April's Unusual Spending

In an effort to curb out of control spending and to continue decreasing our total debt, I try to plan ahead each month and set aside funds for our unusual spending. Obviously, we are more successful some months than we are others.

Things we have to pay for in April are spring break, our last car registration of the year, our supplemental property taxes, and tea with friends. Overall, it doesn’t look too bad.

I am expecting some small extra monies this month to help cover some of the costs.  I worked a few extra hours in March that I will be paid out for in April. I’m using that to pay for our final car registration of the year. Paying 4 car registrations, one a month, boom, boom, boom, boom, at the beginning of the year is really a pain, but on the flip side, it’s nice to have it done and over with. The extra hours I worked should actually just cover what we need to pay! As much as I wish this money could go towards debt, I’m glad I don’t have to go further into debt in order to pay it. In the event that it’s not enough, The Husband received a raise that will go into effect with his first April paycheck. I’m sure that increase will be enough to cover the rest. Anything else left over from his raise will start to go towards debt. We are hoping for an after tax increase of about $90, which doesn’t sound like much, but over the course of the year, that’s more than $1000.

When we bought our new house 10 months ago, our property was reassessed at the new value. We received a supplemental tax bill for about $630. This was split into two payments by our county tax assessor with the final payment due on 4/30. (This was much smaller than the assessment we received on our first house, which was $1800; and a much smaller house and purchase price. Go figure.) I don’t have an actual plan to pay this yet. I’m hoping that there will be enough of a buffer in my checking account to pay for it that way. If, by its due date, there isn’t, this will be paid out of our yearly expenses account or taken from our savings.

Spring break… we are not traveling anywhere for spring break this year, but I would like to do some “stuff” with the kids on our time off. We have plans to paint The Boys bedroom which will incur some costs. We’ve already bought the paint but we need some of the stuff associated with prepping to paint: disposable paint trays, tape, paper, paint brushes, etc. Those are the only hard and fast plans we have for break. Other than that, we will just need to pay for “fun” stuff. I would like to take the kids to the movies and shopping for some spring clothes. We will probably hit up a bookstore at some pint too. Nothing too extravagant, but I want to do some fun things with them. Now to figure out where the money for this is going to come from…

Each year, I host a birthday tea with a group of friends. It increases my food budget. In order to make up for it, this year I plan to pad my food budget by about $15 each paycheck. That should be enough to keep me on budget for our groceries for the month, but we will have to wait and see. We have sandwiches, savories, scones, and sweets, but often we have a lot of the ingredients on hand and only to purchase a few. Hopefully that is the case this year too!

Overall, unusual spending for the month doesn’t look too bad so I hope we can keep it in check!

Debt Update

February was a busy month and somehow I completely missed doing a debt update. (*It’s probably for the best, as our debt increased.)

The debt we owe our children has continued to (ever so slowly) decrease. We borrowed $1500 from each child and have paid back $750 to each of them, which means we are half way through paying them back! Our car loan has continued to decrease as well. We have a 0% loan so it’s nice to see the payment actually affect the bottom line.

For 2018, my only resolution, or goal, is to have our credit card balance below $10000 by the end of the year. I obviously started with 12 months, now I’m down to 9 months to go.

Here are our current debt totals:

    $16,379.55            Credit Card at 15.74% interest

                $750                      The Girl

                $750                      The Boy

                $8235                    Car Loan at 0% interest

Our total debt stands at: $26,114.55. YIKES! That is still a huge number! The only thing that makes me happy about that number is that it is smaller than the last time I did a debt update! I hope it keeps going down! We managed to decrease out total debt by about 6%. We did take a lot of money out of savings to send towards debt this month. It was nice to get some traction.

In order to meet my goal of under $10000 for the year, we need to pay back a minimum of $604.03 per month, not including interest. It is a doable amount if we are diligent with our money. And in all honesty, we usually aren’t. Including interest, we need to pay back closer to $800 per month and I am a little nervous about reaching that amount. I will shoot for $604 per month first, and then go from there.

Again, we are going to get a little boost here as we got a larger-than-ever-before tax refund and so are planning to use at least some of that towards our credit card debt. Originally, my plan was to send half of our refund to debt, but further thinking has reminded me of some upcoming expenses we have on the horizon: Japanese foreign exchange student, season tickets to the theater in SF, and The Husband’s 40^th birthday. We will, however, still send some of our refund towards debt.

I’m also waiting on about $250 that a friend owes me. When she pays me back, I will take that entire check and send it towards debt. It’s not much, but every little bit helps. I just want to continue making progress and decreasing our debt load.

I will try to keep track of my progress each month and find out if I am meeting my goal of paying off over $600 of debt per month and therefore on track to meet my goal of credit card debt below $10000.

Changing Retirement Contributions

As a public school teacher, my raises are prescribed by a pay scale that is based on years of service. I never get merit raises or bonuses. The Husband on the other hand, gets yearly raises based upon merit and effort. In the coming weeks, we will find out how much of a raise he will get.

Currently, The Husband contributes 17% (plus a 3% match) towards his retirement. As we were late to the game, we are playing catch up with our retirement so we are working to max out our 401ks (or in my case, 403b). The first one percent of any raise he gets will go towards his 401k in order to max out his contributions. Originally, we had planned to then adjust my contributions so that his entire raise was going towards our retirement, but between debt and our new normal, we need a little more cushion in our monthly budget.

I’m also so tempted to change my current contributions. As a teacher, my district automatically takes out 10% of my check for my pension. Currently that works out to about $750 a month. In addition, I contribute another $1000 per month, pre-tax to my retirement. If I stopped my additional retirement contributions, I could take home an extra $750. That would actually cover our entire credit card payment, and then some, that is required to get below $10000 by the end of the year.

Knowing myself, though, I’m so afraid I would spend that money and have nothing to show for it. In other words, I’m afraid I wouldn’t use it for its intended target. At least keeping it going towards retirement, it’s money that will benefit me someday.

So far I have resisted the temptation to change my contributions, but the “bonus” of our tax refund makes me rethink my plan. I need to try to remember that we will get out of debt, but this is long term planning! We dug ourselves a hole with our debt and now we need to fill it back in one shovel full at a time, however, we can’t sacrifice our future security for our past debts.

Taxes are Done

…and the refund should be hitting our checking account sometime in the next two weeks or so.

You read that right, the refund! We are getting back just over $4000 between our state and federal refunds.

This is the biggest refund I think we’ve ever gotten, ever.

Generally, we end up with a small refund overall. We usually get a refund from the state but end up having to pay federal taxes. Our net outcome is usually in the few hundred dollars in our favor.

Due to buying and selling a house this year our refund was much larger than normal. We actually got a refund from the federal government, albeit a small one, and one from the state.

I’m so excited! $4000 was far beyond my wildest dreams!

In my day dreams the other day, where I wrote about taxes, I said half on any refund would go towards debt and the other half would go towards savings. I was dreaming about $2000… total; this was really dreaming as usually we only get a $700 refund. I was hoping we would get enough to send $1000 to debt and $1000 to savings. I can’t believe we actually got twice that!

I can’t wait to get that money in my bank account so I can send it to work for me!

We tend to fall into the “don’t give the government an interest free loan” category, however, buying and selling houses this past year made for crazy taxes for us this year! In one sense, I’m annoyed by how big our refund is because that is money we could have used throughout the year. In another sense, I appreciate the “windfall” I am now getting that I can put to work. Had I received that money monthly, in the forms of nickel and dimes, I surely would have found a way to waste it.

If, as I plan, I send $2000 to our credit card debt, that will go a long way towards my needed $750 a month in payments. In fact, it will bring what I need to pay monthly, for the next 8 months, down to $563 per month. Paying $563 per month, before interest, will bring our credit card balance down below $10000 by the end of the year.

This refund is a gift and I hope to get several more “gifts” over the course of the year: overtime, raises, extra pay/hours, unexpected monies, etc. I’m hoping that any of these will be able to go straight towards killing our debt once and for all.

Taxes

We (and by we, I mean The Husband) is in the beginning stages of filing our taxes. We have received, or tracked down, all of the documents we need. Because we sold and bought a house this year, the number of documents we need were increased several-fold!

I’m hoping we get a decent refund.

The good news so far, is that we don’t have to pay taxes on any of the proceeds from the sale of our old house. (I didn’t think we would, especially because we rolled it right back into the purchase of another house, but with the US government you never know!)

But we still have a long way to go.

Depending on the size of any refund we get I want to drop half into savings and the other half straight towards our debt. We don’t have any family vacations planned for this year which is usually what we put our tax returns towards, so I’m hoping it will be one month where we can put money into savings instead of taking it out.

I’m also hoping we can use a small chunk to wipe out another chunk of our credit card debt. With a balance of about $16000 to go, and only 8.5 months left to do it in, we need to pay off about $705 per month (not including interest) to meet our goal of being under $10000 of credit card debt by the end of the year. Any amount of tax refund would benefit our goals.

Apparently, I’m still shooting for the ever elusive <$20000. It has been well over a year since I have had less than $20000 of debt. By virtue of reaching less than $10000 of credit card debt, we will fall under $20000 of total debt. I can’t wait to see that first number of our debt roll back.

My husband always does the taxes so in this instance, I am at his mercy until he wants to finish preparing them. Until then, we don’t know exactly how much of a refund we will get (if any).

The Japan Secret

The Boy and I are going to Japan. Financially it’s not the wisest decision, however, I do think it will be the trip of a lifetime, especially for The Boy.

Where we live, students in the 8^th grade have an opportunity to apply to travel to Japan as ambassadors for our Sister City Association. The Boy was chosen. And then they needed chaperones and I was chosen. As it is an educational trip, they like sending teachers as chaperones.

The down side of this trip is that we need to pay for it. The association estimated $2500 per person. This fee includes: airfare, host gifts, special shoes, the price of passports, and association dues and fees. We have already paid for our passports, and all the association fees. And on the plus side, we were able to purchase our airfare for $500 less than the price they quoted us. That brings our total cost down to $4000 (for both of us) or less. And, as I said, we’ve already paid for many of the expenditures we are expected to pay for.

Our cost does not include ground fees. These are estimated at $4800. These fees pay for hotels on both the frontend and backend of our trip, traveling fees such as trains and buses, and food costs. As a group, we are expected to fundraise at least this much. Anything above and beyond this will be refunded to us in equal parts after our trip.

Although fundraising is not my favorite thing, I like the idea of getting to lower my cost by doing so. Our group has come up with some really good ideas. We have already done a Krispy Kreme fundraiser which raised $1200 for us. We plan to hold a dinner at our local Elks Lodge. We will sell tickets to the dinner and hold a bake sale there. We have a wine and paint night planned. Our last big fundraise is a community rummage sale.

In addition to all the “big” events, we have plans for dinner nights out where part of the proceeds benefit our organization. We are having small raffles, both at some of the events and as a stand alone fundraiser. The last major fundraiser we are doing is a letter drive. We plan to send out letters to friends, family, and local businesses we have an association with asking them to sponsor our trip. Through all these things we are hoping to raise enough money to cover all our ground fees and then some.

In years past, participants have gotten as little as $0 back and as much as $1400. To defray our costs out of pocket, I’m hoping we fall somewhere in the middle.  I would be happy if we got about $700 back. Because both my son and I are going, we would get $700 each, or $1400.

Financially, Japan is not the wisest decision, however I do believe it is a once in a lifetime trip. We will not be charging any of the trip. All of our expenses will come out of our savings account, which is both wonderful and scary. I’m pleased we have the money in savings to cover the trip, but a little nervous about how much it will be depleting our savings. Going forward, we will have to work on being more diligent with our spending so we won’t need to dip into our savings.

Honestly, I debated whether or not to share about the trip on my blog. I know it’s not a good financial choice, but I also believe in being honest about where we are and where we are going. So, Japan. Don’t judge.

We Passed!

Several weeks ago I wrote about our car troubles and how much they were costing us. This past week, The Husband took my car to get smogged and I held my breath until he got home.

I’m so happy to say that my car passed smog!

Weeks ago, when my check engine light came on, The Husband worked with a very good mechanic friend of ours to try to diagnose the problem. The “little code machine” came back with a code indicating it was an emissions issue. Our mechanic friend worried we might need a new catalytic converter. The price of replacing that ran anywhere from $800 - $1500. After everything we have dropped on vehicles in the last 2 months, we weren’t looking forward to having to do that too.

The Husband worked some magic and did a few things and then reset the check engine light. Happily, it hasn’t come back on since then, and now even more happily, our car passed smog.

Our luck with cars hasn’t been stellar lately. Our once healthy car repair envelope quickly dwindled to zero and then negatives. It currently sits at about $50. (Bonus, that is after paying for smog!) Each month we add $100 to our car envelope and any leftover money from our gas envelope. It, of course, is not growing as quickly as I would like it to.

I’m just so happy my car passed smog. Once The Husband got home, I was able to breathe a big sigh of relief and praise God for the simple blessing!

Two days later and I’m still on a high over this one!!!

Unusual Spending for March

I know this post is a little late, but better late than never.  I still like to see our unusual spending in black and white, it makes it much easier to plan for.

March is always an interesting month for us. Most of our dance payments for The Girl are taken care of, we’ve already paid for The Boy’s baseball, but it’s also The Husband’s birthday month, and this year he turns 40! In addition, we have a foreign exchange student coming to live with us for a week and with that we are hosting a potluck at our house welcoming all the kids from Japan. We will be holding family birthday parties at our house this month. Lastly we have two car registrations due for the month of March.

We have a lot going on this month!

The Husband turns 40 this month! I can’t believe it! I want to get him a nice gift, actually two nice gifts. One that he asked for and one that I picked out that I know he will love! I had my brother-in-law help with the gift my husband requested as it is a woodworking tool and I know absolutely nothing about those! The other one is a total secret (and probably won’t be able to get gotten until the summer time… did you follow that?).

Along with his actual birthday, we are hosting family birthday parties at my house. I’m going to go easy for food and get lasagna, salad, and French bread… all pre-made and from Costco. It’s more expensive to buy pre-made, but the convenience is worth it. I’m hoping to pay for most of this out of my grocery budget for March. I planned most of my March meals using food we already had so I don’t need to buy too much this month so I’m hoping to skate by on the budget side of things here.

At the end of this month, we are hosting a foreign exchange student from Japan for just under a week. She has already said she’s excited to try lobster and beef…eek! Holy expensive tastes Batman! We also plan to take her to Simply Fondue for dinner one night and would like to take her to Mexican food as that isn’t really a “thing” in Japan. We also want to take her to a zoo or aquarium while she is here. As part of having a foreign exchange student, we are hosting a potluck for everyone involved at our house. We of course only need to supply one dish, but we will also need plates, cups, napkins, serving utensils, etc. (And our house needs to be super cleaned… but I guess that’s another story for another day.)

We actually have two car registrations due in the month of March. The Husband’s daily driver and mine. We paid The Husband’s out of our annual expenses budget and will be covering mine using the cushion in our checking account. Somehow over the last few months, we have gained a $300+ cushion in our checking account. In one sense, I think that’s awesome, but in another, that money is not working for us; and as we are in debt, we need our money to be working for us. I only discovered the extent of the cushion recently when I was reconciling my bank balance.

March definitely has some expensive things going on, and we haven’t really planned out how to budget for them. But being aware of them is half the battle.

Going forward, I hope to write my unusual spending posts and then create the budget to match; in that way, we will account for all unexpected/unusual spending in our budget.

February Unusual Spending Recap

Overall, I feel like we did pretty well in February. Whether or not that’s really the case will be determined by how we did on estimating and covering our unusual spending for February.

Here is what I wrote about our expected unusual spending for the month of February.   In February, The Girl has a dance dress rehearsal and a competition in Las Vegas. The Boy will be starting baseball. We bought The Kids tickets to a Warriors game for Christmas and so that happens in February too. Other than that, our month will be pretty normal: haircuts, family birthdays, and life.

And here’s how we did…

We did plan dinner for the night of her dress rehearsal which kept us from going out to eat. It was a small savings, but a savings nonetheless. It took planning and a little help from The Husband to make it happen, but we did it.

Our trip to Las Vegas for The Girl’s dance competition went pretty well. In fact, I was so pleased with how well we did that I wrote a whole post about doing Las Vegas on the Cheap. Obviously, we spent money, but overall we kept our spending to a minimum.

Baseball was a little pricier than I anticipated. However, even with that, we have been able to cash flow a lot of The Boy’s baseball needs. This year, The Boy needed: a new bat, cleats, pants, batting gloves, and a helmet. We did have some money in our kids’ activities envelope that paid for his cleats and batting gloves. Also, The Husband had some overtime on his last pay period which netted us about $100. This paid for The Boy’s bat and a little towards his helmet. We ended up being about $50 short for everything we needed, but that was actually better than I expected. Now that our kids’ activities envelope is down to $0, we will have to start building it up again. We shouldn’t need too much in that category for a few months. Hopefully it will give us time to get a little cushion in there.

We did attend a Warrior’s game in February and it was fantastic! The Kids had a blast and we were able to keep spending to a minimum! With the tickets The Kids got for Christmas, they each got something to wear to the game. We ate dinner at home before we left for the game and then treated them each to a cotton candy while we were there. The most expensive part of the night was paying for parking: $40!!! The Husband used his gas money to pay for that so we didn’t have anything extra “out of pocket”.

Each of The Kids did get a haircut in February and those were both covered by money in our “hair” envelope. Going forward, we will continue to fund this at $50 per month. That should be enough to keep up on paying for The Kids.

Overall, spending for February was held in check. I’m definitely counting this month as a win! Here’s to hoping for more months like this!

Drastic Times Call for Drastic Measures

Due to unforeseen circumstances, our credit card bill did not, in fact, go down, but it actually went up. You’ve already read about my car saga, and if you haven’t, you can do so here.

That, coupled with some charges The Husband made, that I was unaware of, caused our bill to sky rocket to just over $18000 by the last closing date.

I am done not being able to make any headway on our credit card bill. I am done with the balance increasing every month. I am just done!

So, my solution is to take $3000 out of savings and plunk it straight on the balance on our credit card; sort of as a way to kickstart our debt repayment.

It's not ideal, but I need to seem some progress. I have got to see a decreased balance on my credit card and I'm hopint this will be the beginning of a downward trend!

I don’t know if it’s the best solution, but right now, it’s the only solution I’ve got.

I am so sick of increased balances on our credit card!