Finance

Shopping Strategies

I’m not a coupon queen or a penny pincher, but I love feeling like I get my money’s worth. The following is a list of EASY practices I use to save time, money, and frustration.

  1. Always operate within a budget. The one way to guarantee buyer’s remorse is to spend more money than you have. Just remember, being in style and having the latest and greatest isn’t a necessity. Shop Goodwill if you like or must. Also, when you limit yourself, it’s easier to say “no” to impulse buying. For added savings, use cash. People statistically spend less when they hand over paper as opposed to swiping plastic.
  2. Routinely clean out closets and drawers. Rather than waiting for spring-cleaning, if you take 20 minutes once a month to peruse and remove items you no longer use, even if it’s only a handful of things, it makes a big difference. An item you might not have been willing to let go of for several months in a row might be much easier to toss if you keep seeing its uselessness month after month. Also, it’s a good idea to keep a donation bin somewhere in your house or garage so you have both a reminder and easy access to toss things.

3.  Only shop a few times a year, and shop with a mission. If you routinely weed things out of your life, it’s easier to see what you actually need when you go shopping. Make a list of necessities and spend your budget in one fell swoop instead of piddling it away on meaningless shopping trips where you blindly look around for something to jump out at you. When you make a list and come home with exactly what you need, there is no guilt in spending a larger quantity of money (as long as you stayed in budget).

4. Shop for needs, not wants. It’s easy to get sidetracked by things you all of the sudden realize you “need,” yet strangely didn’t until you saw it. Walk away from those items. If it truly is a need, you can add it to the list for the next time you go shopping. I have rarely returned to get that thing I thought I needed. Also, make a practice of using up or wearing out what you already have before shopping for a replacement. This will help you readjust your financial priorities.

5. Buy quality instead of quantity. For the longest time, I purchased a new purse every year from Target or some boutique store. I never felt I could afford the price tag on a designer purse. What I realized is that if I had saved my money from the constant cycle of purchasing cheaper bags, I could actually afford a designer bag that I really wanted. So that’s what I did. I saved and bought the designer purse of my dreams seven years ago and I still use it today, and probably will for many, many, many more years to come. That corrected the constant revolving door of purse purchasing, which means I save money in the long run. I’d much rather have fewer quality items than a closet full of cheap stuff.

6. Don’t fall for sales gimmicks. A sale on a new $1,000 television will tell you that you’ll save $250. But, if you’re not in the market for a new TV, and you purchase it, you will not have saved $250. You will have SPENT $750. I also hate places that tell you the more you spend the more you save. The truth is, the more you spend, THE LESS MONEY YOU HAVE. It’s only a good deal if you’re actually in the market for that particular item.

7. Avoid quantity buying from particular stores. One of the best sales gimmicks has to be stores like Bath and Body Works who charge an astronomical amount for one bottle of lotion. But, if you buy 6 bottles, the price dramatically drops. To be honest, I don’t need that much fragrance in my life. I’m on their mailing list so I often receive a “free item” coupon in the mail every so often. I use that to get my lotion and consequently have not purchased any fragrance from them in the last six months (let’s not talk candles, though!). Of course, if you don’t have access to a free item, and you’re completely out of fragrance, I would say you’re safe to buy. However, don’t allow yourself to purchase again until you’re on the very last item of your stockpile.

8. Be patient for sales you know will come. This past April, I needed new shorts. I found a couple pair that I loved, but they weren’t on sale. I walked away and waited. Sure enough, within 5 days, the shorts were on sale for 40% off. I know people worry about places running out of their size, but, especially at boutique shops, they will order your size for you if they don’t have it in store and have it shipped to your home free of cost. In the end, I paid almost half of what I would have paid had I not waited less than a week for the sale.

9. Don’t take your tags off when you get home. Things sometimes look great in the fitting room, but when I pair them with items I have at home, reality does not match up with my vision. When I get home, I put on newly purchased items and pair them with what I thought they might go with. Also, take time to sit down, cross your legs, bend over, etc. in your item to make sure it doesn’t do anything funky that you will later find annoying. If I decide I’m keeping it, I place it back in the bag with tags still on and wait until it’s actually time to wear it. Just this past overhaul, I ended up taking 6 items back to the store because after 1-2 weeks, I realized I really didn’t need the item or I didn’t like it as much as I initially thought. So, I went and got my money back.

10. As you purchase new items, be willing to let go of old. When I purchased a new swimsuit this year, I got rid of an older one I didn’t wear very often. New pajama pants? That means it’s time for an old pair to go. Keep clutter at bay by making your purchasing and donating a revolving door. Plus, it makes getting dressed WAY EASIER when you have fewer items from which to choose.

11. Check for sales after you purchase full price items. Just a month ago, I had several Macy’s gift cards I wanted to use. After shopping their website, I purchased an item I liked. It was full price, but I didn’t mind too much since I wasn’t using my own money. Two days after my purchase, I happened to look back online to see that my item was not only on sale, it also boasted an extra 30% off. A quick call to Macy’s and they were more than willing to refund me the difference from what I paid, resulting in $61 back in my pocket. There are many places that will refund money if you price check with them within a certain amount of time.

At the end of the day, setting a budget and purchasing only the things you need and truly love is one of the simplest ways to save money. I like to use my money wisely, and that means not letting it jump out of my hands every time I walk into a store. Yes, easier said than done, but after a little practice, it becomes habit.

Finance

Our Personal Journey Part IV

With Brent’s unexpected promotion, the second time I stayed home wasn’t the tight financial experience we had the first go around. It was still a difficult year with his travel schedule and getting me to the point to accept medication as a viable option to help control my depression, but at the end of the year, it made complete sense why God had led me back home. No doubt, we would have fallen apart if I had been working full-time.

Remember that dream home we bought that needed a lot of work? Over the 5 years since we moved in, we have saved and paid cash for some much needed upgrades:

  • Put on a new roof
  • Have the entire outside repainted
  • Repaint the entire inside
  • Buy a new washer and dryer
  • Buy new stainless kitchen appliances (microwave, range, dishwasher, and fridge)
  • Purchase a new formal dining room set (we didn’t have a dining room in our former house)
  • Purchase a new bedroom set for our daughter (her nursery had been piecemealed together, and once she turned 5, we decided she needed some decent furniture)
  • Install a new AC unit
  • Decorate areas of our home
  • Buy a backyard patio set (our former house didn’t have a formal patio)
  • Complete random miscellaneous improvements that can add up (install new light fixtures, change our whole house to LED lighting, install new door handles, etc.)
  • We’ve also been blessed to save and do things other than home repairs during this time as well (Disney annual passes, vacations, travel, concerts, etc.)

We were able to do all of this without ONE, SINGLE PAYMENT. I don’t say all of this to brag (because our home is still a long way from “dream” status), I say it to explain that if you’re willing to be patient and pay cash, you can accomplish a lot without dealing with payments, stress, and tying up your income.

 
Our home after a new roof and fresh paint. What a facelift!

So what are the things still left that we’d love to save for?

  • Master and guest bathroom remodels
  • Kitchen remodel
  • New flooring throughout the house (yes, we still have the same carpet/tile/linoleum that was installed when the house was built)
  • New formal living room set (we currently have an almost empty room in the house)
  • A pool

Obviously, those are some hefty price tag upgrades. In all honesty, we could have chosen to finance some of these projects and made the payments fit in our monthly budget even without me working. And let me tell you, on hot summer days, I’ve been tempted to add a pool to our backyard!

So, with me at home and Elizabeth approaching kindergarten, we had a decision to make: completely scale back our budget and send her to private school or send her to the A-rated public elementary school that was within walking distance from our house. We opted to try public.

She attended for 3 weeks and was not thrilled with school. Trying to get her ready each morning and complete basic homework each night was a struggle. And Brent was still traveling.

But, he finished his last trip (for a good long while) and returned home a few days before I received the phone call…

It came from my former place of employment. Their new English teacher for the 2015-2016 school year had quit three weeks into school. And that’s when one of the women in administration I admire and respect asked if I’d be willing to come back and at least step in until they could hire a new teacher. I really wasn’t interested until I heard that the 9th grade students I had taught the year I left would be on my 11th grade roster. I had already invested so much into their education, I didn’t want to see them lose ground. The decision became personal for me, and I decided to set my pride aside.

If Brent had still been traveling, the answer would have emphatically been “no.” But, I figured it was worth a conversation. At first he didn’t support me returning, even on a temporary basis. But, the thought of this gig only lasting maybe a few weeks to a month eventually eased his mind and he gave me his blessing.

So back I went.

A week and a half in I decided that I couldn’t just leave my wonderful 11th grade students hanging. I tried to envision what their junior year would look like if they ended up with three teachers before the year’s end. For many of them, it wouldn’t prove productive. So I prayed and decided that I needed to carry them through to the end of the year. I let my boss know, I signed a contract, and Elizabeth was moved to the school where I taught.

We saw God’s hand move as he placed me back at work for that year.

  1. We came to realize that Elizabeth needs, at this time, to be at a private, Christian school. The difference I saw in Elizabeth and her attitude toward school was incredible. Getting her out the door each day was no longer a struggle, and she loved doing her homework. It also gave us peace of mind knowing that like-minded teachers and staff were instructing her every day.
  1. I had a handful of students who desperately needed me last year. I probably did more counseling last year (for a variety of reasons), than I have in my entire career. Sometimes it was as simple as being a shoulder to cry on or a place to hang out during lunch when they just needed some space. Other times, it was helping them work through major life decisions.
  1. Remember our first house we were renting out? We finally came to a place where our last renters moved out and we thought we might be able to sell it, especially since it wasn’t profitable (the rent checks we received each month didn’t even cover the mortgage. On top of that, we owed $185 in HOA fees each month, and the general cost of repairs had caused us to bleed money each month for 5 years). But, we had some improvements we needed to make just so we could break even on what we owed on the mortgage. Plus, we knew we’d be paying a double mortgage while it sat on the market. Having my paycheck allowed us to let it sit vacant for almost 5 months while we fixed it up and had it listed. It finally sold (we lost a ton of money from the original purchase price), but we were freed from the burden.
  1. I had such a cynical attitude towards the school from being deeply wounded and wronged and God showed me I needed to work through it. When I left this past May, I did so without resentment. That year gave me the time I needed to heal.
 
With some of my creative writing kids. They were a hoot!

So things were running smoothly, our paychecks were allowing us to do a lot of cool things (we had brand new categories in the budget that were just stinking awesome), and it was nice knowing that I could press the eject button whenever I wanted if things got too stressful.

Up until that point, Brent and I had been trying to get pregnant for almost 3 years, when I resigned to the idea that it just wasn’t going to happen. We were a one-child family. I suddenly started routing out a new vision for our future. I saw myself working for the next 5 years to pay off our home and then returning home once that huge goal had been accomplished.

But, just as we make plans, God reveals something bigger and better.

Half-way through this past school year, we surprisingly discovered we were expecting. And, just like that, my heart told me I belonged at home…again. God had blessed us with extra income for those 11 months to help us get through what would have been a worrisome, money-depleting patch. I was able to help my students who needed me, Elizabeth was moved to a Christian school, I worked through my resentment, and we were given the time and money to sell our first home.

So here we are, full circle. Remember that pool I would have loved to finance? Or that master bathroom remodel? We could have afforded the payments in our monthly budget. I could be floating in this hot, hot, heat, sipping on lemonade, or relaxing in a luxurious bath spa with no worries…

Except the absence of those payments are the very thing that frees up just enough space in our monthly income to pay for Elizabeth’s costly tuition.

Oh, yes, I could be floating, but our only choice for Elizabeth’s education would be public school. And right now, what’s working for her educational experience is more important than my vanity and life of “luxury.”

She’s in 1st grade, and while we are going to evaluate what is best for her each year, it’s nice to know we have a choice. If private school is the best option for her until she graduates, I probably won’t be floating in a pool until I’m 50. Some of the cool things we had fit in our budget for that one year have since disappeared. We aren’t currently able to save for vacation or a new car. Our meals out will be a lot less. I might not have a brand new kitchen or bathrooms or flooring, but that’s what parents do for their kids, right? They sacrifice and defer some of their wants and desires to do what’s best for their offspring. All of those things are just “stuff.” Believe me when I say I wish I didn’t drive a 2001 mini-van that has chipping paint and a huge dent in the back, but I wouldn’t trade it for how I’m currently able to use our money to invest in my daughter’s life. I’ll have a luxury car one day, but for now, we’re just not in that season of our lives.

So yes, as I sat and peacefully drank coffee after my daughter left for her first day of school this year, I thank God that we can write that hefty tuition check each month because of our healthy financial habits over the last seven years. If we hadn’t taken that first step then, you’d be seeing a completely different portrait now. Probably one that included all of our fleshly wants and desires, but not one in which private school would be an option.

 
Me, doing what I do best! 🙂

Take that first step. For some of you, getting to a place of financial freedom might be as simple as 6 months. For some, it could be what seems like an overwhelming number of years. But how do you eat an elephant? One bite at a time.

 

And better yet, if you’re a student who hasn’t entered the world of debt yet, I guarantee if you start practicing financially healthy habits now and avoid debt at all cost, you’ll probably get to retire early with a ton of money! No, seriously! Debt eats away at your future. It’s never too early to start healthy habits to set you up for success later!

Finance

Our Personal Journey Part III

If you didn’t read parts I and II, they are here, and here.

With our debt paid off, renters secured for our first home, new work-in-progress dream home purchased, and a wonderful nanny to take care of our daughter, I did something I never thought I’d do again: head back to work. But it was clear that this was the path God currently had for me.

 

 
My classroom.

Life felt much different with my salary (of course we were paying top dollar to have an in-home nanny). But still, we had some breathing room, and it sure felt like Christmas to me!

We finally managed to make it past Dave Ramsey’s first three baby steps:

Step 1: Have $1,000 in an emergency fund

Step 2: Pay off all debt (except mortgage) using the Debt Snowball

Step 3: Save 3-6 months living expenses in a designated “emergency fund”

While we were working on Step 4 (invest 15% of household income into Roth IRAs and pre-tax retirement funds), we were also able to start saving and doing some small projects around the house to help improve its condition.

My second year back to work, just as I got used to expanding some of our monthly budget categories and adding money to areas that had never existed before, I was faced with a hard decision: whether or not to finish my graduate degree. The program that I had started three years prior had to be completed within five years time of the start date. I knew it would make me a better teacher and make me an even greater asset to the school.

But it could only happen one way: cash flow the entire thing. It meant we’d have to put a girdle on our budget once more. Brent and I decided it was something I should do, so I started the difficult process, this time as a full-time English teacher, wife, AND mom. I spent most weekends locked in my bedroom, reading, studying, and writing (not to mention the work I had to put in as a teacher creating plans and grading high school essays on a regular basis). There were even times I went back to work after school hours just to grade essays and work on lesson plans.

 
My desk view at 8 p.m. one night.

My third year back to work was the most stressful. We were called to host an international student for the school year. Let’s just say it was a very, VERY difficult year. In the midst of the drama and stress of having a teenager from another country living with us, we were dealing with a stressful health issue with Elizabeth that had already been going on for two years. On top of that, I was teaching full-time and working on my final semester of grad school.

But we pulled through. I graduated with my M.Ed. that winter with a 4.0! Brent and I knew that one of the fruits of my labor would be a much-deserved raise (an exciting ordeal when you’re on a teacher’s salary).

Over the course of the entire program, we had cash flowed $30,000 (tuition, books, and fees), and wanted to see ourselves recoup that money in a reasonable amount of time. The school where I taught boasted a million dollar teacher endowment fund, so while part of me was concerned my raise might be nominal, I expected to be taken care of.

I sent an inquiry to HR about what kind of raise to expect. And I waited. And waited. And waited for an answer.

By God’s providence, I was home sick the day I received the emailed response of my inquiry: The school no longer provides compensation for higher education of its teachers.

I.could.not.believe.my.eyes.

It made no sense at all. I started crying, thinking, what in the world did I just complete that $30,000 program for? I couldn’t tell you one school that doesn’t encourage and compensate its teachers for bettering themselves by obtaining advanced degrees.

I was devastated. I was hurt. I was angry. I felt abused.

Sobbing, I called Brent and shared the news with him. It was clear: I absolutely COULD NOT work for a school where I didn’t feel valued (isn’t that true of any place someone works?) It wasn’t about the money itself. We didn’t need the money. It’s about feeling valued.

And then I let the words come out of my mouth: Maybe I should just stay home again.

I couldn’t get those words out of my head the rest of the day and I began praying. By the time Brent came home from work, I told him I really thought staying home might be what I needed to do. We had barely survived the drama of the year, so maybe I needed time off (forever). He agreed to the notion as long as I could make the budget work (I’m the CFO of our household, a position Brent happily gave to me).

 
It was hard to leave students who I’d had under my wing since their 9th grade year.

I didn’t care if we went back to beans and rice, rice and beans, I was staying home.

I handed in an unsigned contract. I didn’t ask for a raise, I just expressed my disappointment that such a decision had been made. And sure enough, when I walked out the door, they reissued my contract (with a raise) in attempt to save me. But, it was too little, too late. I was so disappointed in the school I had come to love. A school that told me what an asset I was. They had proven it was nothing but lip service.

So our budget got scaled back once again, not as tight as the first time around, but not with the squishiness I had come to enjoy. But we felt at peace.

 
I graduated with the graduating class that year.

That summer as we were looking at my final paychecks, things started to take a financial nosedive. We sunk a decent chunk of our emergency fund trying to fix our AC over the course of two months. We were facing having to have a new AC put in (the current one was only 3 years old). Then, our renters called and said they would be moving out. The thought of possibly having to pay two mortgages for an indefinite amount of time before we could get new renters made my head swim. We would surely run out of money.

I looked at Brent and told him maybe I had made a mistake. Maybe I needed to get a job (certainly not teaching, though).

But he assured me that he felt like this was the direction God had told us to go, and that he would provide. He always had.

Weeks later, in the midst of my worry and doubt, Brent’s place of employment created a management position within his department, so he decided to interview. He was already the systems administrator for his company’s 5 national locations, so we knew a promotion like this would require even longer hours, travel, and greater commitment.

After weeks of waiting for the rounds of interviews to end, he was notified of his status: He was now in management! We didn’t know what to do with ourselves. His first new paycheck picked up right as I received my last one from the school. We didn’t miss one single beat.

God took what I thought was terrible news and used it to guide me back home, which is where I needed to be for the upcoming year.

With Brent’s new position came a crazy travel schedule (something he had done very little of before). It was challenging having him gone so much, but it would have been worse if I had worked full-time.

And remember the depression I had previously battled? It reared its ugly head again when I wasn’t suppressing it with the busyness of work. Looking back, I realize that I had still been dealing with it while working, it just made itself manifest in different ways, many of which were not healthy for me or my family. My self-coping strategies were no longer enough and I was forced to seek help, something that has been a game-changer in my life. I doubt I would have faced my demons if I had been working full-time, just trying to make it from day to day.

So all was well. Until I received a phone call a year later from my former place of employment…

 

I promise Part IV will bring things full-circle. 😉

Finance

Our Personal Journey Part II

Oh, man! I’m not even sure where to start because this was such a crazy, hard, eventful year for us. If you didn’t read Part I, it’s right here.

 
I’m so grateful to have him by my side. We do everything together, even the hard stuff.

Okay…

Once all of our debt was paid off, we had options. I was going to stay home with Elizabeth. However, getting rid of my salary and benefits, we knew it was going to be tight. But, this was something Brent and I both wanted for our family.

We were living in an 1,100 square foot home that had been purchased at the height of the real estate bubble. Brent was renting the house when we met, and when the owner decided to sell right before we got married, we chose convenience and decided to buy it with the idea that we would turn around and sell it a year or two later and then buy the house we really wanted…and then the economy crashed, and we were stuck!

 
Our first home

Our baby girl was born at the end of July, right as I received my last paycheck…

And when August hit, we didn’t know what hit us!

Phase 2 of our financial strategy

During that year (I always keep time according to school calendars- August through July), our small group decided to do a 13-week FPU study. Brent and I seriously considered not going. It cost $150 to get all of the materials needed (which was an excessive expense considering our situation). We figured since we already understood the pay cash for everything and avoid debt mentality, there wasn’t much more we could learn. THANK GOD we decided to go. That $150 was the best investment we’ve ever made! FPU is where we learned all of the practical day-to-day as well as long term stuff that really propelled us forward. We learned how to complete a zero-based budget, what kinds of insurance we actually need, the best ways to save for retirement, the best method for purchasing a home, and the list goes on.

One of the very first pieces of homework given in the class was to create a budget with your spouse. Ha! While we were living the cash-flow life, Brent and I had never really sat down and put our budget on paper. It was still just an abstract idea.

Brent admits now that he was terrified of completing this exercise with me because he honestly didn’t believe everything would add up (even though we were somehow miraculously making it to the finish line each month).

The whole point of the budget is to assign every dollar of income a place to go. It’s not just for bills. It’s what you plan on setting aside each month for savings, clothes, hair, dentist, medication, toiletries, eating out, vacation, car repairs, education…and the list goes on and on and on. The budget template is a FULL 3 PAGES LONG! It accounts for EVERYTHING!

So…we reluctantly sat down. And started. We filled in all of the things that had to be paid: tithe, mortgage, utilities, insurance, gas, food, etc.

Any money we had left over we used to sparingly fill in blanks for “secondary necessities.”

And then we were out of money.

We had zero dollars for the fun stuff: eating out, going to the salon, entertainment, vacation, etc.

To give you an idea of what our budget looked like, we were able to allot $320 a month for food. Let me tell you, I became the coupon/bogo queen. But we did it! I went from walking the grocery aisles, dropping whatever I pleased into my cart to writing a detailed list and walking around the store every week with a calculator to make sure I didn’t spend over my weekly allotment of grocery money. We were never in need and we learned how to be creative and not waste.

Other ways we cut corners:

  • I started dyeing my hair out of a box, which saved about $50 a month (I continued to do this for the next 5 years which saved us around $3,000 total)
  • We had already cut cable, but that alone saved us approximately $100 a month (by the way, we still don’t have cable and over all the years we’ve done without it, we’ve saved around $10,000 just by not having that monthly bill)
  • Brent picked up any side jobs he could
  • I sold stuff we didn’t need on eBay
  • If we needed new clothes or shoes, we shopped either second-hand or at Target. Sometimes I found deeply discounted items at boutiques or department stores.

And people wondered why we couldn’t just go out to eat last minute or join them on vacations. To do that, we would have needed the credit card because there wasn’t enough cash. But at this point, we were sold out on the vision our life could be if we put in the hard work on the front end. You see, a lot of people play in their early years and then they have to pay for it later on. We want to pay on the front end and play later.

But it was easy to start feeling sorry for myself. I’d see pictures or hear stories of people taking nice vacations, going out to eat, buying new cars, shopping until they dropped, or getting pampered at the salon. Brent would always remind me that we don’t know what another’s financial situation is. Some of those people might look like they are doing cool things, but they very well could be up to their eyeballs in debt. Some of those women might HAVE to work to keep up with that lifestyle. Even in my deepest pity party, I would agree that I wouldn’t trade the financial peace I was experiencing for all that stuff. Besides, our lifestyle wouldn’t be like this forever. That was our mantra when I started to feel sorry for myself: IT’S NOT ALWAYS GOING TO BE LIKE THIS. We are putting in the hard work and self-discipline now so that we can play regret/stress free later!

In a moment of total transparency, once we finished our budget sheet, I looked at the amount we were tithing (10% on Brent’s gross income), and I deep down wanted to pull our tithe so we could fill in some more blanks or at least expand some of the ones we had. God would understand, right? But, I also knew deep down that God would provide for us and bless our faithfulness. So, it stayed. And he didn’t fail us.

A New Home?

I’m a dreamer, so even in the midst of us having no breathing room in the budget, I started looking at real estate online. The market had bottomed out so it was both cool and quite depressing to look at homes twice the size of ours in a nicer neighborhood for less than what we paid for our little apartment-sized house.

And then I came across a short sale in a nice neighborhood that needed a lot of work and plenty of upgrades, but it had a ton of potential. There was even a fenced-in back yard where Elizabeth could play and where we could eventually put in a pool some day. Every once in a while, I’d check online to see if it was still on the market. I showed Brent the pictures, and he agreed it would be a perfect home for us, but the truth was, we couldn’t sell our current home to be able to buy a new one.

 
The picture of the house I saw online

But, I was in love, so we started stalking it. We drove by multiple times. The neighbor had a spare key so he even let us inside to see it. Ugh! It had the potential to be my dream house (with a lot of work). AND IT WAS TENS OF THOUSANDS DOLLARS LESS THAN WHAT WE HAD PAID FOR OUR FIRST HOUSE!

So I started praying. It was a long shot, but hey. Like I said, I’m a dreamer.

We figured if we could rent out our first home, we, by some miracle, could buy it. Knowing the bank would deny our low offer on what was already a short-sale, we went ahead and put an offer in anyway. I was afraid the bank would be insulted and not even counter-offer us. That was December.

I began praying every day. We only wanted what God wanted for us. If this wasn’t the right move at this time, we wanted God to slam the door in our faces. We didn’t want to follow our hopes and dreams off a cliff.

If you don’t know anything about short sales, it’s basically a waiting game. The bank will review your offer on their timetable and it can take anywhere from weeks to months to over a year.

So, I prayed.

And prayed.

And prayed.

Every.single.day.

I forced myself to pray for God’s will to be done, not for my human, selfish desires to come true. It can be a hard thing to avoid treating God like a genie in a lamp, but I knew his way was best. I told him I would be content, even if his answer was “no.”

A New Chapter

During the spring, I got a call from my former employer, telling me that my replacement had suddenly quit and they needed someone to come teach for the rest of the school year. But, I wasn’t interested. I had chosen to be a stay-at-home mom and that’s what I was going to do. I suffered from depression that year. Not because of our finances. I was depressed from the stress of being a new mommy and feeling like I wasn’t right for the job. I had not taken to mommy-hood very well.

 
I smiled for the camera, but it was a tough adjustment for me

But I was committed to staying home that year.

Later, I received another phone call asking if I would consider coming back just part time.

Nope. Not interested.

I received an additional phone call asking if I would come in to teach just one class, first thing in the morning, four days a week, just for the remaining months of the school year. I could bring Elizabeth with me and one of the ladies in the office would take care of her. It was such a small commitment. I decided that it might be good for me to get out of the house.

So back into the classroom I went. Four days a week for an hour a day. I taught my class and then came home and had the rest of the day with Elizabeth. Going back to work made me feel energized and started eating away at my depression. I was having actual conversations with people instead of being trapped at home all day (as an introvert, this was, unfortunately, my doing). This was the healthiest I had been since staying home. I honestly felt like it made me a better mommy. After a while, I considered going back into the classroom fulltime, and started praying about if that was what God had for us. Brent supported the notion if it was what I wanted to do. I called the school and was told the full-time job for the following school year was mine if I wanted it. So I prayed some more, and once I felt at peace, I signed a contract.

The End of the Waiting Game

Back to the short-sale. There was nothing but silence for almost 6 months. We were then told that our case was being reviewed. At the end of June, we received some shocking news. The bank didn’t want to counter offer. They accepted our initial bid and wanted to close in 30 days.

There was just one more hurdle: Since I didn’t have a salary yet, we would have to get our mortgage approved on Brent’s salary alone. On top of that, Brent and I agreed we would only buy the house if it was a 15 year mortgage as opposed to the traditional 30 year mortgage.

Miraculously, because of our (non)debt to income ratio, we were approved! The 15-year mortgage monthly payment was only a few hundred dollars more than the 30, which was perfect!

We also secured renters for our first home during this time so we were headed for closing only days before I had to return back to work full-time that August.

We found a wonderful in-home nanny to keep Elizabeth while I went back to work, one of the conditions to my returning (I personally would have rather stayed home than put her in day-care).

I’m so thankful I was able to stay home with Elizabeth her first year and wouldn’t trade it for anything. We learned a lot about what we really need in life versus “wants.” We learned how to be smart shoppers. We learned true contentment and delayed gratification. We learned to fully rely on God. With my new working status, coupled with the raises Brent continued to receive for his hard work, we were able to expand places in the budget and start trucking along toward some of our new goals…

And this continued on steadily for 3 years until I received terrible news.

But, that’s part III.

If you desperately want something, you’ll sacrifice and do what it takes to make it happen. One of the first steps to financial freedom and reaching your goals and dreams is knowing what the blueprint of your financial strategy looks like. If you’ve never written a budget, it’s the first step to making a game plan. It might be scary. You might be spending more money each month than you’re bringing in, but facing that hard reality is what will bring about change.

 

Those guardrails may be difficult to get used to and in some cases even be painful, but remember, IT WON’T BE LIKE THIS FOREVER. You’re working now so you can play later!

Finance

Our Personal Finance Journey Part I

I just dropped my 1st grade daughter off at her private, Christian school, and now I’m enjoying a relaxing cup of coffee as I type this. We are expecting our second child in two months, and I get the privilege of being a stay-at-home mom. I’m living my dream. And the best part? I’m not stressed about finances.

I could easily write off our current financial situation by saying, “we are blessed.” And, yes, we truly are blessed. But our current scenario did not happen randomly over night. We are blessed because of a seven-year process, seven years of life-changing habits, seven years of financial sacrifice and delayed gratification. Seven years of living below our means and working toward a common goal. We truly believe God has poured out his blessings upon our family because we have tried to be wise stewards of what he has given us.

But, it’s been a process. Sometimes a very hard process.

Everyone’s story is different, but I thought I’d go back and share our personal journey, if nothing more than as an encouragement to others who are ready to quit being normal. Our lifestyle is definitely in the minority, so as Dave Ramsey calls it, we are totally weird. But since America has a negative savings rate, we want to be anything but normal.

When Brent and I met almost 11 years ago, he had a decent job, but no savings. The one remarkable thing was that he had just paid off close to $18,000 on a credit card (hopefully those two trips to Europe were worth it)! He had a $393/month car payment on his Jeep Wrangler, but overall, his financial situation could have been much worse.

On the other hand, I was living on a low teacher’s salary and had about $2,000 in a savings account. I had a credit card I used every once in a while but I always tried to pay it off fairly quickly. My car (a little Saturn) was paid for and I had no other debt.

Brent and I have always inherently known that debt isn’t really a good thing, so I would not have classified us as big spenders when we got married. However, we bought into the idea that if we could “afford the payments” on something, that meant we could actually afford it. We didn’t mind using the credit card for things as long as we had a plan to pay it off quickly (about 3 months time was our max limit that we wanted to carry a balance).

I desperately wanted a car with power windows and locks, so I traded in my paid-off Saturn for a used Sebring, creating a car payment of only $250 a month. But I knew I could “afford” the monthly payment. When we got married, we wanted new furniture for our house so we started buying one set after the other. Because we believed we could “afford the payment” on our 2 years no-interest furniture, that meant we could actually afford the furniture. New furniture all for only a couple hundred bucks a month! What a deal! New carpet for the bedrooms? No problem. For a $100 a month payment, we could “afford” to do it.

Just look at this bachelor pad decor.

It needed a woman’s touch!

A lot of people think, “What’s the big deal? If you can write those checks every month and still be within your budget, doesn’t that mean you can actually afford those things?” That’s exactly what we thought. Instead, we were unknowingly typing up our income.

Although Brent and I weren’t spend crazy, we had no written budget. From the beginning, we had agreed to always communicate about money (the leading cause of divorce), but the extent of our communication was agreeing that we wanted our bills paid every month, and hopefully (fingers crossed!) no remaining balance on the credit card. We also consulted each other before spending any money for things other than necessities. I might go to the mall and find a dress I really liked, so I’d call him from the dressing room and tell him how much it was and ask him if we could afford to put it on the credit card with the hopes of paying it off very quickly. What I didn’t know was that Brent was trying to juggle an abstract budget in his brain. Almost always he would tell me that we could work it out. I had no clue the mental stress he was dealing with, and he didn’t want to tell me either because he didn’t want me to worry.

About a year into our marriage, we were encouraged by our small group leaders to take a Crown Financial course. So, we signed up for the one-day crash course version of the class.

Enter the beginning of our paradigm shift.

The focus of that Saturday was about getting out of debt.

What we started to understand was that affording payments is not the same thing as being able to afford what we were buying. Affording something meant paying for it outright so it immediately became ours. Otherwise, we were “slaves to the lender” (Proverbs 22:7). We might have brought our newly purchased product home, but we didn’t truly own it yet. The places we bought them from owned us until we could pay them back. The monthly bills became a ball and chain, not allowing us much freedom with our income.

If you added up our car payments, furniture, carpet, and miscellaneous credit card spending, we had about $1,200 of our paycheck each month heading out the door as soon as it came in! The light bulb went off and we realized that instead of paying other people that $1,200, we’d rather put it in our own pockets and do with it as we pleased. We wanted flexibility.

If we didn’t have debt, but we wanted a new (to us) car, we could simply pay that money to ourselves until we had the amount we wanted, and then pay cash! We would own the car as soon as we drove off the lot (not to mention you get a MUCH better deal when you pay cash and you don’t end up paying interest)! If we wanted new furniture, we could pay ourselves for a few months, and then purchase a set using cash. We would own it the day it was delivered! And the next month? We wouldn’t receive a bill. Instead, we would receive $1,200 that would go into our pockets instead of out the door. We could quickly save for the next thing on our list. What a freeing idea.

The thought of this freedom and flexibility set our brains on fire and we decided to throw every extra penny we could find at our debt (smallest to largest) to get to a point where we would be paying ourselves instead of other people. We cut back on our lifestyle and employed one of the greatest tactics to financial health: delayed gratification.

During the course of paying off our cars, furniture, and credit card, I changed schools and increased my salary by a bit. However, friendly pressure was put on me at my new school to obtain my Master’s degree so I could become an adjunct professor and offer my AP class as duel enrollment. With our new mentality, we had no choice but to cash-flow the classes I began taking. Thankfully, some of our smaller paid-off debts freed some money to do so.

My second year at the new school, we found out we were expecting our first child. This lit an even greater fire under our pants, and fortunately, we paid off every last penny we owed before she was born. Not having any debt is what gave me the option to stay home that first year with her. We owned our cars. We owned our furniture, we owned everything we brought home, which meant we didn’t need my salary to make those payments that are oh-so “affordable.” We had options.

That’s the funny thing about life. Things change. People lose jobs or receive pay-cuts. You enter a different season of your life where you need financial flexibility. Those once affordable payments are now restrictions on what you can do. Without debt, your money belongs to you, not a car dealership, a retail store, a credit card, or a bank.

But…, by completely cutting out my salary the first time I became a stay-at-home mom is where things got interesting. We experienced one of the hardest financial years of our marriage.

But that’s for Part II, right?

 

If you have monthly payments (car, retail stores, credit cards, bank loans, student loans, anything on a payment plan, etc.), my challenge to you is to add up all of the payments to see how much money could be going straight into your wallet instead of out the door each month. Multiply that number by 12 to see how much money you could be saving to purchase things in cash in only one year’s time. You might be surprised.

Finance

Christmas on a Budget

Ho! Ho! Horror Story! At least that’s what some people think when they get their credit card bill the month after Christmas. The holidays can be such a special time of year, but many people poison their fruitcake with financial cyanide.

The best thing to do? Budget.

The word “budget” often gets treated like a four-letter word, its association to people whose finances are tight. In reality, a budget is simply a written plan to dictate where your money goes. It allows you to control your money instead of your money controlling you. The wealthiest people in the world, no doubt, operate off of a budget.

So when I say “Christmas on a budget,” I don’t mean you have only a little bit of money to spend, I mean you have a game plan that will prevent you from having financial hangover the day after Christmas.

After writing a family budget six years ago, Brent and I have experienced zero Christmas money stress. Before that, we had some mythological number we spent during the holidays, we closed our eyes when we went shopping, and we just hoped for the best.

The idea is simple. Write a list of all the people/things you need to spend money on during the holidays. For us, this even includes categories separate from gifts.

These are the categories we have listed (all of them might not apply to you, or you might have additional ones we don’t):

Family (list each person by name)

Friends (list each person by name)

Boss

Employees

Kids’ teachers

Secret Santa gifts for anticipated parties

Service providers (I always give a gift card to my hair stylist every year. Just an extra “thank you” for making me feel gorgeous all year long)

Supplies (Christmas cards, stamps, wrapping paper, shipping costs)

Food (Are you planning on eating a special meal out during the holidays? What about extra baking or hosting family for a dinner at your place? It’s nice to pad your grocery budget with some extra room for additional expenses in this area)

Charity (Brent and I have traditionally adopted a family during the holidays. We’ve also filled shoeboxes for Operation Christmas Child, or have prayed for God to give us an opportunity to bless someone who needs it).

Miscellaneous (You might as well go ahead and anticipate that extra expenses are going to arise during the holiday season, something you forgot to budget. So, Brent and I always have an amount set aside as a safety net)

Once you’ve listed every possible person/category, set a reasonable dollar amount next to each item.

When you add up your entire list, divide it by 12 to see how much cash you should set aside each month during the year so you have the full amount in December. If you’re starting now, divide it by how many months you have left until Christmas.

If the monthly number scares you, that means you need to go back and adjust your budget. You might have to cut some categories or lower dollar amounts.

A few notes:

  1. Always set limits with those you exchange with. Communicate what your cap is. This takes away the guessing game and protects both parties from feeling like they “didn’t spend enough” or “spent too much” on the other person.
  1. Don’t be afraid of suggesting a non-exchange. Brent and I used to exchange with my youngest brother and his wife. Once they had their first son, we decided to get for our nephew while my brother still bought for us. Once Elizabeth came along, we no longer exchanged as siblings, but bought for each other’s kids. There are some people we have completely eliminated spending on by saying we will just exchange cards.
  1. Don’t let guilt make you run out and buy something. You know what I’m talking about. The unexpected gift given to you. Brent and I have had this happen on several occasions. The Christmas after we first moved into our new home five years ago, a neighbor down the street brought us a bottle of wine inside of a stocking along with some home baked goodies. We thanked them for the gift, but didn’t give anything back to them in return that year. What we did do was hang on to the stocking, and the following year, we returned the favor.

The same has happened at family gatherings. We’ve had people bring a small gift for Elizabeth when we hadn’t bought anything for their children. We thanked them and then the next year, we bought for their kids.

4. If you shop sales, you can actually spend the dollar amount in a category without actually “spending” all of the cash. You can stash the difference away for something else, or if gifts are your thing (like they are mine), you have freedom to buy an additional item or items in that category.

If you plan, save, and spend within the limits you set for yourself, you can relax on Christmas Eve as you take in the splendor of your Christmas tree. Brent and I always look at each other in the midst of the glorious glow and say to each other, “It’s so nice knowing that every single thing under that tree has already been paid for.”

We wake up the day after Christmas and feel a sense of relief. We won’t receive a credit card bill as a belated Christmas present from Satan…I mean, Santa.

…And then starting in January, we set aside our first installment of cash for the next Christmas and do it all over again!

Finance

Vacation Financial Hangover

It’s a beautiful Thursday morning. The sun is semi-shining, the AC is blasting, and I’m up peacefully sipping my coffee. There’s only one thing lacking: Vacation Financial Hangover.

About 7 years ago, Brent and I went through a Crown class that began our road to true financial literacy and freedom. But, it wasn’t until our 13 week experience with Dave Ramsey’s FPU a year later, that we dramatically changed our day-to-day relationship with money. There are so many things I could expand upon, and eventually will, but my focus this morning as I reflect is on our recent vacation.

The idea is simple: pay before you play. Brent and I firmly believe that if you can’t pay for something in cash (outside of a home mortgage-more on that later), you can’t afford it. Taking out a loan or choosing a payment plan is not affording something. For us, paying for an item outright is our only option. When we buy something and bring it home, we want it to be 100%, free and clear, ours! We don’t want monthly payments taking control of our income, nor do we want to pay extra for something because of interest that can accrue. Paying with cash dramatically changes your spending habits and allows you to focus on what you really need (which honestly, isn’t very much).

When we first began our path to financial freedom, there were people in our lives who didn’t understand why we couldn’t just “go in” in on a vacation rental or meet them out for dinner and other activities all of the time. Everyone has credit cards, right? But because of our new mentality, we needed enough notice to save cash for whatever large expense we would accrue. Or, if we were going out, there had to be money in the budget for it. Quite honestly, when we first began our journey, Brent and I didn’t get to do a lot of fun things because we were focused on paying off all of our debt. There are many years we lived on a tight budget (especially when I stayed home after Elizabeth was born and we were a one income household). It was hard turning down the invitation to “go and do,” and I found myself stuck in the middle of a pity party for myself. But then I would remind myself of what our future would look like with no debt, and I was able to refocus and realize that these tight times weren’t forever.

But, back to this morning’s non-existent financial hangover part.

 

Planning is crucial. Right after Christmas, Brent and I decided it was time to take a trip up north to see his family. But that costs money. Airplane tickets for 3, a rental car, gas for the rental car, food during our stay, Elizabeth’s birthday party and presents, and of course, some fun spending money (who wants to go on vacation and not be able to do anything?) We were fortunate enough to have our lodging taken care of for us.

We saved and shopped around for airline tickets and a rental car, and secured that as soon as we had the funds available. Next was saving cash for the actual trip. We decided that our magic number was $1,000 (you can obviously get away with taking a lot less, but that was our personal number). We didn’t think we’d actually need that much, but we wanted a cushion. Plus, we always find it a challenge to see how much money we can bring home with us at the end of the trip.

While we were up North for 7 days, we did the following things with our cash:

  • Paid for all of our meals with the exception of 3 dinners (we both grocery shopped and cooked some meals as well as ate out multiple times)
  • Paid for gas for the rental car
  • Bought a handful of new t-shirts and a hat from Ocean City’s boardwalk
  • Bought yummy treats on the boardwalk over the course of a few days (fudge, Johnson’s popcorn, saltwater taffy, ice cream, etc)
  • Played arcade games on the boardwalk
  • Bought food and hosted a cookout for 25 people to celebrate Elizabeth’s birthday
  • Bought Elizabeth’s birthday presents and cake
  • Enjoyed a pedicure (that was me, not Brent!)
  • Went shopping at the mall and made multiple purchases 

I’m sure I’m leaving out a few little things here and there, but Brent and I truly enjoyed our vacation. The biggest part of that was not stressing about how much money we were spending. Or as we used to do, close our eyes, swipe the credit card, and cringe. We knew once the cash ran out, we were done. And the best part of this trip? We returned home with $300 to spare!

That hasn’t always been the case. Our honeymoon was put on a credit card as well as any of the activities we did, so when we returned home from our week of “relaxation,” we were met with the stress of payments for several months after. That wasn’t our only vacation financial hangover. This is all too often people’s vacation stories.

I know for some of you, the idea of saving $1000 to take on vacation seems like a number you could never reach (heck, you’re just trying to pay the bills) and for others of you, that’s actually a small number to take with you. But for those of you in the former camp, there is hope. Brent and I have made many sacrifices since we started our journey 7 years ago, and we spent years getting our financial house in order…so now we are starting to enjoy the pay-off (I will be expanding on this in future posts). And while there were years that were just plain hard and we felt like we couldn’t do anything fun, we stuck to our plan, and now we are reaping the benefits.

You just need to take that first step. Develop a plan and work it.

The cash life is the only life for us, and it’s been an incredible experience.

Always, ALWAYS, pay before you play.