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 Post subject: Judge my Budget! And don't laugh at my little numbers!
PostPosted: Fri Aug 22, 2008 3:04 pm 

Joined: Thu Mar 20, 2008 3:22 pm
Posts: 52
Location: Florida
Hi!
This seems like a great place (and time, I'm trapped inside all day while this hurricane/tropical storm tears through my town) to have my budget and fiscal lifestyle critiqued. My husband and I have already trimmed as much as we feel like we can, BUT BUT BUT there is always room for improvement and the chance that some of you might see something we can trim or have other influential ideas about our budget.

okay, Judge away.


My take home income after taxes: $240.00/week (full-time-Salary)

Husband's take home income after taxes: $230.00/week (he was dropped to part-time last year, so this number varies depending on the hours he can get)

Total average monthly income: $1880.00

ING Savings Account @ 3%: $9,100.00

Bank of America Checking Account: $1,200.00 (generally steady, but drops right after rent is paid-we always try to have it at 1k or more just in case though)

________________________________________________________________________________________________________________________

Rent: $475/month

Utilities: $100.00/month (varies-if it's above 95 degrees inside we run one window air conditioner)

Car insurance: $60.00/month

My Student Loans: $115/month (realistically, I pay about $300 per month because I want this loan GONE and I like to suffer by a trimmed budget as much as possible... haha!). $11,000 total @ 2%

internet services: $40.00/month

Bank of America CC: 13% with $0.00 balance. I've only used it once for a vet bill emergency for my pet.

Spending money: $200/ month. This includes Gas for the car, groceries, pet food, and usually one public dining or recreational experience (a movie, a trip to the beach, etc. etc.)

**(anything extra always gets put into our ING savings account. We're looking to move to a new and more lucrative and cultural city in the next 2 years, and to buy a house at the 75-85k range in the next 10 years or so with 50k down.)**



Notes:


Neither of us are offered health insurance at our jobs. We are part of a county program called "choices," which allows us regular Dr. visits a few times a year and dental services 2x a year, but is not health insurance.. just a dr. visit program. We'd like to either buy a family policy, or find jobs that can supply insurance (VERY hard, we live in a college town and all the grads take all the jobs-I've been looking, and I mean aggressively looking [10 resumes out at a time, when one turns me down or I haven't heard from them in 3 weeks, another resume goes out], for 4 months, ugh.)

Although my job is low income and doesn't offer benefits, it IS steady and has taught me a lot about frugal living by placing me in a low income bracket. It's also one of those dreadfully wonderful jobs where by performing your duties, you're helping mankind... and those are hard to quit. I'm a personal assistant for a very young epileptic woman with a small child. By having me there, she is able to lead a normal life. I drive her, help her care for her child, and most recently, assisted her in starting up a small business of her own from her home. It's going to be hard to leave, but she and I both know it is time for me to move on.

We just moved from a $650/month apartment in a bad neighborhood to our current $475/month apartment in a quiet pretty neighborhood. YAY! We did have to spend about $75 to get the current apartment in live-able conditions. The last tenants let their cats urinate everywhere and bring fleas into the house along with the tenants NEVER having cleaned the bathroom or kitchen and the... well, I'll leave it at that. We HAD to buy cleaning supplies.

We share one vehicle, a 2000 Mitsubishi Mirage. I sold my vehicle a few months ago (to the dealership--if you have a Toyota truck, take it in to have the frame inspected), saved 8k of the profit and purchased a moped with $1,700 of the profit, which has not yet been delivered. I will carry no insurance on my moped and get 110mpg. The car gets about 35mpg and is driven about 40 miles a week which will be reduced once my moped arrives.

We hand wash and line dry all of our laundry, but I'd really like to have a small tumble electric dryer because in Florida's current rainy weather, line-drying means clothing hanging ALL over our 200 Sq Ft Apt. Does anyone have any advice or model recommendations?

We have a TV that was given to us and we use it for watching DVDs, but no cable. We pay for internet services and watch all of our TV and movies online for free. If we LOVE a movie or show, we buy it on DVD with our spending money if we have some left that month.

I do odd jobs for friends or acquaintances around town for household needs. I find that this makes it easier than receiving cash because I can restrict myself. I wash/walk dogs for toilet paper, paper towels, trash bags, etc. I cut hair for tips or household gifts. I got 1 year old ikea furniture for our entire new apartment in exchange for a haircut. I cleaned the gutters out of a house in exchange for work on my computer. This works out really well and I'm usually able to do enough labor to cover all of those types of needs. On occasion we'll end up having to buy a roll or two of paper towels or some trash bags, but not usually. My husband does barter work too, but usually not to support our needs. He'll do work for a video game or in exchange for electronics... I sometimes feel a bit irate about this, BUT I have to remember that he doesn't have the same connections and the people he knows may not HAVE a bulk supply of garbage bags for him... what they might have is a video game or hard drive. I'm coming to terms with this because he recently helped a friend out in exchange for really nice hair cutting scissors... which help me exercise my barter skills. But, I digress.

I work part-time 8 hours a week for a non-profit business in an effort to expand my business knowledge, build my resume, and stay in shape (it's a non-profit women's sports league).

I pay every student loan bill x3 meaning if it's $100.00, I pay $300.00. I've lowered it from about 15k to 11k in the last few months. I want it GONE.

I would REALLY like to go back to school at some point and move out of this area since their is an over flux of workers for the job market. I have an AA with honors and have MANY more credits (it'd take me ONE semester to have a BA if I transferred)... I had to take an AA because my 50% academic scholarship ran out and I started working a second job to pay for the difference. This left me little time to study and my grades were slipping steeply. I took the AA while I could still have an honorable GPA and not starve to death.

My husband just got his GED last year and would also like to go to college or tech school sometime soon. Since I've already had my chance, I'd like him to go first and for me to follow once he is done. We're both in our mid-to-late twenties and would like to be finished with our schooling and into our careers ASAP within reason.


I can't think of anything else pertinent to our budget or money... So does anyone have any suggestions? Any small job ideas for money making on the side? Any places you see that we could trim our spending? Any job markets you would recommend for my husband to go to school for? Any cities you recommend moving to when we're ready to move?

All comment welcome!

Thanks! :)


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PostPosted: Fri Aug 22, 2008 4:05 pm 

Joined: Sun Aug 03, 2008 7:24 pm
Posts: 104
Location: Texas
Well first, you are doing a wonderful job with a lower budget.

Not knowing what type of student loan I would ask if the extra money you pay goes to interest or priciple. Find out if you can have it go to priciple if it is not.

FINISH YOUR BA!!! If you are that close, bite the bullet and notch it out. It will improve your income potential especially if you are currently tyring to find better pay anyway. Once you finish and find something paying more, then I would suggest furthering his education if possible to allow him better potential as well. Check for grants for continuing education on low incomes.

Put all of your money for bills into your ING account until you need to pull it out to pay for it. No reason for rent money to just sit in a no interest checking account just waiting to be paid when it could be earning YOU more money even if just for a week or two.

Good luck and keep it up


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PostPosted: Fri Aug 22, 2008 6:25 pm 

Joined: Sat Dec 29, 2007 9:30 am
Posts: 579
hey, i'm not laughing at your numbers. i don't make much either and i'm interested in seeing how others work things.

do you really pay 60/mo for one car? i pay 80 for our 2 cars, one is a 1985 model and the other a 2005 model with full coverage. i know regional rates are different but you might want to shop around for rates, i did and i was glad.

same with utilities... i know some places are inherently more expensive, but my electric is 40/month on average for 700 sf. is there some big electric thing you're using but not thinking about? or is the apartment poorly insulated or something?

i'm not telling you anything new, but not having health insurance could be a disaster waiting to happen. it happened to us, and we even had insurance. knocked our finances out cold. after the past few years, i'm a big advocate of having insurance.

if the one semester of school for you would translate into significantly higher earning potential, take out the loans and do it. you're losing money every year that you wait. then you are better able to support your husband when he goes back- it works best for both sides. my husband is back in tech school at age 30 and i am proud as hell, and supporting him financially.

what about incidentals? tires for the car, annual vet bills, the vacuum cleaner kicks the bucket?

that said, your savings account is great and you guys are clearly doing what works for you. congratulations!


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PostPosted: Fri Aug 22, 2008 7:10 pm 

Joined: Fri Aug 31, 2007 7:48 am
Posts: 286
I'm sorry, but I'm going to laugh at one low number... your rent. $475 will get you a closet in this town, not a particularly nice closet either.

The only thing I can see to cut back on is the utilities. We are big energy users (I work from home, computers), but our utilities come out to $60 max even with air conditioning or fans going all night. I live in California, I think our energy rates are quite high compared to the rest of the country.


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PostPosted: Fri Aug 22, 2008 7:31 pm 
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Joined: Tue Aug 19, 2008 8:27 pm
Posts: 591
Location: NC
Laugh? It makes me want to cry. I make quite a bit more, but am in much worse shape. :)

By all means, take on debt to complete your BA. You will be much more employable with a Bachelors degree. If you've made it this far, you're cheating yourself by not finishing it up.

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PostPosted: Fri Aug 22, 2008 10:21 pm 
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Joined: Sun Aug 10, 2008 2:50 pm
Posts: 154
Location: South Florida
I understand the intense desire to get the student loan debt completely out of the picture as quickly as possible. If the interest rate for the student loan is VARIABLE and could change down the road at any point, then I would advocate continuing to pay it off steadily before it gets too high. If the 2% interest rate for the student loan is FIXED, then I would actually recommend making the minimum required payment every month because you are making more in interest from letting the money sit in ING (after taxes) than you are paying out in student loan interest. Interest rates will likely continue to rise... which only serves to reinforce the advice in the preceding sentence.


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PostPosted: Fri Aug 22, 2008 11:24 pm 

Joined: Thu Mar 20, 2008 3:22 pm
Posts: 52
Location: Florida
Quote:
do you really pay 60/mo for one car? i pay 80 for our 2 cars, one is a 1985 model and the other a 2005 model with full coverage. i know regional rates are different but you might want to shop around for rates, i did and i was glad.


Yes, and I've been considering changing this up. We pay high for this because the car is in my husbands name and he is a new driver with mediocre, if that, credit. I have been driving since I was 15 1/2 or whenever and have good credit. The car was his first car ever... so I think he's reluctant to transfer it into my name, but YES, I think he and I should seriously talk about it.

Quote:
same with utilities... i know some places are inherently more expensive, but my electric is 40/month on average for 700 sf. is there some big electric thing you're using but not thinking about? or is the apartment poorly insulated or something?


We have not yet paid the utility bill for the new place, but the number I named before was what our old place cost us (which was 2x as big). We will be paying Electric, Gas, trash pick up, and water run-off fee (a weird Florida thing, it's like $5 per month). Our old place was not at all insulated, but this new place is, so we hope the costs will go down. We don't run A/C unless it gets hot enough to ruin our TV (95+, BUT that tv has been dropped down a flight of stairs not once... but twice AND had to be left in the rain for an hour once too... it's frame is duct taped together and the damn thing just won't quit--if it melted from heat it'd probably become HD!!), and I have really annoying strict "lights out," rules in the house. Is it possible that two laptops plugged in, one light, and a window fan could cost as much as our old place did? I sure hope not. I guess we have a fridge too, but other than that-those are the only constants running. I'll update when we get our most current bill.

Quote:
i'm not telling you anything new, but not having health insurance could be a disaster waiting to happen. it happened to us, and we even had insurance. knocked our finances out cold. after the past few years, i'm a big advocate of having insurance.


Yes. Like I said, I'd REALLY like to find a job that offers health insurance OR find something we could afford to pay for on our own. I have sports insurance for my volunteer time with the women's league, but that's ONLY at practice and the deductible is laughable.

Quote:
if the one semester of school for you would translate into significantly higher earning potential, take out the loans and do it. you're losing money every year that you wait. then you are better able to support your husband when he goes back- it works best for both sides. my husband is back in tech school at age 30 and i am proud as hell, and supporting him financially.


I've been a little worried about it. It seems like, at least where we're living now there is such a mass of fresh graduates flooding the job market that almost any decent job requires a Doctorate or a Masters... I'm concerned that my BA, and all the debt that will come with it, may not change my hire-ability. Is this possible, or am I just being a pessimist? Good lord I don't think I could spend 10 years in school hunting a Doctorate.

Quote:
what about incidentals? tires for the car, annual vet bills, the vacuum cleaner kicks the bucket?


We've been using our savings account as our emergency fund. It started with 1k as an emergency fund, and when I sold my truck, I just dumped the rest into it. Should I open two accounts with ING and have one emergency and one savings account? Luckily for us, we're super duper minimalists, so we don't really have anything we couldn't live without (we have bikes if the car breaks down, we have feet if the bikes break down--we live downtown), BUT vet bills or medical bills I suppose would come out of savings. Should I set up another additional account to use for annual bills--maybe a separate checking account? Or can I just schedule these things into my budget and use the emergency fund or savings for a real emergency?


Quote:
I'm sorry, but I'm going to laugh at one low number... your rent. $475 will get you a closet in this town, not a particularly nice closet either.


Yeah, it pretty much IS a closet but we're making sacrifices to get to better places, ya know? Where do you live?


Quote:
I understand the intense desire to get the student loan debt completely out of the picture as quickly as possible. If the interest rate for the student loan is VARIABLE and could change down the road at any point, then I would advocate continuing to pay it off steadily before it gets too high. If the 2% interest rate for the student loan is FIXED, then I would actually recommend making the minimum required payment every month because you are making more in interest from letting the money sit in ING (after taxes) than you are paying out in student loan interest. Interest rates will likely continue to rise... which only serves to reinforce the advice in the preceding sentence.


The 2% is a fixed rate. I locked it in as a freshman in college at age 16 when I had no idea what they were even saying to me... haha, that was a lucky move. That's an interesting idea, to let it sit in my ING account until it's time for the Min. payment. I think I may follow that advice, although if I get significantly more than I owe in savings, I'm gonna pay it all off in one huge chunk. Your advice makes a lot of sense... I never would have thought about it that way, I've just been ravenously paying it three, four, or five times what was owed and often times having to make HUGE sacrifices to do so (skipping grocery shopping, etc.) but since my sitting money is growing, I'll keep my payments steady and my cupboards full enough. Thanks!


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PostPosted: Sat Aug 23, 2008 2:21 pm 

Joined: Fri Aug 22, 2008 7:50 pm
Posts: 107
Sounds like you're doing a great job of handling finances with your limited budget!

I agree that at 2% interest you don't need be making double/triple payments. Psychologically it does feel good to pay off debt, but that is such low interest that your money is better of in savings where it can grow. Sounds like you are cutting back on things in order to make those extra loan payments, and it's really not necessary! I would just pay the minimums for now, and when you're bringing in more money or have your savings bulked up, then you can go back to making extra loan payments.

I'm in a similar situation with students loans at fixed interest rates of 2.5%-3.5% (consolidated at the lower rates during my grace period after graduation). Because I still need to build up my emergency fund and also want to max out my Roth IRA, I am only paying minimums on my student loans for as long as it takes me to meet these other financial goals.

You probably don't need to keep so much money in your checking account. I would only keep as much as you need for bills and everyday needs, plus a little buffer (maybe $100 extra, but depends on your comfort zone). Checking accounts have very low or no interest, so you should keep as little in them as needed. Keep the bulk of your money somewhere else so it can grow. My checking account gets down to less than $100 by end of the month, but then gets replenished when my paycheck comes in, and then the cycle of bills and debit transactions starts all over again for the next month. Emergencies can go on a credit card, and then there's time to transfer money from ING saving to your checking account in time to pay off the bill when it arrives.


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PostPosted: Tue Aug 26, 2008 9:52 am 

Joined: Thu Mar 20, 2008 3:22 pm
Posts: 52
Location: Florida
Thanks so much for all of the advice!! Actually it turned out lucky that we have so much in checking currently. It takes several days to transfer from our ING savings into checking and our car broke down last night. We share it and need it fixed NOW! I'm not sure we would be able to wait the 3 or 4 days it takes to transfer the funds. I walked the 12 mile round trip to and from work yesterday and today.. not fun in Florida heat, but I don't mind.

After this experience though, I'll probably trim the checking a little and move the funds into our savings account.

Thanks to everyone for all of the good ideas. I'll update this soon with our changes in lifestyle and we'll see if things are going better for us!

_________________
"Our problems are man-made, therefore they may be solved by man. And man can be as big as he wants. No problem of human destiny is beyond human beings."

-John F. Kennedy, speech at The American University, Washington, D.C., June 10, 1963


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PostPosted: Tue Aug 26, 2008 10:15 am 

Joined: Fri Aug 31, 2007 7:48 am
Posts: 286
Ouch, ever consider a $30 bike in case of emergencies and local travel?

I live in a college town in northern California where there is hardly any new development, so of course there's a huge demand on housing.

Have you considered an Electric Orange ING Checking account? That way it won't take several days to transfer stuff from your emergency fund. I do this with ETrade savings and checking, it has saved me more than a few times since I pay my rent out of my ETrade checking account.


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PostPosted: Tue Aug 26, 2008 11:26 am 

Joined: Sun Jun 10, 2007 3:19 pm
Posts: 620
mallow wrote:
Have you considered an Electric Orange ING Checking account? That way it won't take several days to transfer stuff from your emergency fund. I do this with ETrade savings and checking, it has saved me more than a few times since I pay my rent out of my ETrade checking account.


I quite like my Electric Orange account. It's a little bit weird to get used to -- the business model is different from other checking accounts -- but after a little bit of adjustment, I find it's much more in my favor than regular checking accounts and I'd never want to give it up.


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PostPosted: Tue Aug 26, 2008 3:26 pm 

Joined: Thu Mar 20, 2008 3:22 pm
Posts: 52
Location: Florida
Daedala wrote:
mallow wrote:
Have you considered an Electric Orange ING Checking account? That way it won't take several days to transfer stuff from your emergency fund. I do this with ETrade savings and checking, it has saved me more than a few times since I pay my rent out of my ETrade checking account.


I quite like my Electric Orange account. It's a little bit weird to get used to -- the business model is different from other checking accounts -- but after a little bit of adjustment, I find it's much more in my favor than regular checking accounts and I'd never want to give it up.


Is the electric orange purely online too? How do you get your money INTO it? Direct deposit only? I don't have a direct deposit option... would this work for me?

_________________
"Our problems are man-made, therefore they may be solved by man. And man can be as big as he wants. No problem of human destiny is beyond human beings."

-John F. Kennedy, speech at The American University, Washington, D.C., June 10, 1963


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