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Recently I saw a deal for a reduced annual subscription to one of my favorite magazines, ShopSmart, which is issued by Consumer Reports. I always find some great tips in that magazine and truly enjoy reading it. I was tempted to purchase the subscription when I stopped myself – I can read this magazine for free at the library; I don’t need to spend $15 on a subscription to something that will be quickly thrown into the recycle bin when I’m finished. It’s just going to create more clutter and waste not to mention cost me money.

I think this is how people get themselves in trouble financially as little purchases over time do add up, particularly subscriptions which tend to stick around far past their usefulness because it’s so easy to allow the company to keep deducting that amount from your account. This is why as tempting as it is I’ve been able to stop myself from buying a premium subscription to the streaming music services I like to listen to at work – Digitally Imported and Pandora. Sure, the semi-frequent commercial interruptions can get a little annoying, but is it really so bad I need to add an unnecessary expense to my budget? I don’t think so.

I think it’s worth it to evaluate what you’re spending your money on monthly that isn’t a necessity. This is particularly true if you’re struggling to make ends meet, but even if you’re comfortable. There’s no use in throwing money away that could be better saved.

Budgets

I can’t stress enough the importance of doing a monthly budget, regardless of your income, and also computing your net worth month over month. How else do you know if you’re on track for long term goals or just want to make sure you’re not spending more than you’re bringing in?

We budget everything each month, and I do mean everything. With things are as tight as they are today, we need to stay on track and make sure we’re not increasing our debt. Every dollar counts!

Budgets can be pretty simple or really detailed. The good thing is it’s easy to start out and add more detail month to month if you want. If you have Excel, a little work up front will help make putting a budget together pretty easy.

In its simplest form a budget is a forecast. You calculate your income and subtract all expenses. Bingo, you’re done. Hopefully there’s a positive number at the end. If it’s negative, you’re spending more than you’re bringing in and your debt will grow. If you want to stay out or get out of debt, then changes need to be made.

Budget example:

Total Income = $1000

Expenses

    Rent $500
    Electric $75
    Cable $82
    Gas $65

Total Expenses = $722

Balance = $278

Not sure where you stand each month with your expenses? An easy way to figure it out is to use a credit card for the month to capture all expenses. Of course, as long as you can pay it off right away. No need to unnecessarily carry a balance and get hit with finance charges.

A budget helps with planning for one-time expenses too. A family vacation on the horizon? Maybe driving school for a new driver? Plugging that into your budget will help ensure you can cover these one-time expenses.

Net Worth

You may be asking yourself, why should I be interested in my net worth? Well, a couple of good reasons. Maybe you’ll be looking to get a loan for a car or a mortgage or have long term goals to retire someday and not work as much or at all. Tracking your net worth will tell you how well you’re doing. It’s an eye opening experience tracking your net worth month over month. Sometimes it’s not pretty, but it’s good to know where you stand.

Where a budget is somewhat of a forecast, net worth is actual. In short, it’s your assets minus your debts.

Net Worth example:

Assets

    Home $150,000
    Retirement $12,500
    Savings $3,000
    Checking $1,250

Total Assets = $166,750

Debts

    Mortgage $12,2000
    Credit Cards $2,200
    School Loan $23,000
    Auto Loan $9,800

Total Debts = $157,000

Net Worth (Assets – Debts) = $9,750

Even if your net worth isn’t a positive number. Don’t stress. You’re taking the first step in fixing it just by tracking your net worth. Now you can put a plan in action to turn it around!

In Conclusion

I challenge you to do a budget if you’re not doing one already, plan one out just a month or two. Track your expenses, this is huge. I have friends who did this and were amazed to find out how much they spend eating out. They weren’t tracking it before and now realize how quickly it adds up.

At the end of the month, update your budget with actual ending numbers so you can see if your budget was in line. Then do a net worth calculation. Month after month you’ll see you become somewhat addicted in finding out if you’ve made progress. And you can measure any changes you’ve made to see the impact.

We’re not financial experts, just sharing some things that have helped us out. But we’re willing to help. If you have questions, feel free to shoot us an email via the CONTACT US link and we’re more than happy to give our $.02 :)

We’ve all heard of the Latte Effect as it relates to personal finance, right? You know, cut out the cost of your daily high priced drink and save $5. Do that for a month and viola, $100 or so. Not sure I’d cut them out entirely. I mean, you’re entitled to a vice every now and then eh? And I love a vanilla latte every now and then.

No Pop

But the same pertains to regular pop and calories too. I love pop, especially Pepsi. If you’re a daily drinker the amount of sugar (calories) can add up quickly. Let’s do some math.

150 Calories in a can
365 Days a year
54,750 Calories in a year

54,750! That equals 15.6 lbs. Just by doing nothing more than cutting one can of pop a day out of your intake could save you nearly 16 lbs a year. Besides all that extra weight, you’re saving some money too with not purchasing the pop, or as much of it at least. Maybe that’s a little exaggerated with assuming a can a day. But maybe not. I can think of several people who I know are drinking a can or more a day or pop, every day.

Which takes us to weight control. Am I some expert in nutrition and weight loss? Nope. But I have years of experience learning how my body reacts to food and exercise. We should all be working to keep weight in check. We all need to control our weight and be careful what fuel we’re putting inside. Want to know what I think is the secret to weight loss? There is no secret. Seriously, no magic pill, no special exercise, no juice fast (although it may be healthy once in a while). Weight loss is as simple as if you burn more calories in a day than your daily allowance, you’ll drop weight over time. That’s it. Have an allowance of 2000 calories per day, eat 1500 and you save 500 for that day. Add up all the saved calories and once they reach 3500, you just lost a pound. It’s just math, and simple math. I didn’t even have to take my socks off for that one.

The hard part is the will power. That’s tough, so much so I’m not even going to get into it. :)

As I get older, I’ve come to understand how important health is. Both for my longevity and even for my pocketbook. Here’s a stat that most don’t include when retirement planning. The ERBI estimates that it will cost the average 65 year old couple over $150k to cover just HALF the medical expenses incurred in retirement. My thought is, the healthier I am the less chance I’ll need that much medical help. Of course, there are some things that may just happen. But if I can help influence that number, I’m going to!

BTW – Here are two great apps to use for tracking your exercise and food intake if you’re interested in taking it to that level. Both are available on iPhone, Android, and Window devices.

My Fitness Pal
Runtastic

Alternate title: How I got a $79 purse for free

I’ve been drooling over this particular purse (the Kipling Callie Crossbody in Pearlized Grey) since I spotted it at Macy’s weeks ago when we were shopping for towels for our master bathroom. I love Kipling’s products and own an awesome backpack I use all the time when we go on vacations or nearby excursions. They are made very well, but they are pricey.

Kipling Callie Pearlized Grey

Usually I’m pretty good about forgetting about the stuff I see that I “want” because I see a lot of stuff I wouldn’t mind having. I almost never buy anything over $20 immediately because more than half the time I completely forget about it in short order, meaning I really didn’t want it that bad. Honestly, friends have commented on my incredible patience waiting to buy something I want. The last point-and-shoot camera I bought was researched heavily and I waited a couple of months for a good price before purchasing it. Sometimes the hunt is half the fun!

Another example of my incredible patience is how badly I want to upgrade my phone. I currently have an iPhone 4S that I bought in October 2011 which means I’m eligible for an upgrade. I’m not sold on the iPhone 5, however, so I’ve been biding my time to see what the iPhone 6 will bring to the table. I definitely want something with a larger screen, so if Apple fails to deliver I might get a Samsung Galaxy phone instead. But I don’t want to jump the gun even though my current phone is starting to drive me crazy with it’s increasingly poor battery life and how much slower it’s gotten with each iOS update. That means waiting until October before being rid of my current phone but it will be worth it because I will be getting something I know I will love and use for years.

Getting back to the purse…

When I first spotted it I was willing to break my don’t buy it immediately rule because it appeared to be on sale (20% off the $79 tag price), but when I asked an associate they said it was ringing up full price. Back to the display it went. I didn’t care to drop that kind of money on a purse when I was making more money than I do now so there was no way I was going to buy it for $79 plus tax.

When I got home I started researching it online to see if I could find it elsewhere cheaper, but Macy’s was the only game in town so I figured it must be exclusive to them (it wasn’t even on the manufacturer’s website in that particular color). I tried to put it out of my mind but I kept thinking about it (a sure sign that I really wanted it).

Fast forward to this past weekend. I was browsing Groupon‘s coupons (say that 3 times quickly) and found a Macy’s 25% off coupon. After discussing it with my husband, I decided to apply for a Macy’s credit card to get an additional 20% off so the purse would only be $51.19 (including tax). Now, I don’t recommend this approach and have pretty much never opened a store card just to get a discount. However, we have excellent credit and no large planned purchases on the horizon so it wouldn’t be a big deal for us.

We were on our way to Macy’s when something told me to check Amazon again and wouldn’t you know it, suddenly they had it (I confirmed on CamelCamelCamel.com that it was a new item which is why I hadn’t found it before). Not only that but it was only $50.82! Obviously, I was all over that!

I almost opened an Amazon Rewards card (via Chase) as they were offering me a $50 instant discount, but the application was confusing as it asks for your annual income and it didn’t seem like I could add our total household income since the card would be in my name and they only wanted my employer’s name and phone number. So I logged in as my husband and was going to apply as him but they were only offering him a $30 credit, probably because we purchase more from Amazon on my account. Then I started reading the comments about how Chase rarely approves people instantly and sometimes they have to wait weeks to get the credit. At that point I was completely turned off to applying for a card and decided to forgot that route.

I logged back into my account and realized I could use my Discover card cashback bonus to pay, and since it was over $100, I ended up doing that and not having to pay one cent out of pocket. I opted for free super-saver shipping but the delivery period was when we plan to be out of town so I ended up signing up for an Amazon Prime trial so I could get the 2-day free shipping. The purse was out of stock, however, so the two-day shipping is based on when it will be back in stock. However, that will still get me the purse before we leave on vacation so there isn’t a package sitting outside my house for days.

So I gave into the want this time but I came out no poorer. I guess that only works, however, if you keep it to a minimum. Obviously my cashback bonus can only grow if I’m not constantly spending it. But I hope my story above demonstrates that you can still get things you want and stay frugal as long as you’re willing to be patient and keep your wants to a minimum.

Incidentally, I’m trying to see whether the Amazon Prime membership is worth the $99 annual fee. We don’t order from Amazon too often, so I worry that having the membership will just encourage us to spend more. However, I like that they have a lot of streaming video content, allow you to borrow one free Kindle book per month, and just started offering free streaming music with the membership. If anyone has an opinion on Prime, I’d love to hear it.

Sometimes trying to save money ends up backfiring. Let this tale be a lesson to all so you can learn from my mistakes!

I’ve been wanting to replace everything (rugs, towels, shower curtain) in our master bathroom for years now, but it was more a want than a need. It recently became a need, however, when I noticed the rubber backing on the rugs started coming apart. We had been using the rugs for over ten years so I felt like we had gotten excellent use from them. Now it was time to find something different. Our current color scheme had been mismatched for awhile – blue rugs and bath mat, white curtain with matching blue, as well as pink and purple, flowers, and faded purple-ish towels. It wasn’t sophisticated, but it worked.

At Target I spotted some eye-catching bright green (guacamole, according to the tag) towels and matching rugs. They also had a cute shower curtain that matched perfectly. We ended up buying everything one weekend and took advantage of a coupon where you received a $5 discount. After washing the towels I immediately regretted buying them. They were cheap ($5 for each bath towel and $4 for each hand towel) and it showed. Not only was there far too much dryer lint to come from such thin towels, they were fraying after the very first wash! Not only that, but they shed all over the place. A week later when I was cleaning the bathroom I swept up a thin layer of towel pieces. Ridiculous!

As for the rugs, when I finally got around to switching them, I was disappointed in how thin they were compared to the current rugs. There was no cushion to them, so we decided to return them and keep looking.

Unfortunately we had an extremely difficult time finding suitable rugs. We looked at many stores – Macy’s, Carson’s, Sears, Kohl’s, Meijer, Walmart, IKEA, and even Bed Bath & Beyond. While each store had many towel colors to choose from, their selection of rugs was paltry. Sears really had nothing at all and I’m pretty sure that’s where we got our original blue rugs that we loved so much.

We ended up going back to Target and re-purchasing the rugs. For the one in front of the sink I put a memory foam rug, purchased from Kohl’s on sale, underneath for cushioning. It’s not the greatest solution, because it’s smaller than the rug, plus because our bathroom is so small, I have to flip the rug over in order to close the door, but whatever.

This, my friends, is what happens when you try to spend the least amount of money on things. I have no doubt that these towels aren’t long for the wear, nor are the rugs. Had I just conceded to spend a little more upfront, perhaps I would have chosen a different color scheme that had better quality towels and matching rugs to begin with. On top of that, I had forgotten that I could have gotten a free gift card through my Discover card cash back for Kohl’s or Bed Bath and Beyond and not spent anything out of pocket! Lesson learned!

Oh, and on top of that we never found a matching bath mat so we’re still using the blue one that doesn’t match anything. We’ll probably have to get a white one.
In the future I’m considering getting white towels instead of any colored ones because I noticed that there’s a lot of products containing chemicals that damage the color anyway. That’s why our purple towels were nearly pink and had weird orange streaking in them, and one of the new green hand towels already has yellow streak marks on it. So frustrating!

Where do you buy your bathroom decor?