chest.  Then I waited and waited and waited to hear from the doctor.  I never heard from him, but I did receive a timely bill in my email box stating that I owed $160 for the X-rays, on top of my $20 copay.  I was pissed.

I spent about 20 min on the phone trying to figure out why I was charged for X-rays I didn’t want in the first place, and ones that the doctor promised me results from!  I explained to the billing specialists that I never received a follow up call from the doctor and because of that, I didn’t think I should have to pay for the X-rays.  He agreed and said he would look into it.  A few days after that, I received the “follow up” call I wanted-my doctor telling me that my lungs looked great.  A few days and a couple phone calls later, I left a message for my doctor explaining that I was overall very disappointed in her and her colleagues’ service (I didn’t see my primary care doctor initially), and that I had no other option but to look for a new doctor.  Sure enough, less than 24 hours later I received a message from the doctor’s office stating that my bills had been waived.  BOOM.  I happily paid my co-pay and closed that chapter in my book.

The Ticket:

Yesterday morning while driving to work I realized my headlight was out.  Being the concerned driver that I am, I drove my car to Jiffy Lube to have the headlight changed (I would have changed it myself, but I had to drive that night). The last thing I needed or wanted was a ticket for something that had an easy fix.  Sure enough, while I was driving home I caught myself driving through an intersection thinking “wow, that light doesn’t look very green.  In fact, it looks RED!”  AH!  I was shocked that I made it through and genuinely rattled and thankful that I hadn’t hit anyone.  As I peered through my rearview, I saw a little motorcycle weaving in and out of traffic zipping right up to me-red and blue’s flashing.  I pulled over and got a $124 ticket that I deserved.  Although I “made the cop’s day,” it’s still a ticket and one that I can’t afford.  He talked me through the process of contesting it or mediating it-and I’m going to take him up on it.  I’m going to go to court and beg the judge to reduce the fine.  I’ll update ya’ll with the results.

Moral of the Story?

Follow up with bills that you receive for services that were subpar.  I’m not saying you should debate with your cable company (if you have cable) because you want to be charged less, but I am saying that if you go to the doctor, or receive a service of some sort, and aren’t happy with your experiences-let them know.  I wanted my doctor to know that I thought her service was subpar not just because I wanted my bill reduced, but because I genuinely want her to serve people better!  As for the ticket, if there’s a way to reduce it-why not?  It’s a low cost/high reward action I sure as heck am going to practice!

Question and Answer Weekend: Mutual Financial Decisions and The Freedom to Spend

Today’s contributor reminds us of the importance of setting up a consistent time to talk finances with your partner.  As today’s contributor calls it, a monthly “financial snapshot” will keep your finances and goals transparent and allow each member of the relationship to feel like they are equally contributing to their future, not to mention, doing so will allow you to reach your goals in the quickest amount of time.

Furthermore, today’s biggest regret reminds us all that at some point, we must let ourselves spend some money.  Saving is an important step to prepping for our future.  But there’s a whole “present” that we don’t want to miss in the process.  Experiences are incredible, and it would be a shame to let our lives go to waste worrying about how many quarters we have in our quarter jar.  Balling on a Budget is about being able to have experiences that are meaningful and not dictated by our budget.  Whether you’re saving up for a down payment on a house or for a vacation to Ethiopia or a dairy farm (yes, I’m going to a dairy farm this weekend), spending some of our money will allow us to do these things.  But first we have to allow ourselves to be OK parting with that money.

I hope you all have a fabulous and safe weekend.


chimps

Transparency with financial decisions are key to successful relationships.

What financial decision are you most proud of?

When I graduated from law school in 2012, my husband and I had no idea what our financial situation looked like.  We didn’t really know how much money I had borrowed or how much money we had.  I think fear of feeling overwhelmed by our financial picture kept us from actually crunching the numbers and we preferred to stay blissfully unaware.  Our only financial goal was to pay off all of our student loans in three years which was somewhat arbitrary.  When I began working, I put every other paycheck towards my loans because I assumed it would be better to pay off our loans quickly than have a large amount of savings.  We knew we wanted to buy a house sometime in the future, but I hadn’t considered that we would need a down payment.  Several months after I began working, we realized that we needed a plan.  We created a system which we refer to as our “financial snapshot.”  Every month or two, we sit down and document how much money we have, how much we owe, and we create a basic forecast into the future.  We also created a budget which allowed us to determine how much each of us could save each month towards our down payment and how much we could pay towards loans.  We realized that our down payment goal was more of a priority than paying off my student loans as aggressively as I had been doing.  At this rate, we should have a 20% down payment saved by next June and we should still be able to pay off our student loans within three years of my law school graduation.

I am proud that we decided to take charge of our finances and force ourselves to make a documented financial plan.  If we would have waited any longer, I would have continued to pay off my loans too aggressively and we wouldn’t have been able to put 20% down on our house.  Although this wouldn’t be the end of the world given that it is possible to put down less than 20%, we made that goal to avoid paying private mortgage insurance once we do buy the house.  The savings this will bring us will far outweigh the interest we are paying on my loans in the meantime.  If we hadn’t taken charge of our finances, we would have continued making arbitrary financial decisions rather than educated ones.

What financial decision do you most regret?

My biggest financial regrets involve being too conservative with money.  As mentioned, I sometimes have financial fears which lead me to make irrational decisions.  This fear led me to pay my student loans too aggressively, depleting necessary savings.  My biggest example of being too financially conservative was in college.  I was studying abroad and my husband (who was my boyfriend at the time) wanted to come visit me.  Although we had completely separate finances at the time, I was basically aware of his finances and we were fairly certain we would get engaged in the next year or two.  I convinced him not to come visit me abroad because I thought it would be dangerous to spend so much of his savings on travel.  I now realize that was a mistake and feel very guilty about letting my financial fears deprive him of what would have been an incredible experience.  I have definitely worked on this and changed my perspective.  When we unexpectedly received $10,000 last year, we chose to put $4,000 towards loans and $6,000 towards travel.  I know this was the right decision and I have worked at keeping my fear of spending money from depriving my husband and me of valuable life experiences.


 Want to share your answers?  Email me at mroche106@live.com.

Can You Live With a Cable Alternative?

I’m not in the business of telling people what they should and shouldn’t spend their money on, but I am in the business of providing alternatives to life’s more expensive luxuries.   So, this week we are going to talk about cable – the luxury near and dear to many of our hearts.

Is cable costing you more than it should?

Is cable costing you more than it should?

Cable:  The Bad and The Ugly:

I’ve been known to kick back a few dozen episodes of Friday Night Lights and vege out to old classics like Water World, but I do so without paying for cable.  We must get real, friends.  Cable is EXPENSIVE.  The price of cable tripled between 2001 and 2011, rising from $48 to $128 a month.  If you’re spending $100 on a cable a month, that’s $1,200 over the course of the year.   And guess what?  Cable is only going to get more expensive.  Take for example what’s going on in my hometown of Chicago.  Mayor Rahm Emanuel wants his Chicago peeps to help their city offset its financial deficit by raising the “amusement” tax on cable to 6%.  Internet cable and satellite TV are exempt from the amusement tax under federal law, but those alternatives are even more expensive than cable.  Whatever your opinion is about taxes doesn’t change the fact that it will be an additional cost that you as the consumer will bear.  Not to mention cable companies have notoriously bad customer service.   The most likely reason you have to call them is because they over charged you, which is a good reason in and of itself to cut ties.  Support companies that treat you well, fix their mistakes and don’t waste your time by making you sit on the phone listening to mind numbing music. Market Participation?

How To Live Without Cable: 

First, do some thinking about what you watch. I always found “flipping through the channels” to be difficult when I have 1000 to choose from, most of which are sports or in another language.  Do you only watch specific series?  Do you like a variety of movies? Political thrillers with strong male lead characters?  Whatever you like, you can figure out how to get your fix without paying a massive amount for Dish Network or cable.  Purchasing a Wii for $60, or a Roku for slightly more, will allow you to have all the access to internet cable you’d like-for a much cheaper price.  Netflix, whether you stream or hand pick your movies for delivery, has an incredible selection of all your favorites for $7.99 a month for each service.  If you’re an avid watcher of Mountain Men or Restaurant Impossible, get Hulu for $8.99 a month and watch it all day long.  But if you like movies and practicing your patience, get a library card and start requesting whatever Kevin Bacon movie you’re craving to be sent to your local library.   Yes, some of these options require money and a few irritating advertisements, but they all cost substantially less than paying for hundreds of channels you never watch.

Moral of the Story?

If one of your luxuries is sitting down in front of your TV with a bowl of macaroni and cheese, then all it takes to Ball on a Budget is to consider your options.  Whether your motivation to cut ties with your cable company stems from their bad customer service, or your city’s taxes, or from your desire to save money, doing so can free up money for you to use on other things.  Why spend more when you can get what you need for cheaper? Low cost high reward?  

Question and Answer Weekend: Student Loans and Bankruptcy

Today’s Question and Answers contributor brings up a topic that is important to many Balling on a Budget readers: the inability to discharge student loan debt through bankruptcy. Our contributor questions why the choice to go to law school is more reckless than spending hundreds of thousands of dollar outside one’s limits, and ponders why can one spender can relinquish their credit, while another cannot.  These are great questions, and they explore areas that a lot of borrowers don’t think about until too late.  Student loan debt is treated differently in the eyes of the courts and the debt cannot be discharged, meaning even if you declare bankruptcy for hundreds of dollars of credit debt, your hefty federal loan isn’t going anywhere.

Today’s contributor also reminds us of the logicalness of maintaining a budget conscious attitude towards life.  Even if you can’t relinquish your student loan debt, you can change your view of money, whether that is how much you need, or even want to have.

 Some interesting things to ponder as we close out our week. Hope you all have a great Sunday.


What financial decision do you most regret? Obviously, law school. Worst decision ever. Massive debt and no decent paying job to pay it off. Unlike every other type of debt, student loans cannot be discharged in bankruptcy. So if you make a mistake when you’re young and take out debt for school (still very expensive even if you have a scholarship, which I did), you can’t ever “undo” that mistake like you can if you buy more house than you can afford or go on a million dollar shopping spree. If you engage in those reckless activities, you can declare bankruptcy and start over from scratch. And hopefully learn from your mistake and not do it again. Sure, your credit will be in the toilet for around seven years and it will be hard to get a loan during that time, but that’s a small inconvenience to pay for your financial sins in my opinion. Graduating post 2008 with school debt, however, I am afforded no such protections for changing market conditions and youthful mistakes

What financial decision are you most proud of?

My decision to lead a frugal and minimalist lifestyle. I just don’t need even a fraction of all the stuff society tells me I need. It simplifies my life, reduces stress and saves cash! It’s liberating to disagree with mainstream society and make consumer decisions based on my values, not someone else’s. Instead of accumulating possessions, I accumulate experiences and consumable necessities like food and toothpaste. I don’t need a new laptop every two years… I can make mine last for seven. No need to upgrade my perfectly fine six-year-old iPod, either. I don’t need a fancy car… or any car at all (for now). I don’t need more trinkets, doo dads and knickknacks… and if for some reason I did, I wouldn’t be paying retail prices. Before I buy something, I ask myself: do I REALLY need this? Because stuff is a burden. It has to be cleaned, maintained, stored and packed up when you move. When I consider this before I buy something, I find these burdens, plus the cash, often mean I don’t need it. Society tells me I need a super fancy, pricey wedding. Well, I don’t need seven bridesmaids… one is fine with me. I don’t need a limo at my wedding or a photobooth. I don’t need a $2,000 dress from a fancy designer… or a dress at any price near that. Not that these aren’t cool things, but they aren’t things I NEED, they don’t bring me enough joy to justify the price and they don’t mesh with my goal of simple beauty. When you focus on things you really do need, as opposed to what society is saying you MUST have, you encounter the joy of taking control over your own decisions and not simply following the pack. And you save a ton of cash for whatever you have decided is important to YOU. I am proud I have found this evasive form of joy in our society.


What are your biggest financial regret and achievement?  Let me know!  mroche106@live.com

Daily Cost of Living: Small Purchases, Utility and Worth-Part 2

Last week we talked about how much we were spending on our daily outs.  Today, we are going to explore the purpose of those outs-or better yet, their utility.


A few months back I read The Happiness Project by Gretchen Rubin.  Well, I actually only read the first few chapters because I found it a bit mundane (and putting down a book midway is a privilege I feel like I’ve earned).  But that’s not to say Gretchen’s ideas didn’t get me thinking.  In fact, her idea of prolonged happiness really stood out to me.

For instance, vacations are fun and exciting, right? Did you know that you’re actually happier the week leading up to your vacation than the week you are on vacation? The buildup is what gets our happiness hormones moving.  Similarly, smaller gifts, like a flower here and there, make us happier than if we received one annual bouquet of flowers.  Which brings us to the Latte-a-Day conundrum:  Gretchen proposes that if a latte a day is what gets us up for work and keeps us there, as well as increases our happiness, then maybe we shouldn’t cut that out. Her theory got me thinking about the utility of our financial choices.

Utility is defined as being useful, profitable and beneficial.  If something brings you happiness, increases productivity, maintains your sanity, then by golly don’t stop!  Those items have utility!  But we can use that excuse for all of our choices, can’t we?  If we want to Ball on a Budget, we must think realistically about the utility of the choices.  Take for example my little snack problem.  I spend about $10 a week on snacks from the snack shop in my building.  This wouldn’t be a problem except that this $10 is on top of all the dollars worth of snacks I buy at the store every week.

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Snacks are good for you, but not when you buy them out of laziness!

Why do I buy snacks?

  1. I forget to pack snacks, and/or
  2. The snacks I have are far inferior to the snacks downstairs, and/or
  3. I’m bored/tired/hungry.

Are these snacks useful to me?  No.  They are crap in aluminum wrappers and often are so processed that their colors aren’t even on the color wheel.  Are they profitable?  No, buying 5 packs of CheezIts throughout the week is substantially more money than buying one box at the beginning of the week.  Are they beneficial?  No.  I don’t feel very good after I eat them, my market participation is embarrassing and I waste my time getting them.  Final score?  Snacks don’t have the utility I need to justify them as a daily out.

Now that I’ve evaluated my most common daily out, I am going to try to eliminate it.  Here is how I will combat my reasons for buying the snack in the first place:

  1. Pack my lunch before I go to bed, and/or
  2. Buy snacks that I will want to eat, and/or
  3. Take a walk/drink a tea/eat my snacks and get the hell over it

When I hit a point in my workday when my stomach says it doesn’t want what I’ve planned for lunch, and immediately reminds me of the snack shop, I will immediately remind my brain of their lack of utility.

I’ll admit, $10 a week on snacks isn’t a lot, but when you combine that with all of your other daily outs, you might be looking at a hefty daily price.  As we learned, outs add up, and evaluating each out’s individual utility might help you decrease them.   Of course, this requires us to be honest with ourselves and not default to Gretchen Rubin’s defense that it brings us happiness.


What is your latte-a-day?  Does it have utility?