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Archive for February, 2015

Well, That's A Mighty Big Wrench....

February 27th, 2015 at 01:53 pm

I just got a call from my insurance agent's assistant (homeowners insurance on our primary residence). She wanted to give me a heads up that the home office had sent out an underwriter, who has decided that we need a new roof, and they will be sending us a letter to that effect. Apparently some shingles are curling in one area.

Now, to be honest, we've known the roof would need replacing *someday* and since my grandpa died 14 years ago, the roof is at least that old -- and it may have been last replaced before my grandma died in 1995. So they may not be too off-base, but even the assistant said in most of the pictures she saw the roof looked fine. We have a few homes in our neighborhood that desperately need a new roof, and there's a substantial difference between theirs and ours.

I guess the next step (well, after the snow melts!) is to get a certified roofing inspector to tell us how much life they feel the roof has left, and/or if it can be spot-repaired to get a few more years out of it. Apparently this is not an uncommon thing for insurance companies to do, and often if an inspector says the roof has a few more years in it the insurance will accept that.

If they don't, however, or if the inspector agrees that the roof needs to be replaced immediately, we're looking at about a $15K job. More than I have in the EF by a wide margin! I do have some options in mind already, none of them ideal and all of them involving adding debt somewhere. *sigh*

S is of course livid, and wants to switch insurance companies. Shopping around might not be a bad idea regardless (although they'll give us a 20% discount on our premiums the first year, then 19% the second year, etc.) but now that they've noted it needs replacing, any other insurance company will have the same requirement. I also do really appreciate the fact that the local office called to let me know the letter was on the way, rather than just letting me be blindsided by it. I would have totally lost it. They also are giving us a year to get it replaced -- very generous, as in some discussions I saw people were given 60 days.

I knew I shouldn't have answered that phone call!

52 Week Mega Savings Challenge - Done!

February 26th, 2015 at 06:54 am

Phew! My client paid their bill for my side gig, which finished up the 52-week Mega Savings Challenge -- with a couple of weeks to spare! Woo hoo!

Of course, I'm going to have to pull $2500 out in April for the new wall heater, but at least I have it there to pull! (They installed the heater a couple of weeks ago, but I put it off until after the Freedom card closed in February, so the payment won't actually be due until April.)

52-Week Mega Savings Challenge
My Weeks 50, 51 & 52

Snowflakes
Side Gig - $535.17

Total Snowflakes: $535.17
Rounding (to reserve): $0.17

Beginning Balance: $6325
Deposit: $535
[b]Ending Balance: $6890[b]

Reserve: $2.07 + $0.17 = $2.24

The reserve will go over to the regular 52-Week Challenge I'm doing this year.

I must say, this was a pretty tough challenge! I wasn't always able to save something weekly, especially once all of the smaller amounts were used up, but fortunately some bigger things came through that covered multiple weeks. I might do it again in the future, but I think I'll stick with the regular challenge for a while! (At least until my credit cards are paid off; it made sense to me to rapidly get to $5K in the EF even though I still have cc debt, and the OCD in me wouldn't abide with stopping in the middle of the challenge, but that's also $5K that could have gone to credit cards.)

So relieved to have this done! The regular challenge should seem like a piece of cake now. Smile

Challenges

February 25th, 2015 at 09:47 am

February was a month full of challenges, and March looks to be the same. This is my busy time at work, when I switch from four days and 30 hours a week to six days and 58 hours a week. I've been doing double-duty on the savings challenges, trying to finish up the mega challenge that I started late in 2014 while working on the regular challenge for 2015. I decided to give up buying lunches for Lent, which means I've had to challenge myself to be prepared every day and have something ready to take from home. In March I'll be increasing our 401(k) contributions and decreasing our withholdings, which will challenge our budget a little bit. I am trying to lose some weight for our upcoming trip to Napa at the end of April - S won the President's Club award at work and so we get a most-expenses-paid trip. (Actually the one couple who went last year said they didn't spend a dime of their own money, but I expect we'll have a few out-of-pocket expenses.)

Lent
It's only been a week, but so far, so good. I had leftovers from dinner all of last week. On Sunday I made a batch of egg muffins (basically scrambled eggs with ham, tomato, cheese, and mushrooms baked in a muffin tin; some recipes have you put hash browns on the bottom as a 'crust' but I didn't have any handy) and then cooked up a pot of rice, a couple of lean chuck steaks, and some peppers and mushrooms, so I've had stir-fry over rice all this week. (It ended up covering four lunches, but I'll have leftovers for the other two.)

The breakfast wasn't really part of the Lent challenge, but I often pop into the grocery store on the way to work to pick up breakfast and lunch, and figured there's no sense going just for breakfast. Cheaper and healthier to make it at home, anyway! I found a recipe for peanut butter pancake muffins with strawberry-cream cheese 'frosting' I want to try for next week. (I'm also testing these recipes; my sister and I decided instead of a present she didn't need, we were going to treat my mom to brunch once a month. We're having our "Family Financial Summit" in March so I figured we could do an in-house brunch on the same day. Muffins/cupcakes would be easy-peasy and they look cute, too!)

52-Week Mega Savings Challenge
My Weeks 48 & 49

Still waiting on my side gig payment, which will cover the last three weeks of the challenge. S's work revamped the way they figure insurance premiums for 2015 (they had four tiers and are now just using one), which means our premiums went up more than usual. Since we participate in the "extra-curricular wellness" activities, they gave us a 'benefit offset' payment to I guess ease the pinch a bit. (We'll get half of the amount next year, too.) It will hit on Friday, so I'm using a portion of it to round off this challenge. (The rest is 'holding' right now, I might need it if this side gig payment doesn't come through!) I also got a payment for a portion of the December rent that I thought was offset by some work they did on the house, but apparently not.

Snowflakes
Benefit Offset - $119
Rent - $246

Total Snowflakes: $365.00
Rounding (to reserve): $0.00

Beginning Balance: $5960
Deposit: $365
Ending Balance: $6325

Reserve: $2.07 + $0.00 = $2.07

52-Week Savings Challenge
Week 8

Smaller snowflakes here, which are much easier to come by! I save $2.99 at CVS the other day, and was paid $34.50 for some writing.

Snowflakes
CVS - $2.99
Writing - $34.50

Total Snowflakes: $37.49
Rounding (to reserve): $0.49

Beginning Balance: $137
Deposit: $37
Ending Balance: $174

Reserve: $0.06 + $0.49 = $0.55

This puts me at almost 92% of the Mega Challenge and just under 12.5% of the regular Challenge.

Muffinhead Moment and Lent

February 17th, 2015 at 01:48 pm

I mentioned the other day that I was changing our withholding and 401(k) contributions, and that it was going to be a big bite out of our monthly budget. I also mentioned that I got a raise and S will undoubtedly get a small one, too, which will help offset the changes. Still, I was looking at a decrease of about $525 per month and for the last couple of weeks it has been really kind of freaking me out.

Then all of a sudden yesterday the light bulb went on. I wasn't looking at the difference in income from our current situation to the new one -- I was looking at the difference of our income with the raises without making any other changes, compared to the income with the raises and changing the other things. The reality is that the raises really do offset quite a lot of the changes. We'll only be taking home $118 less per month, which is very manageable!

They installed the new wall heater yesterday. My only regret is that we didn't just do it a couple of months ago. It's a much bigger unit (well, it's distributed differently; the old one was mostly outside, this one is mostly inside) but still pretty unobtrusive, and it is whisper-quiet. Even on its best day, the old unit was loud enough to hear in the next room. This one you have to be practically standing next to it before you can hear it.

Today is Fat Tuesday -- also known as Paczki Day here. (I'm not actually a paczki fan, but I like to say "Happy Paczki Day". Wink ) Tomorrow Lent begins, and again this year, although we don't actually 'do' Lent in my religion, I've decided to give up something that will make a financial difference. Last year it was CVS, and half of those savings (based on the average from the previous two or three months) went to the 52-Week Mega Challenge.

This year I've decided to give up buying lunches, except of course during my regular grocery shopping. Which means I'll need to plan ahead a little bit better, since I often either run out for lunch, grab a can of soup at CVS, or stop by the store on the way to work and pick up something. I've wanted to work on this anyway, and have been doing a little better already, but Lent is a good solid jump start. It's a hard number to pin down, because some days I do bring lunch and some days I have a $1 can of soup, but even figuring an average of $7.50 per lunch three days a week, that's saving $90 a month -- almost the entire shortfall from above. I'm not drinking pop as much, either (as in, almost never but I refuse to completely eliminate the possibility), which probably saves at least $30 a month, and makes up the rest of the shortfall.

I am reserving the right to one lunch out during Lent, though, because I was too busy today to do a Fat Tuesday celebratory lunch!

Chase Freedom Rewards & 52 Week Challenges

February 14th, 2015 at 09:22 am

It was a great month for my Chase rewards! This is the 10% bonus month, based on last year's rewards (I think this is the last time they're doing that, though), plus it's 5% at grocery stores this quarter.

I've projected an average of $50 per month in rewards; this month was much higher, at $189.01 - woot! This pays off my movie card fund. I still have about $40 on the last card and two passes. I have no immediate plans to see any movies, but once I do, since I can't watch a movie without popcorn, it adds up! I still haven't decided on what to do with the remainder; for now I'll let it sit, but if I get down to the wire on my Mega Challenge I may use it for that.

Movie Card Fund
Goal - $100
Balance - $100.00
Remaining - $0

Excess - $124.20


52-Week Mega Savings Challenge
My Weeks 46 & 47

Snowflakes are still a little slow, but they are trickling in. It helps to do multiple weeks at once, with the larger amounts of this challenge. I do have a payment from a side gig coming in, which will cover three weeks of the challenge. That leaves me with two weeks to cover in the next three weeks -- it will be tight, but I've got some thoughts about how to get there!

Snowflakes
Return - $143.39
Found Money* - $2.00
CVS Savings - $20.08
Freedom Rounding (Jan) - $38.91
Joann Savings - $30.78
Writing Gig - $36.50
Reimbursement - $22.48
Vonage Savings - $26.05

Total Snowflakes: $320.19
Rounding (to reserve): $0.19

Beginning Balance: $5640
Deposit: $320
Ending Balance: $5960

Reserve: $1.88 + $0.19 = $2.07

52-Week Savings Challenge
Weeks 3-7

Snowflakes
Critter Prize - $5.00
Checking Rounding - $9.85
ING Interest - $5.11
Chase Interest - $0.03
MSD Interest - $6.52
Found Money* - $28.00
Freedom Rounding (Feb) - 33.54

Total Snowflakes: $88.05
Rounding (to reserve): $0.05

Beginning Balance: $49
Deposit: $88
Ending Balance: $137

Reserve: $0.01 + $0.05 = $0.06

*Again, not as exciting as it sounds, just money I'd stuffed into a pocket or bag and forgotten about.

This puts me at almost 86.5% of the Mega Challenge and just under 10% of the regular Challenge.

Catching Up

February 14th, 2015 at 08:35 am

I've started several 2014 wrap-up/2015 goals posts, and never get around to publishing them, because a) I start yammering on and b) it gets too depressing!

Some days I feel great about where I am -- I've paid off a lot of credit card debt and have a good start on an emergency fund -- but then I do my yearly budget projections and end up $10-15K in the hole by the end of the year. (I overestimate spending and underestimate income, but still....)

Then I did our taxes and we really need to change our withholding! We had claimed a high number of exemptions for a while, because with the rental we had a fairly decent loss to write off, but we don't get the full amount anymore and it's really affecting our bottom line. We owed around $2,800 last year; we have a small refund this year but only because we had a lot of stuff donated to charity, from his parents and my grandparents (finally cleaning out the basement, garage, and attic!). We won't have that next year, and without it we'd owe about $5,000 so it's time to make a change!

I'm also having us increase our retirement contributions; we're both putting in just the minimum to get the match right now. We aren't able to contribute directly to an IRA or Roth; a backdoor Roth won't work for S because has an existing IRA. I could do one -- I have a teeny tiny IRA and the tax on a conversion would be negligible -- but at this point, having it come directly out of my paycheck, and reducing my taxable income, is preferable. (Plus I actually think we'll be in a lower tax bracket when we retire, so tax-deferred is our better option at this point.)

Of course none of this helps our monthly bottom line any, but it's a necessary evil. We do have lots of areas where we can cut back, and I've already identified about $5,000 I won't be spending on a particular hobby this year. I also haven't included any side gigs I can pick up. Still, my focus has changed a bit for 2015, and rather than working quite so heavily on eliminating debt, I'm going to work more on not incurring additional debt.

I have a refinance to do mid-year, and potentially another one in the fourth quarter. The first will definitely ease up cash flow, and significantly lower our highest interest rate. (The second will probably end up being neutral overall.) I also have a small 0% balance transfer offer through August 2016. That combined with the refi will put my highest credit card interest rate at 3.99%, so I'm a little more comfortable about scaling back on repayments than I would be with the 24.99% I had a couple of years ago! (I will still pay some extra to the cards; paying just the minimums means I'm in debt until 2030! As of now this change will extend my payoff by one year.)

Unfortunately, we have decided that we really do have to replace the wall furnace that died on us back in November. We've been limping along with an electric space heater, but it doesn't do much on these sub-zero nights, and it's expensive to run! So that's $2,500 out of the EF -- the only good aspect being that at least I had the funds set aside!

My 2015 goal, then, will be to replace the $2,500 and get the EF back up to $5,000. Since I'm still finishing up the 52 Week Mega Challenge ($1,890) and doing the regular 52 Week Challenge ($1,378), I'll easily meet and exceed that goal. My original goal of $7,500 in the EF is a little ambitious now (given I still need to save up $3,700 for property taxes in September), but I think I'll stretch the EF goal to $6,000. That's only another $232 I need to come up with, which seems do-able.

(Actually my EF goal hasn't changed -- save up $2,500 this year -- it's just the final account balance that's changed because of the heater.)

Anyway, my other goal of paying off $17,500 in credit card debt is adjusted down to paying off $12,000. That includes a few 0% balance transfers that will come due this year. It doesn't include the one card I'll pay off with the refinance, since I'll still owe that money, just not on a credit card.

To end on a happier note, I did negotiate a 7% pay raise (which is a lot less than it sounds like!), which will help offset my increased 401(k) and withholding. S should get his standard 2% increase, which will help a bit, too.