Financial Makeover: The Art of Being Frugal (and Smart)

Image: Jess Baker

This past week (and most of last week), I have spent pouring over my loans, my debt, my savings, and my life plan. Oh yes. Being an adult is AMAZING. No. No it isn’t.

Anyways, I have decided to make a plan for the next coming months that is sure to pay off in the end. At least I am hoping how that turns out. I am going to be putting our Fire Department checks (we get paid for the calls we go on in one lump sum in December, perfect for Christmas time!) toward our mortgage. Say we make $3k collectively, though I do hope we make more. I will put half towards our principle and half into our bank that carries the mortgage to help pay for our taxes. I store money like a freakin’ squirrel so I will be taking some money out of our joint savings that we  have built up (Helloooooo automatic transfers! They work WONDERS!) and will be putting it in the savings account “Oh shit, we need mortgage money” savings to top off our 6 months of just-in-case money. Hubby likes the idea of having an even 10k in there so I will oblige. I have a little bit accumulated on my credit card and will be paying off that in its entirety from our joint savings so that I can just pay ourselves back (and not the 16% interest the bank would charge!). I will be getting in touch with our finance person here at my company to discuss my 401k AND lastly I have devised a plan to pay off my student loans quick. I usually transfer $85 twice a week to one savings, and $50 each to two other savings. Now that I have reached my savings goal, I am going to break it down to $100 once a week to savings, continue with the two $50 transfers and take the extra $70 and put it towards the principle of my highest loan. After that is paid off, I will use that money plus the money I used to pay for that loan and begin to pay the next highest one off. And so on and so forth. With this I can at least take 4 years off my loans.

So being a big girl hurts the wallet a bit. But it is ok because if anything is to happen, I will be prepared. Also, I can sleep better at night knowing that instead of buying a bunch of shit, I will be able to eat and not lose my house if Hubby and I were both unable to bring any income in. Eh, it’s cool though.

With all this, I got on a kick of reading other blogs and seeing how other bloogers have done it. I found some really great ideas, a lot reiterating what I just said about my loans. Smart and frugal people! However, there was a great deal of advice that was both genius and WTF (example: making a food item you can buy at the store for $2 and using $15 in ingredients to make it yourself which will probably end up coming out tasting like crap anyways). One website recommended other blogs with their article The Best of Frugal Living. At the top of the page is an image that reads: “Use it up, wear it out, make it do, or do without”.

This-this is real genius poetry. USE IT UP. If you didn’t have an excuse to use up all that good soap you’ve received as gifts over the years, what are you waiting for? The Queen to come over? I have put a dent on my soap collection but I literally have not bought soap in well over a year. Use that foot scrub! Use that lotion! It will probably get all goopy before you get a “special” time to use it anyways.

WEAR IT OUT. Why fix it if it ain’t broke? Honestly, we have to replace both our dishwasher and our oven because they are on their way out. However, they aren’t there yet. They aren’t broken and they are stylish enough so even though I have the money saved for these purchases, we aren’t going to get rid of them until it is actually necessary. I am going to run those babies into the ground!

MAKE IT DO. I’m not entirely sure if this is meant as “Make Do” like make do with what you have or “Make it Do” like make it do something it wasn’t meant for (up-cycling??). Either way, re-purposing items is awesome (just watched a video on how to make a camping stove out of a beer can) or again not buying something new until it is necessary and will save you some dough.

DO WITHOUT. Almost every blog you’re going to read is going to squawk at you to not buy coffee daily and to brown-bag it during the week. It is true though, you’ll save well over $50 by doing this, translating to $200 a month or $2400 a year (WOAH). But you could probably cut back on other unnecessary expenses that won’t make you go crazy. Start doing things you can do yourself without having to hire a service, or if you’re not into the whole Suzie-Homemaker thing, do your nails yourself once in a while. It’s pretty easy to do without.

I get lunch, I get coffee, and though I don’t get my nails done, I do buy polish. However, I do it all in moderation. I am going to try really hard to keep track of the money I save over this next year to really see the mind-blowing results. In 3 years Hubby and I went from having $3,000 to our name jointly to having over $30k AND paying off 2 vehicles and being credit card debt free. All while working normal jobs and living normal lives (yes, we don’t recycle toilet paper or paper towels-though they do seem to wash well as Hubby always forgets to take them out of his pockets).

My Experiment: Pay for School, Pay it Forward

Ok, so I have been going through my student loans and have realized I owe a mere $49,201.00. Yes, I am being both serious and sarcastic. Apparently, according to my FB friends, they owe anywhere between 20k and 122k… Of course it make a huge difference if Mommy and Daddy paid for most of school or if you went out of state and paid for it yourself but am in between that with paying it entirely on my own and (thank God!) going in state. I have been paying these damn things down for what seems like forever now (in reality I am rounding on my 4th year) and I figured I’d take a look-see and see how much I still owe and for how much longer I will be paying the same amount a month as I would for a brand new Caddy. It’s totally cool though because seeing as I have multiple loans in “groups” I will only be paying for a brand new Cadillac for the next 6 years… after that I will be paying for something more like a brand new VW Jetta for the next 5 after that. I am in a position where I can put more money towards my loans and will be paying them off sooner rather than later but it still is daunting and feels like it will be forever before I am going to get anywhere. Then I had a brilliant idea.

My Experiment

I’m not entirely sure you could call this an experiment other than my curiosity as to whether or not it will work. However, I owe 49k… and if I can raise that money in form of donation NOW I will in turn pay that money forward in the form of scholarships for women who are pursuing degrees in science. Basically, it is to pay for my school and bypass the interest all while helping others out. I thought it was a pretty cool idea. Here’s my initial starting model:

My Group C loans: Principle balance is $4325.25 with an interest rate of 5.889%. That makes my monthly payment $80.81. I still owe 132 month on the loan. That equals out to paying $10,666.92 over the rest of the life of the loan. That is $6341.67 more than what is left of the loan. THAT is CRAZY.

So here’s my deal. I raise the money NOW for the principle and pay it off and over the next 10 years will be donating that money (funded by myself) to a woman pursuing a degree in sciences, math, or engineering. That is 10 scholarships of a little over $400 for just this loan. If I could raise the entire amount now, I pledge to give that money back in scholarships over the next 10 years. That is almost $5,000 a year in scholarship money to women who deserve it!

Of course people don’t know me from Adam and may think I’m a fraud and I don’t really know how to convince them otherwise because we all know how many weirdos there are on the internet. However, I will be making a website to chronicle the scholarship, funds raised, and recipients and hopefully that helps.

 

If you’d like to help out and donate, here is the link. Or you can contact me directly if you’d like more information or to donate directly. If I raise only $20, I will pay $20 to my student loan principle and give $20 in scholarship money this year. If I raise $2,000, I will put that directly to my principle and pay 10 $200.00 scholarships. If I can pay off my loans of $49,000.00, I will pay out 10 $4,9000 in scholarships (or perhaps 49 $1000.00 scholarships, depending on the need).

I’m not asking for money (directly) but if you’d like to contribute, follow this link:

http://www.gofundme.com/58d78g

(And tell your friends!)

If you have any ideas, expertise, etc. on scholarship funds, also, let me know.

 

Man, do I feel tiny and insignificant…

Nebulae are “clouds of gas or dust in space that can sometimes be seen at night”. Aka super gorgeous clouds of prettiness in the sky for us as teeny human beings to enjoy. While I am slightly obsessed with the northern lights (though I have never actually seen them with my naked eye), I am now even more excited over nebulae. You can see the Orion Nebula at night, so I am told. First of all, I am going to see if I can see any from my location tonight. Second, check out this photo of Witch Nebula from NASA on Discovery News:

How eerie is that? They also have some gorgeous pictures of other nebula you just have to see… These things are HUGE-blow your mind huge-and OLD! Makes me feel so tiny and my time here on earth so excruciatingly short… Puts things into perspective for you!

Thankful for November

November is a great time to remind yourself what you are thankful for. I find myself sending up silent prayers of thanks daily for all that I have-which in my eyes is a lot. Even when I am cleaning the house, I find that I am thankful for simple things like “Man, I love the smell of that candle-I am thankful for that” to bigger things like “I am thankful that I even have a house to clean!” Lots of people go to Facebook to update their status with “Today I am thankful for…”. I honestly think this is a good little tradition for the month and I am thankful for the month of November-a time people can set aside to reflect on things that they are thankful for.

Today, I am thankful for my health. I am thankful that I have strong legs to carry me, healthy lungs to breath in good air, and working hands to do what I need them to do. I’ve always been the pinnacle of health growing up-something I had always been so proud of. As it turns out, I’m actually not invincible like I thought (see here). In fact, I’m totally imperfect. But it is fine because overall I am healthy and I am so very thankful for that.

What are you thankful for?