Ktmarvels's Personal Finance Blog

Is it bad that I consider us to be debt free?

In reality we have a mortgage ($149K) and my school loans ($30K), but I don't really think about them. DH and I closed on our house in August, so we have a mortgage, but the only real change is that rather than paying rent to a landlord, we pay it to the mortgage company. So mentally there hasn't been a big change there.

Also the school loans will still be deferred until I finish in about 2 years. So since we aren't paying for them, I don't think to include them. Additionally with the exception of the first semester DH and I have only been taking out the subsidized loans. So while fellow classmates who need those loans to live off of, have about 100K in debt, I'll only have about $40. Another reason why I don't include it is that if push came to shove, we have the money to pay it off, we'd drain our savings, but technically that could be gone tomorrow. So maybe once the school loans come out of deferment I'll start feeling differently, but I doubt it.

So no, I still have debt, but we've got it under control, so I may slip and say we're debt free.

So DH and I closed on our house a week and a half ago. Since that day we have gone to Lowe's nearly everyday...I think I've only missed 2 of the last 12 days.

Thankfully most have just been little trips for paint and brushes. However one of those trips was a big weekend where we purchased all new appliances for the house. The house was 20 years old, and had mostly original appliances with no washer/dryer. We shopped well: went during the weekend where they had 10% off energy star appliances, a rebate on Samsung kitchen appliances, and used our 10% military discount. All in all, much worse than it could have been, besides we can take the washer, dryer and fridge with us when we go if we want!

DH made a little fuss about buying washer dryer pedestals. I think I'd like the extra height so I don't have to bend down so low to get to the front loaders. (Yes, I know you have to bend down for top loaders, but hey, it was my one sticking point. I offered that DH could do all the laundry if he didn't want to spend the money, but if I was doing laundry, I'd like the pedestals.)

Then the next day I just happened to wander back by the appliance section mentally I'd just checked off the appliance section, so wasn't even planning on going to that part of the store. I notice a sign that said if you buy any Samsung washer/dryer you get the pedestals for free, starting on Thursday...and we had purchased our appliances on Saturday. I was pretty sure that we were charged $200 a pedestal, so I talked to the appliance guy and he verified that the washer/dryer we bought would qualify. He said to check the receipt to see if we were charged, and if we were to bring it back.

Lo and behold, we were charged, so on my next daily trip to Lowe's I brought my receipt and was refunded the nearly $400. In addition to the money DH now can't complain about purchasing the pedestals...they were free!

DH and I will close on our house on Friday!! I feel like I've been talking to our mortgage company every day, but I think it's all coming together.

Today I was informed that the sellers agreed to pay more money than was allowed due to the particular circumstances. We had the sellers pay 3% of the selling price towards closing costs, that amount covers all the closing costs plus the $1000 binder and $350 fee to lock in the mortgage rate, which is great. The problem is that there is an additional $250 "owed" to us. Unfortunately it's not allowed for us to just pocket that $250, so our mortgage agent was calling to see what we wanted to do. Our options were:
1. Do nothing and forfeit that $250.
2. Use that $250 and pay $500 of our money to buy down the interest rate.
3. Use that $250 to help pay the VA funding fee, if allowed.

Well I don't like walking away from free money, so option 1 is my last choice. Option 2 doesn't make real financial sense. It would take 3.5-4 years to recoup the costs of buying down the interest rate, and I don't know that we'll keep it that long. So that leaves option 3. If our contract is written so that the money can be used towards the VA funding fee, then we'll take it. It won't really adjust the mortgage payment, but it will lower the balance to below $150,000.

Since so much is up in the air, I figure having cash on hand is better than having it sunk into a house that we aren't planning on keeping that long and we will be doing some upgrades to.

Well DH came home and we were leaning towards our condo right up until the time that he saw the house. The resale (and ability to rent) is better with the house. So Monday we put in a verbal offer to which they countered. So yesterday we put in another offer (written this time) and they accepted!

So in about 6 weeks we'll be home owners!

So I've been house hunting for a couple months now, mostly because the condo I've been renting from was going through foreclosure. The manager called it "loan modification," but the paperwork I was served with said foreclosure. I think I'll believe the courts.

Anyway that notice sent me from wanting to buy the condo we're in, to buying another condo in the same complex, to looking at any condo, to deciding I don't really like many condos, to finding 2 houses I like. So when DH gets home, we were going to look at our top 2 houses and decide if we want either one of them.

However yesterday I get a call from our property manager saying that the loan modification fell through and they are now doing a short sale. I believe she said they were approved for 90K and were looking to go even lower to 80K. As the current tenant we get first 'dibs' on the condo. Well this just brings us back to square one! So now DH and I have to decide if we should get one of the houses we liked or the condo we are currently in.

Pros of the Condo:
1. Half the price (80 or 90K vs 160)
2. We wouldn't have to move
3. We LOVE the location, it's really convenient.
4. We wouldn't have to worry about yard work or anything like that.
5. It might be easier to rent out.
6. If something goes wrong with the outside the HOA has to fix it.

Cons of the Condo:
1. It doesn't qualify for VA loans, so we'd have to have a down payment and last time I called it was a ridiculous 25%.
2. We'd have to pay HOA fees FOREVER, and it's $300+ a month.
3. When we sell it there are a LOT of condos in this area, so it will probably be pretty competitive.

Pros of a House:
1. It would be ours completely and fully.
2. We should be able to get VA loans and not have to put any money down.
3. Both houses are listed at 160, so the cost would be significantly more.
4. It could be a new start, the condo has been mine and my roommates, DH hasn't lived here yet. So that house would be "ours", the condo may still feel like "mine." Although I think I'd get over that quickly.

Cons of a House:
1. We'd be a little bit further from school and my friends, but closer to DH's work.
2. We'd have to buy all the fixings for a yard (mower, etc).
3. We have to worry about the outside and inside of the house.
4. We'd have to move.


So those are the main things I can think of right now. Any suggestions or thoughts?

I've now been out with the agent twice and have looked at a total of 8 houses. The first time I met with her the very first house we looked at I was hooked. It was beautiful with all hardwood floors and very large with both a living room and family room. My only hesitations were that the two bedrooms were close to one another and the hardwood floors would need refinishing. It was my favorite of day 1.

Then day 2 we go look at that house again along with 4 new ones. Looking at the house again I found a spot where there is a leak and it had soaked through the wall. Now this is something the sellers will have to fix, but it sort of sucks to know that at least part of the roof needs repair. Second, both times I've been there the backyard has been flooded. To make matters worse the entire street has drainage issues. To be fair we've had massive amounts of rain in the past couple weeks (on the order of feet). But we're still not sure if that's something we'll want to deal with.

On day 2 we also saw a house that is a great house, but is decorated very heavily in a country cottage feel. It's hard to see what the house will look like because I am so put off by the decorations, but it's nothing some hardware, paint, and a new sink can't fix. This one has a lanai and is right on a man made lake so no drainage issues there (and the house is quite a bit above the water).

So we have two houses that we like with some positives and some negatives. When DH gets home from deployment he'll get to see them and we'll probably put an offer down on one of them.

We found out in January that the condo we are renting is going through foreclosure. We've been paying (and continued to pay) our rent on time, but it is going through the process nonetheless. They say it is only going through Loan Modification, not foreclosure, but really it's all the same to us. Our lease is up in August and we've been holding our breath that we'll be able to stay in this place til then...looks like it will.

So during this process I got a wild idea to just buy the condo. We decided to rent this place with the idea that we'd stay here for at least 2, if not 3 years. So needless to say the realization that I'd have to move was not a pleasant one...I've moved about 5 times in the last 3 years.

So our condo is on the market, but listed at 175, the balance of the loan. In looking up the listing I found that there was a bigger condo in the complex that had already gone through foreclosure listed at 90K. I was really ecstatic and wanted to buy it RIGHT THEN! So I found a real estate agent and began talking to our bank.

Then the other shoe fell. I didn't like the agent I was working with. I don't think she was that experienced in buying/selling...I found her from people who had used her looking for apartments to rent, not places to buy. Then we found out that we couldn't get a VA loan on this condo complex because it was a conversion from apartments to condos. Our primary bank said they'd lend to us, but they'd require 25% down. 25%! I've never heard of that before. I figured that because of the poor economy we may have had to put 20% down, but 25% never crossed my mind. Now we actually had the money, but we hadn't been planning on putting that much down.

I called up other lenders and some flat out refused to lend for this condo. Apparently the high number of foreclosures and number of investment properties (versus primary residences) in the complex made it unappealing to lenders. So I finally found a bank that would lend to us, told the agent, and found out that someone else had already put an offer down.

I was devastated. At that price it really shouldn't have been surprising, but I was sad that we didn't act quick enough.

So I picked myself up again. I've already found a new agent...one that seems ok. I haven't dealt with her much yet. This one was recommended by the bank (USAA Movers Advantage, for those who know it). I drove all over town looking at nearly every condo complex to see if it's a place we'd want to live. Well 2 hours and 60 miles later, I decided that I didn't really want a condo. Figures.

So now were narrowing the search to single family homes under 160, but widening it in terms of location. We've already found some that are looking good. Now if only DH were here to help me! Less than 1 month left!

DH and I opened our Roth's in 2007. For our 2007 and 2008 contributions we did lump-sum contributions, working under the theory that that longer the money was in the account, the longer the money could grow tax-free. Well the market of 2008 certainly nixed that plan, so this year we have decided to do monthly contributions. Our first one comes out after payday this week.

I also looked at my social security statement and discovered that I have contributed *nearly* as much to my Roth as I have made working. (Again, thanks to the market, I don't have that much in the account right now, but I still have contributed that much.) Now for you math wizards out there, you know that since I've maxed out the account both years, I have contributed $9000. Adding up the money I made this summer to the amount reported on my SSA last year, I've made...*drum roll please*... $9100.
I know that's a pathetically low number. I did work for a couple summers as a nanny and that wasn't reported, but I doubt it was enough to even report. I try to look at the glass half full though...there are many people who would love to have as much in their retirement accounts as they've made!

Once I graduate and work as a pharmacist, that number will dramatically increase, so much so that we will no longer be able to take advantage of the Roth IRAs. That's while we're working so hard to fund it now!

So I knew diamonds were just about the hardest thing on earth, and the only thing that could really cut or scratch them were other diamonds. What I didn't realize how big a factor this would play in my wedding ring.

My mom and I were at the mall and she suggested having my ring cleaned. Most stores have your ring cleaned for free, but I never actually get around to it. So since I was at the mall that I actually bought the ring, I decided to do it. Immediately after I give the woman my ring she announces that several of the diamonds have chipped!

My wedding ring has 3 stones on the first band and a row of five or six much smaller diamonds on the second band. I never got around to getting the bands stuck together ("fused"), and honestly, I liked that they moved around. I didn't realize that every time they moved they had the potential of scratching and chipping! Thankfully only one of the 3-stone diamonds was chipped...and not the main one...and 3 (maybe 4) of the smaller diamonds. So 600 dollars later...I should have almost a completely new ring.

This now motivates me to 1. Keep up with regular cleanings to maintain my warranty...every 6 months at least! and 2. Get the jewelry rider on our renters insurance updated. The last time I called I found out that while I was insured for the total cost of my wedding ring, and other jewelry, the "per-piece" maximum is significantly lower than it would cost to replace my ring. So expensive lesson learned!

Last night at dinner DH and I were discussing our finances. For the first time DH expressed that he was worried about our retirement. Honestly, I couldn’t have been more pleased! Now, let me preface all of this by saying DH and I are 25 and we currently have about $17,000 in our Roth IRA. We have maxed out both of our accounts for the past two years and already have 2009’s contribution saved. Maxing out the accounts equates to between 15 and 20% of our gross pay. Even if we only did this for the remaining 40 years of our work life and earned 6%, we’d have over a million dollars. In reality, when I start working (if not before) we’ll open 401(k) accounts and probably even taxable accounts to save even more for retirement.

DH’s main fear stems from the fact that our Roths have been losing money. I try to tell him that eventually the markets will go up and we will make money. So far we have lost about 1300 dollars. I’ll fully admit that part of it is my fault. In January we deposited the entire amount and didn’t dollar-cost average. Before I did it, I was torn as to what was the best way. Looking back, dollar cost averaging would have been the way to go. However, I also heard the advice that by doing it in a lump sum, I would have the entire year for the whole amount to grow tax-free. I showed my naivety and thought the economy would bounce back quicker than it did. Oh well, lesson learned. I have faith that eventually the market will go up and we’ll make money. And you’d better believe we’ll be making monthly or bi-monthly contributions for our 2009 contributions!

It’s about that time of year again…student loan time, that is. I am starting my second year in pharmacy school and I’m still pretty new to dealing with student loans. Between my scholarship and parents, I escaped my 5 years of undergraduate work without any student loans. Pharmacy school, however, is a different situation. The estimate for school and living expenses is nearly $27,000. There is no way that DH and I could really swing that.

Going into my first term my financial future was a little shaky. We found out the day of orientation that DH would be moving to Maine…far away from me and school in Florida. Not knowing how that would affect our finances I took the entire amount of loans offered to me: $12,600. Tuition was taken out automatically and the rest, nearly 6k, continues to sit in my savings account untouched. Second semester my in-laws graciously offered to pay tuition. We accepted their money, but also accepted the subsidized loan. Maybe not everyone would agree with this move, but the way we figured is that government was giving us an interest free loan on that money for another 3 years or so. It also enabled us to max out our Roth IRA accounts for the year.

That brings us to this term. DH and I have now spent a year learning to juggle two households. I’m moving in with a roommate so some finances are still up in the air; I predict that my finances will be about the same, and maybe even a little lower than they were last year. So I once again only accepted the subsidized loan of $4250. I don’t know the exact cost of tuition, but I anticipate it will pay for just over half of it for the semester. The remaining 3000 or so will come from that 6000 from first semester last year. Ideally, that 6000 will cover the gap between the subsidized loan and tuition costs for both this semester and next semester, but we’ll have to see.

Assuming DH and I are able to finish up the rest of pharmacy school only taking out the subsidized loan I will have taken out $42,300. I just dug up my last statement on those student loans and it looks like I have been charged $480 in interest during the past year. So add another thousand or so for interest, and I anticipate the loan balance will be about $43,500. It’s a little scary to see that debt load. Even when DH and I had two car loans, we never had more than $25,000.

Here’s the good news. By only taking out subsidized loans we are actually saving A LOT in potential interest charges. Nearly 500 a year in interest is a lot, but it’s a lot better than it would be if we took out the maximum possible. Also, I anticipate that DH and I may have some extra money which can be used to pay off the interest charged, and maybe even pay down the balance some before I graduate. Although, even if we don’t get the money, or chose to do that, my total student loan debt will be less than 1 year’s salary. We plan to continue living off of DH’s salary so my income can go toward student loan debt, house down payment or mortgage, retirement, and whatever else comes our way.

What a crazy time! While all of our expenses have been crazy this summer, rent has been the worst, by far. Dh's rent is 690. My rent is 644. So we are used to paying 1334. However this month, when I return to Florida, I will be moving apartments. So I have to pay 644 lease termination fee and 1050 security deposit on the new apartment.

Normally this wouldn't be a problem, but our other expenses have been crazy AND we haven't been able to deposit my checks from work. So today I'll be going over to another bank to see if I can cash checks and get a cashier's check for the deposit.

Wow, I can’t believe it’s been two months since I last wrote here. Well I sort of can, the last couple months of school were horribly busy, not leaving me time for hardly anything! But now that’s over with and summer is here.

We’ve had some big changes financially here. First of all DH has been in Italy for the past 3 months. While it’s been hard to have him out of the country, it’s been very good for us financially. They get paid per diem, a set amount each day that they can spend on hotel or food or whatever they want. It’s amounted to nearly an extra 1500 a month for us! On top of that we got our tax return and some extra family separation pay so we’ve been able to fully fund our 2009 Roth contributions! I’m so excited that we’ve been able to do this and there is no way I thought it would be possible to do this early in the year. Now, I know that we can’t actually make that contribution yet, but it’s sitting in our savings account accruing interest until January when we make the deposit.

Funding our Roth IRAs has been my number one savings goal. When I graduate from pharmacy school I don’t know that we’ll be able to continue contributing to them because our income will probably be too high. I’m trying to make sure we take full advantage now, while we can.
Everyone is all excited about the economic stimulus money. I’m excited to think we’ll be getting some extra money, but I think we’ll only be getting $460, not the $1200 that was being thrown around. Although I guess I can’t really complain. We only ended up pay $460 in taxes, so to get that back, means we won’t have paid anything last year. In other tax news, last month DH entered a combat zone, albeit one that hasn’t had any fighting for several years. Since he did that though, his income for the month of May should be tax free. That will probably add up to another $500 this month, and save us down the road too.

Having my #1 savings goal met, I’ve been thinking about what to do with the rest of our ‘profits’. I basically consider whatever we haven’t spent by the end of the month our profit. I know a lot of people have to work backwards and take the savings out first, but thankfully DH and I have pretty low expenses and lately the government’s been throwing money at us. But anyway. Six months ago I realized that it wasn’t financially sound to pay of DH’s car early. We were earning higher interest in our savings account than we were paying in interest on his car. However, since the rates of the accounts have dropped so dramatically, and we’ve met our Roth goal, I think I’m going to start diverting some of our profit towards his car.

On top of all of this I’m starting my internship today. It actually will start on Monday, but since I didn’t know anything about the store, they’re having me come in today to get my feet wet. I’m mostly working for the experience, having never actually worked in a pharmacy it will be interesting to see the things I’ve been learning about put to work. However, I’m not going to refuse a pay check! Actually the company I’m working for has the lowest starting wage for interns, but as a customer I like their store the best. So it should work out. I’m still working on a transfer to Maine. DH comes home the beginning of June and I plan to spend the summer up there with him. It’s been too long since we’ve seen each other! So I’m heading up there regardless if I have a job or not, although, it would be nice to have some sort of job up there. Having this week off of school and not working has been torture!

Well I think that’s all of the major financial happenings that have been going on! Hopefully I’ll be able to post more now that school is out.

Today I transferred nearly all of our money out of our bank's saving account to my ING account. A year and a half ago, we did the opposite when our bank's saving acocunt was at a higher rate then ING's, but with the recent economy the rate has been steadily declining. So back to ING we go!

I haven't used ING for a while, but I know that you can set up different accounts. Currently I have a spreadsheet that I use to track different sub-accounts (Roth contributions, EF, down payment, etc). So questions for the people who have ING...do you have multiple accounts? Do you like it?

I just finished up our taxes last night. I started doing them at the beginning of February, but we kept getting more 1099s that I had forgotten about and my tuition forms hadn't been posted. This weekend I checked and they were finally up. Thank goodness I waited, our refund nearly doubled due to the amount of tuition we've paid this year.

I'm a little surprized at how much we'll be getting. Part of me is temped to spend it, especially since I have a spring break trip to Key West coming up. But before I do anything too rash, I'm going to earmark it for our 2009 roth contributions. This will hopefully make me think twice before raiding it. It's also crazy to think that we'll be having such a huge jump on our 2009 contributions!

Anyway, the program I used (Tax Cut Free File) states our marginal tax bracket as 15% and our effective tax bracket as 1%. Craziness! The socialist in me is a little disheartened. Oh well, I'm sure we have years and years of good tax paying years ahead of us!

So I haven't written in almost a month, mostly because nothing has really been happening on the financial front. We maxed out our 2008 Roth contributions the end of last month, so that was exciting. Unfortunately it left us $300 shy of the highest tier of interest in our savings account. It should be corrected this month though, but I can't stand losing even a little interest!

Our spending/saving has been pretty status quo the last couple of months since DH moved. We aren’t saving as much as we had been because we now have second rent and utility payments, but we aren’t really spending more than we make either.
It seems like the last 2-3 months DH and I have spent around $300 in travel expenses. Not great for our budget, but necessary when you live 1300 miles away from one another. So I was thinking that February would be free from travel expenses. But then DH’s “deployment” to Italy was pushed back a month to the 21st of February. So I was going to fly up there to see him during the 3 day weekend. Well despite being a federal holiday, he was going to have to work a significant portion of the weekend, so it really wouldn’t have worked out. I was pretty bummed that I wasn’t going to be able to see him before he left for ~3 months.

But then the Navy provided! He was able to get on a flight down to Jax on Valentine’s Day! He was only in town 16 hours but it was good to see him!! And, not only did we not have to pay for flights, DH will actually get paid some for coming down here. Last month when he was here for the weekend we got an extra $220. Since it was only 1 night it will probably only be like an extra $50, but hey, it paid for dinner! I love that the Navy will pay DH to come home to visit me.

Now that DH is leaving the country, I’m curious how that will change things financially. We will still have to pay for his rent, but he’s turning off the other utilities, so we shouldn’t have to pay them. Also he will be getting per diem, which is extra pay you get when not at home to pay for living expenses like hotels and food (this is what DH gets when he visits me). Per diem can be significant, but I don’t know how much it is or when/how we will get paid for it. It may be that we don’t see any of it until he comes back home in May.

Ok, now I have been paying attention and know that the stock market has been falling lately. However, I decided to take the plunge anyway and max out our 2008 Roth IRAs today (well, technically Monday). I'm sort of figuring that sometime in the next 40 years before we retire the stock market will rise. If it doesn't, I think we'll ALL be in a world of hurt.

Now, if you notice on my side bar, as of December I only had about $2,400 saved, so how did I end up with the 10K needed to max it out? Well my in-laws graciously agreed to cover tuition for this term. Independently DH and I decided that we would take the subsidized loans out and pay for the rest of tuition OOP. So I decided to stash that "extra" money in our Roth, knowing that if things went terribly wrong, we could take it out (I don't anticipate this at all).

Also DH and I went grocery shopping last night and saved 13.34 which I will be adding to my challenge.

New addition: $13.34
Previous total: $418.92
Total: $432.26

Recieved $47 from Survey Spot and $40 for tutoring last month which will be added to the challenge.

And in other news the simulators up in Maine are closed so DH is coming to Florida to work...and see me!! He has to work part of Friday and most of the day Saturday, but we have tonight and Sunday to play. Also, since he isn't at home he'll get paid per diem, so we'll also get about $200 for the weekend.

New addition: $87.00
Previous total: $331.92
Total: $418.92

Went grocery shopping today and the store was having some good buy 1 get 1 free sales on some of the items I wanted. I ended up saving $12.41 with my store card, which I'll add to the challenge.

New addition: $12.41
Previous total: $319.51
Total: $331.92

I got some clothes for Christmas that didn't fit so I needed to return them. I went to return them and found that the mall was having some really great sales! I have been needing some nicer clothes, particularly collared shirts. Well JCPenney was having a 40% off the clearance price sale. I went a little crazy and bought 11 shirts for $120 dollars. However, I saved $244.51 since all but one of the shirts were on clearance...and that shirt was on sale.

Then I went to Old Navy they were also having a good clearance sale with half off. Since I had about $20 in store credit after the return I scoured the clearance racks, but didn't find anything I really liked. So I bought a pair of shorts that ended up costing me only $1.25 oop.

So I'm going to add that $244.51 to the savings part of the my challenge. Oh, and I got a check from pinecone, so I'll add that too.

New addition: $249.51
Previous total: $70
Total: $319.51

Well today I finally got mail from when I was gone visiting DH. I am completely floored with how generous my grandparents were this holiday season! I am so thankful and it will definately be put to good use because our expenses are so much higher now.

In addition to leftover holiday wishes, I also got a check for tutoring and 2 pinecone checks. That will start my 2008 challenge off with $70.

New Additions: $70
Total: $70

So I was really bored today and MTV was having a "The Hills" marathon. For those of you who have never heard of the show, it's a reality show who follows Lauren, a girl who works for Teen Vogue in LA and her friends.

For the first couple of episodes I saw today they were having a pop-up-video of sorts where they selected certain items the the girls were wearing to show how much they cost. Several of the shirts and shorts were $300, headbands and bracelets were up in the $100s. The least expensive thing I saw was a pair of sunglasses for $11. Then at the end of the show they would total up the price of everything shown. One of the shows the total was $69K (they did show a $60K car), and for the other two they were about $8,000 and $9,000.

Many teenagers watch this show, what sort of ideas are they getting that to be cool and trendy like the people on the show they need to spend $300 on a shirt?!?! To the shows credit there was about once or twice per episode they had an advertisement saying "get this same look for cheaper at ______(insert Target, Kohls, etc)" But still, way too much money!!

Needless to say, I am NOT living the Hills lifestyle, nor will I probably ever be!

DH and I finally got around to calling the insurance company and telling them our new addresses. We got our new automobile rate quotes and with DH living in Maine, we saved $3!

I also learned that our renters insurance is a global plan so that it covers us wherever we happen to be living. I was sort of hoping there'd be an additional savings there, but hey, at least they didn't decide to raise it since it now will cover 2 households!

Other than that I'm trying to enjoy the last few days up here in Maine with DH and snow. Although I hear Florida is going through its own cold snap!

To join the bandwagon I’m going to look back over the past year to see where DH and I have come and try and look forward to where we want to go.

This year DH and I both opened Roth IRA accounts and were able to put the max out the 2007 contributions. We also currently have over $2400 saved for the 2008 contributions.

In January we had nearly $20,700 in car loan debt. Today we completely paid off my car and only have 6100 left on DH’s car. We could have paid off more, but we decided that it is not financially beneficial to pay off his car early as the interest rate is only 3.59%.

Our savings account has nearly $20K more in it than it did last January. At first I thought this was awesome, but then I realized that it’s been artificially inflated. At the beginning of the year we had several savings accounts. In May, we decided to combine them all into the account earning the most interest. So that was nearly 8K of it, and we received 10K of life insurance, and are holding nearly 7K from student loans. So adding all of those together, we’ve actually lost money in savings! Most of the money came from our down payment fund, which won’t be needed for several years. Regardless, the money was put to good use: retirement, paying off debt, and keeping us fed and sheltered.

We only started tracking purchases in August of 2006, so I can’t easily compare 2006’s spending to 2007, but I’m looking forward to seeing how our spending will change from ’07 to ’08.

Looking ahead to 2008 I don’t know what to expect! We are starting out the year with 2 households and if things continue at their present rate we will only be making about $50 more than our expenses. So that will drastically change the progress we are able to make. We also will have to deal with deployment…well, not technically deployment as it will only be for 3 months. In theory DH will be making more money during this time, and as he won’t be at home, his expenses will go down. So that might be a time for us to play catch-up. In December though, he will be deploying for real, and that will have major tax and income implications. Which I’m sure I’ll be learning more about as we get closer to that date.

Our priorities for 2008 are as follows:
1. Max out our 2008 Roth contributions, it goes up to 10,000 for both of us, so we have our work cut out for us.
2. Save for a down payment. We’ll only start putting away for this after we’ve got our Roth maxed as we are still several years away from actually buying a house.
3. Minimize the amount of school loans I have to take out and/or pay off the loans I’ve already taken out.
4. Pay off DH’s car. As I mentioned before this is not really a priority as the rate is so low.

Well there you have it! I’m really impressed with what we have done so far, a little worried about the near future, but really excited to see where we’ll go from here!!

Wow, I don't think DH and I have been here before! Before anyone gets too worried about us, in the back of our minds we knew this was a possibility and we have prepared for it. Despite the fact that we have the money to cover the bill, it's still a scary and uncomfortable place for me to be.

To bring everyone up to speed, DH moved last month for his job (The Navy) whereas I stayed to finish pharmacy school (and no, Grandma, that doesn't mean we are splitting up or going to get a divorce!)

So November we had increased expenses because of the move and rent deposits and the like. However we also got some money from the Navy for the move. So at the end of the month I did my normal draining of the checking account down to our cushion and transferred it all to savings. With the additional money for moving, it was quite a bit, so I thought we would be fine dealing with 2 households.

Now looking a little deeper into our finances, MS Money says we only made $48 dollars last month…including the moving money! I didn't quite realize that everything DH paid for after he moved wouldn't be on the credit card until December! So this month we have moving expenses, plus his utilities, plus Christmas, plus we've been eating out a lot, plus all our normal charges. Needless to say it has added up to a lot.

Thankfully it was the plan that for November and December, that any profit that was made would go into our EF in anticipation that we might spend more than we make while getting the apartments set up. I’m glad we have the money available, I’m just sad, ‘cause it quite literally means we are spending the money that would have been earmarked for retirement. Oh well, we are 25, have already maxed out our 2007 Roth contributions, and already have some money set aside for our 2008 contributions. So despite this set back we are doing well, and will continue to do even better!

It's been forever since I've added anything to my $20 challenge, but since I want to get back in the habit for 2008 I figured it wouldn't hurt to start now!

Using my card at the grocery store I saved $4.12.

New additions: $4.12
Previous total: $1074.76
Total, since 4/15: $1078.88

I can’t believe how long it’s been since I last made an entry. School has been keeping me busy and I haven’t been as diligent about tracking the $20 challenge like I had been. I think in the New Year I’ll start it up again. It’s always fun to see how much I’ve made and how much I’ve saved.

DH has moved up to Maine and his just stuff just arrived today. He was a little overwhelmed with the amount of stuff that he had, particularly since he’s been living without all of it for over a week. With no TV, no internet, no furniture, no nothing, he went a little spend happy. Although he was pretty good and got mostly things he needed. And he rented movies from the grocery store which only cost $1. Much better than the $3ish they charge at Blockbuster! To be fair I also spent about $30 today on household stuff too. Despite this, we still had had a profit last month! Some of the expenses will spill over into December, but I don’t think we’ll have a problem then either.

Financially, we have made some changes in the past month or so:

*We decided not to pay off our car early the interest rate is so low that it isn’t worth it.

*In January we are going to put all money earmarked for our Roth into our Roth accounts. I don’t think we’ll be able to max it, but we should have about half of it. So we’ll keep saving for both 2008 and then maybe the 2009 years.

*We decided to refuse my unsubsidized loan for next term of school. I still have some money from last semester so we were only going to take out the subsidized loan and pay the difference in the cost of tuition. Well last weekend I got a call from the in-laws and they have offered to pay for next semester’s tuition! So that is great. I think we may still take out the subsidized loan as it will basically be a 3 year interest-free loan. We’ll throw it into a CD or something to make some money!

Well I haven't written in forever. Mostly because pharmacy school had been taking up waaaay too much time, but also because DH and I have been spending money left and right.

We are actually doing ok in terms of actual money available since we both made some extra money this month, but we've spent much more than our normal alotted amount in several categories. Like 2x the amount of gas and 1.5x dining out budget.

We did make a financially responsible decision though. Instead of me flying to Maine and then both of us flying to Oregon, we decided that we were going to just spend Christmas in Maine. My mom might fly out for, but otherwise it will just be the two of us.

Since DH has to put his first and last month for his new apartment, we decided that we are not going to put our extra money toward the car. That shouldn't really affect us, the rate is super low and we don't actually have that much owed on it.

As you may recall DH is moving to Maine next month while I'll be staying in Florida. We'll end up living apart for about a year and a half.

We are currently living in a 2 bedroom apartment that we got for a steal of $800.
In order to save money I'm going to stay in the same complex, but move to a 1 bedroom apartment. So my rent will be about $640. DH just found an apartment in Maine that sounds nice and is in a great spot. The rent is $740/month. So all together our rent will increase from $800 to $1380.

Thankfully almost everything is covered in his rent...even heating since Maine winters can be rough. The only real bills I anticipate him having will be electricity and TV.

I'm starting to freak out a little bit because concrete numbers about how much this year apart will cost us are starting to trickle in. That increase in rent of almost $700 is going to eat up most, if not all, of the money that we had been saving or using to pay off debts.

Thankfully, we know this is coming and can plan ahead some for it. Instead of putting extra towards our car this month, we are going to add to our emergency fund. Moving always results in increased expenses (deposits and purchasing new items), and I'd like to have a little bit more of a cushion available if needed.

September wasn't that great of a month in terms of our budget..we had some areas that we overspent a lot, but we did pay off my car, so that made me happy.

The first area we overspent was in travel. DH had to buy plane tickets to move up to Maine after Thanksgiving. Normally we wouldn't have to pay for this, but the Navy kind of gave us a raw deal on how they wrote the orders. They were trying to save money, but it cost us money!

Next was clothing. DH and I rarely buy clothing, but in September we both had things we needed to buy so we spent $130 vs our budgeted $50. For the month of October, I've already spent our clothing budget and I have a feeling that we me needing to continuing to need "professional" attire and DH needing clothing to handle the winter in Maine, this will be an area we will continue to spend in.

We spent a lot more in eating out than normal, this month, but we didn't go over budget. I like to plan most of my budget with cushion, particularly eating out and groceries. So spending up to the budgeted amount is uncommon, but hey--that's why we've allotted money to that area!