Friday, January 30, 2009

Never Be Ashamed Of An Honest Day's Work

Saving Money Tip #60 - Never Be Ashamed Of An Honest Day's Work - In tough economic times such as these, people are being laid off from jobs they have worked at for years. Many are losing work in the only field they know. In some cases, both halves of a couple are being let go. And there are others who have just graduated college or finished a technical program looking for their dream job. And for these people who need to find a job to pay the rent or put food on the table, I say, "If you can't find a job in your field, then find a job that will pay you. If the job is legal and it needs to get done, and someone will pay you to do it, then take it. You should never be ashamed of an honest day's work."

I don't know where I first heard that saying. It may have been in a book I read. But it always stuck with me. If you are doing a job that is not illegal and not immoral, then there is no reason to be embarrassed about doing it. An honest job is a job. If it will help support yourself or your family, then not only is it something to not be ashamed of, but rather something to be proud of. This is true whether the job is cleaning up after the elderly in an old-age home or picking up trash in your city. These are jobs that need to get done to provide comfort for people and to keep our communities going. They are honest jobs. They may not be glamorous jobs. And they may not be clean jobs. And they may not be anyone's dream job. But they are honest jobs. And doing honest work is nothing to be ashamed of.

Shame comes to someone who thinks he or she is too good for a particular job and doesn't take it at the expense of himself or his family. No one is too good for an honest job. We are all people - skilled or unskilled - and none of us is too good for any type of work.

If you are one of those people who hasn't been offered a job paying you as much as you were making before or you haven't been offered a job in your particular field or with the benefits that you are used to, then I encourage you to take a job that has been offered you. Even if it's flipping burgers in a fast-food joint. It's honest. It pays money. And you won't be doing it for the rest of your life. And even if you are, if it puts food on the table for your family, who cares?

In Real Life (IRL) - I haven't worked in about a year and a half since my youngest child was born. And before that I was working part-time at an office where I used to work full-time. When I was there full-time, I had a pretty good position. I had been there longer than some others so I had a little bit of seniority. But when I went to part-time, my seniority went out the window. But I wasn't embarrassed. Sure I was taking instruction from people younger than I and who started after I did. Sure I used to have an office with a window by myself and now I was sharing a windowless office with someone else. But it didn't matter. I was doing the job that was offered to me on a part-time basis. And I needed a part-time job. They paid me and I was happy to be helping out my family in some way. It was nothing to be ashamed about.

Now I am in a position where I am looking for different work - work at night or on the weekend so I can stay home with my youngest for another year. And the jobs I am looking at pay about 1/2 or 1/3 of what I was making at the office. but I'm not too good for those jobs. So what if they are entry level and I've been in the working world for 15+ years? So what if most of the others I will be working with haven't graduated from college and I have my master's degree? I am no better than they are - perhaps more educated and maybe more experienced - but that's it. We're all out there trying to do the best we can with what is available to us. And that is what is available to me at this time. My working at this type of job will help my family's financial security. And that is nothing to be ashamed of.

Wednesday, January 28, 2009

To Clip Or Not To Clip, That Is The Question

Tip #59 - Is It Worth It To Clip Coupons? Coupon clipping seems to be all the rage lately. Frugal blog after frugal blog showcase coupon deals that can be had out there. Items are laid out in pictures to show what deals the blogger has captured. "Ten boxes of granola bars for $1.60!" "Three bottles of apple juice for 90 cents!" "Six containers of yogurt for free!" There are faithful followers to these blogs who don't want to miss out on a deal.

The question I have pondered over and over while reading these blogs is whether all of this coupon clipping is worth it. My conclusion? A resounding "somewhat." I think it is great that moms are watching how much they are spending at the supermarket. I also think it is worthwhile to cut coupons to get a better deal on something you would have bought anyway. And I am glad that there is a huge interest in saving money. However (you knew this was coming, didn't you?), I think many overzealous followers of coupon deals are short-sighted when it comes to how much couponing will help them become financially secure. Yes, clipping coupons may cut down on the food and toiletries budget. It may "save" them $200 per month. But unless this coupon clipping phenomenon is combined with time-tested ways to save money, there will still be a lot of people out there who are still in debt, who haven't saved for retirement, who haven't saved for a rainy day. And the only thing they have to show for their coupon clipping hobby is 25 boxes of AquaFresh toothpaste.

If clipping coupons is truly saving you money at the grocery store, then by all means continue to do it. Saving $200, $100, or even $50 per month on groceries can be a great start to a financially secure future. But that's all it is - a start. You will need to take that savings and faithfully put it away month after month into a savings account. Or if you are in debt, you had better be using your savings from coupons to pay down your debt. And hand in hand with your coupon savings, you should be doing all of the other steps people do to acquire wealth - live within your budget, save for a rainy day, put away money for retirement, and save for other needs you may have in the future - a car, an education, etc.
Also, keep in mind all of the time you are spending researching the deals, looking up coupons, cutting them, etc. It's possible that the time you spend clipping could be put to better use. It's up to you to make the call. Overall, while it may be fun and beneficial to find the good deals, make sure you also have a realistic view of your complete finances. Coupons are only one tool of many that can help you save money. However, it is not the only tool. They alone will not make you financially secure.

IRL - I clip coupons. I have never been very faithful about it. I tend to go through phases of coupon clipping. Lately, I have been on an "up" phase with my coupons - probably from all of those blogs I read about clipping them. I never seem to score the way others do. I generally just use coupons for products that I would have bought anyway or as a substitute for a product I usually buy. I might try a different cereal if it is a really good deal. If my kids or I don't like it, I know my husband will eat it. I don't, however, buy things just to get them for free. I think that is a huge waste of resources. We don't drink diet soda in this house. I would never buy diet soda even if the coupon was for a free one - unless of course we were having company soon who would drink the stuff. For my grocery budget, I tend to buy more in bulk and compare unit costs to keep my grocery expenses down. I try to do cooking and baking from scratch so many coupons don't even work for me. But when they do, I use them.

I do think some people get carried away with coupons and buy whatever they see that is a good deal. And I think for some people, it is the only thing they do to save money. But as I said in the paragraph above, I don't think this will lead them down a path of financial security. I think coupons can be used as a tool for saving money on groceries and that's it. But saving money in real life is much more than that. For me, it is a mindset or a lifestyle that incorporates all aspects of my life. I hope that readers and followers of coupon blogs look beyond the coupons to find additional ways of saving money and living their lives so that they can have financial freedom.

Tuesday, January 27, 2009

Keep Your College Costs Down

Tip #58 - Keep Your College Costs Down. No doubt about it, college is expensive. Very expensive. Many private colleges' annual costs are $40,000 or higher. Seriously, this is an annual income for many people. And while I'm sure the academics are good at most of these private institutions, a college degree can be had for much cheaper than what the private schools want to charge you.

--If the goal of college is to be able to get a good job when you are finished, there are hundreds of public colleges with excellent academic reputations. And they cost half the price of private college. Sometimes even less. Many magazines do an annual report on the best colleges for your money. I found this link at Kiplinger's that lists the best value for public colleges. You can search by the whole country or just your home state where costs are even cheaper. When I did a search by the whole country, I saw many public colleges listed for under $20,000 per year. A lot of money, still. But a whole lot better than private. Search by your state and see which colleges are listed.

--Another thing to consider is how far a school is from your house. If a school is out of state or clear on the other side of your state, you will be paying high travel expenses to get to and from school and on holidays. If you have to factor airfare and gas costs into your college costs, then your expenses will go up. Make sure you look into all costs involved in the schools you choose.

--An even cheaper way to go to college is to find out about the large state universities in your state. Many of them have local campuses so you or your child does not have to pay for room and board. That alone can save up to a third of your expenses. And you still graduate with the name of the university. Or, if the local campus doesn't have "the name" that you want you can always start out there and move up to the main campus after two years. Usually, there are no problems transferring credits since it's part of the same institution, as long as your grades are good.

--Let's go even cheaper. If you haven't saved much for college but you want to go, without forking out a fortune, why not try community college for two years? Then after two years, transfer to your state university. Community college costs are almost always less than even a local university. If you can to there for two years, then your total college expenses will be cut down dramatically. Of course you have to do well and then apply to get in to the University of your choice. But if you are committed to it, it should be no problem. Universities often look for students who have proven themselves at community college.

--Of course there is always financial aid. While I am not a big fan of huge debt, school loans generally have favorable terms. The key here, I believe, is to take out a school loan if you need to, but do it for the lowest priced college with the academics that you want. Taking out a loan for a private university will set you back several years in the savings department while you have to pay it back. And I'm not sure that the private university name will lead to such a good job to make up for the price that you are paying to go there.

--There are also scholarships. I know people who have gotten them. Some were academic, some were athletic, and some were based on financial situation. Scholarships should be looked at as a bonus, since you will often not know about them until late in your college choice decision making.

--Think creatively. Can mom or dad get a job at a university that gives out discounted tuition to family members? If the school is inexpensive to begin with and its one you think your child will go to, then it may be worth it to look for a job there. Of course, this only makes sense if the income, benefits, and job security are the same as a job you are leaving. Or if you weren't working in the past, and this is an extra job. Not all schools offer this benefit, but it may be worth it to find out if one you or your child is interested does offer it.

--Take AP (Advanced Placement) classes in high school if your school offers it. Many colleges accept AP high school credit if you get a certain score on the AP test. By entering college with some credits to your name, you may be able to save on paying for some college credits or even a whole semester!

--Take classes in the summer at community college. Your student may be able to take some college credits at a local community college in the summer that may transfer to the college of your choice. These courses are almost always less expensive than at a regular college. Make sure they will transfer before taking them.

--Get a job. Can you get a job that will pay your tuition costs? This may not be feasible for a student coming out of high school. But it often works for master's degrees. Many businesses will pay for some or all of a higher education degree of their employees if it's in the field you are already working.

In Real Life (IRL) - I've mentioned before that my dad paid for my college education as well as that of my brother's and sister's. But my parents were not going to pay for us to go anywhere. They felt that we could get as good of an education fairly close to home. My parents wanted us to stay within three or four hours from home so there would be no flying expenses. Their argument was that there were many good colleges close by, that there was no need to go far away. And while we did consider some private schools, when we compared them side by side with the public ones in terms of cost and quality of education, the public ones won out. My parents did say they would make an exception if we were Harvard material and nothing else would do, but unfortunately, that wasn't the case.

While none of us went to a local campus first to live at home, it was an option had we chosen Penn State. Living in Pennsylvania, there are many local Penn State campuses throughout the state that one can go to for two years before going up to the main campus. I know many of my high school classmates who did this in order to save money. They lived at home for two years and then went up to Penn State main campus for the last two years. They still had the college experience of living away from home and got to graduate with the Penn State name.

While I don't have any personal experience with community college or student loans, I do have friends who received scholarships for school. (I, unfortunately, did not.) I have one friend who grew up in Maryland. He was very bright and probably could have gone to Ivy League type schools, but he lived with his single mom who probably couldn't afford such a school. He was offered a scholarship for a state school and went to University of Maryland for computer science. He excelled at his studies and was able to get a good job upon graduating. Twenty years later, he still does quite well. And I don't think going to a public university hurt him at all. When he looked for jobs, he proved himself with his skills and experience.

I know another person whose parents offered to pay for school at a public institution (also in Maryland) but told him that if he wanted to go to private school, he had to pay the difference. This guy was also very smart, and he thought a private school name would make a big difference in his job opportunities when he graduated. So he chose a well-known private university. His parents paid for part of his tuition, and he took out loans for the rest. I met him a few years out of college and he said, the private school name that he went to did not help him with his job prospects. He said he would have done just as well at University of Maryland and without loans to pay back. I'm not saying this will be everyone's experience, but this was his experience.

As far as working at a college so your child can go for a discounted rate or for free, I have heard that this benefit has decreased dramatically since I went to school over 20 years ago. My sister worked at a local private college after graduation and there was a secretary who worked there. She said she was never going to leave her job because her son's school tuition was going to be free there. My sister earned her master's degree for free while working there. I also had a friend at college whose dad was a university professor there. Her tuition was free for all four years.

I took AP Calculus in high school and was able to get 4 credits for it in college. Because the program I was in required 125 credits for graduation and my tuition only paid for 15 credits per semester (anything above 15 credits cost extra) for a total of 120 credits throughout the four years, I only needed to pay for 1 extra credit during my four years. I have heard of people who enter college with over 20 AP credits. By doing this, they could graduate a semester early - saving a semester's worth of tuition. Some of my friends took some of the introductory college courses at community college in the summer. The per credit cost there was cheaper than at our university.

My last life experience with college costs was for my master's degree. I worked at a job after college. And they did offer education benefits. It was not the most generous, but it was something. It basically paid for the equivalent of two college courses per year if you went to a local public institution or one course at a private institution. I got my master's degree over a five-year period by taking two courses per year at a public university at night while working at that job during the day. There were a few courses I had to pay for on my own since they weren't directly related to the job I was doing, but the company approved the rest. So my master's degree program cost only a couple thousand dollars total. Much better than if I had gone full-time directly after college and not making an income.

So while college is expensive any way you look at it, there are several ways to keep your costs down. If you start thinking of various ways to pay for college and what would be a good fit for your child and your pocketbook, you may be able to keep your college expenses at a minimum. Anyone else have other ideas on keeping college costs low?

Friday, January 23, 2009

Update, Don't Renovate

Saving Money Tip #57 - Update, Don't Renovate Your Home. With the onslaught of home improvement shows, it's easy catch the renovating bug. You might be tempted by kitchens with granite countertops and stainless steel appliances in newly-laid out floorplans. You might want to knock down walls to open up rooms. You may feel the need to have a bathroom with a separate shower and tub. There is no end to what you can do to renovate your home.

These types of renovations can be very expensive. And while they may add value to your home, you probably won't get back all that you put into it. In addition, some renovations can be an over-improvement for the neighborhood or even for the rest of your house.

To avoid costly renovations, try updating it instead. When trying to decide what to do to update a certain room, look over it carefully. What is the worst feature of the room? Is it the wallpaper? The gold shag rug? Change those. Are there still acceptable parts of the room? Keep what's good. You will still get the effect of a renovation without going top of the line.

IRL - I love home improvement shows. HGTV is my favorite channel. I love to watch what houses people buy and what designers do to make the homes look beautiful. But sometimes I get the feeling that I am the only one in America who does not have granite countertops. Seriously, that is all I see on that show.

I mentioned in an earlier post how we updated our 1950's kitchen. We still have the original nice wood cabinets. This was still a pretty good feature in the room. So we left it. We covered the ripped laminate floor with a black and white laminate tile - just like a 1950's diner. We bought a replica diner kitchen table and chair set. We ripped out the 1980's splash paint border and put a new one with cute diner signs -" hot dogs for 10 cents" and the like. And we bought replica tin signs on the walls such as "Route 66". And whenever I am at thrift stores or yard sales, I keep my eyes open for things that would look good in my 1950's diner kitchen. The total cost of our update was about $1,000. We get compliments on it all of the time. And it stands out from all of our friends' kitchens with the Tuscan beige walls and the stainless steel appliances.

I have a friend who did do a major renovation to their kitchen. Their house is 1960's and not much else has been renovated in their house. After spending $40,000 - yes you read that right - their kitchen makes the rest of their house look shabby. The worst part about it is there was so much potential in their kitchen. For the most part, all they really needed was a new sink and countertop. The wallpaper had to ripped down as well. The cabinets were nice hardwood. All they needed was updated hardware. And the floor had been replaced just a few years earlier. They seriously could have done an update to their kitchen for under $2,000 and a little bit of sweat equity. And the style of the kitchen would have at least matched the rest of their home. Also they could have then used some of the money they saved by updating their dated yellow bathrooms. PS. Those granite countertops will look passe in 15 years anyway. :-)

Wednesday, January 21, 2009

Prepare Before You Go

Tip #56 - Prepare Before You Go. Before you go somewhere, read up on the place you are going to. Try to find the best deal that you can. Find out what sales are going on. See if there are any coupons you can use. The more preparations you do in advance, the more money you will save.

If you are going out to eat, look up the restaurant online and look at the menu. Figure out how will you order. Is it better to get a meal by itself or is there a combination that would be a better deal? Are there separate children's meals or should they share with you? At least have an idea of what they offer so that when you arrive at the restaurant you are not under pressure to order in haste and maybe not get the best value for your money.

If you are going to the supermarket look at the circular to find the best deals that you will be getting. Don't wait to get there to look at the circular. It takes time to study the deals. Standing in the crowded market with possibly a child pulling at your hand is not the time to do it.

If you are going on vacation, look up on the Internet the city or town you are going to. Many times there are discounts for events or places on certain days. Again, it is better to know about these in advance so you can plan your trip around some of these deals. You wouldn't want to wait until you got there to find out about them or it may be too late.

If you are going out locally - to a community pool, a museum, or a sporting event, check online or in the local newspaper to see if there are special deals or discounts. They could be for certain days or certain hours. Sometimes there will be an actual coupon that you can print out or cut out.

Taking just a few minutes before doing any of these activities can potentially save you several dollars each time you go out.

In Real Life (IRL) - I am always looking for deals. If I am planning on going somewhere - whether it be a hotel, a museum, or the supermarket - I go online and check out the company's website first. Sometimes I find deals right on their website. Other times I will Google the place I am going to and look for any coupons that might be available. If I am going to a new restaurant, I like to see what options are available on the menu. I find that if I can see how they price things, I can decide how to order. Sometimes my children can get a really good deal from a kids' meal. Other times I find them to be overpriced and I will have them order a la carte.

Before I go to the supermarket, I always look at either the paper circular or the online one. I try to write up my shopping list based on what we are planning to eat that week in combination with what the best deals are at the market. I find that the times that I run into the market on the way home from an errand, I tend to not buy as smart. This is because I have either not looked at the circular or I do so at the store and am in a rush, so I miss some of the good deals.

When we went to Boston on vacation a few years ago, I looked up their Children's Museum in advance and they had $1 admission on Fridays. Since we planned on going to the museum anyway, we planned our visit there on a Friday and saved several dollars per person. When we had my husband's cousin from Germany in town a few years ago, she wanted to do a tour of Washington, DC. For days before she arrived, I searched around for a good deal on a tour bus. I found out by searching online that there was a 2-for-1 deal in the Entertainment Book. A friend of mine gave me her coupon since I didn't buy the book that year. It saved us about $20. Because I have found deals in the past, I try to make it a habit of looking for coupons or discounts before I go somewhere. I don't always find them. But I would estimate that I do about half the time. It's a good habit to get into to help save some money.

Monday, January 19, 2009

An Interview With My Dad

My dad was an influential person in my life as far as saving money is concerned. He grew up in humble surroundings and made himself a success. He was frugal and spent his money wisely. His example left a huge impression on me.

Since we are visiting my parents this week in Florida, I thought it would be a good idea to interview him and find out how he became successful, why he saved money and how he did it.

Michele: Dad, I have a blog on saving money. Since you taught me much of what I know, I want to interview you for my blog. First off, do you know what a blog is?

Dad: Blog? Is it the first four letters of the name of the Governor of Illinois?

M: Well, not exactly. It's like a journal on the computer.

D: Yeah, it's something on the computer. I think I've heard of it.

M: Growing up, did your family have much money?

D: No, my dad did a little bit of everything. He was a jack of all trades and master of none. He didn't make much money. Then he died of a heart attack before I was 10. It was 1948. My mom took a part-time job at the 5 & 10 as a cashier. So we had nothing. We lived in a small apartment in Brooklyn.

M: What kinds of things did you do in your childhood?

D: Well, I went to school. We never took a vacation. I worked through school to earn money for the movies and candy and things. I worked at a laundromat cleaning the lint trap and filling up small bottles of bleach. I also shined shoes on the street corner. And I had a newspaper route which I did by bicycle - a bike I bought used for $10.

M: What about school? What type of school did you go to?

D: I went to a vocational high school and graduated from there. Then I went into the army for 2 years.

M: What did you do after the army?

D: I got a job as a clerk at an investment banking firm. I was making about $50 per week. And I went to a regular high school at night to take courses so I could get into college.

M: Then what?

D: After taking the high school courses, I went to City College of New York at night while still working as a clerk. I also did some sales for a friend on the weekend.

M: So did you finish college?

D: No, it got to be too much. I was working overtime for my job and it would have taken too long to finish college. Also by that time I got married.

M: So were you making a lot of money at this point?

D: No, maybe about 60 or 70 dollars per week. And then a friend told me about becoming a court reporter. He said I could make good money. So I went to court reporting school at night for one year. After finishing I got a court reporting job making about $95 per week.

M: When was this?

D: It was 1962 and we had two young children. Times were still tough. We sold our car when the first baby was born to cut down on expenses. I commuted round trip on the train to work for 3 hours total. And we took very few vacations. I did this for about 5 years.

M: And then what happened?

D: I heard about a court reporting opportunity in Pennsylvania with the potential to do a lot of extra night work. All of our family lived in New York and had never lived anywhere else, but I checked out the job.

M: And I know you took it since I was born in Pennsylvania in 1967. Wasn't it hard to leave your extended family and your home state? Why did you do it?

D: I wanted to provide opportunities for my children that I didn't have and the commute would be much shorter and provide for a better quality of life. Yes, it was difficult to leave New York, but it turned out to be a great move for our family. I was able to do a lot of nightwork to make extra money. Plus the cost of living was lower, so we were able to buy our first house.

M: Were you able to live extravagantly with this extra money?

D: Not extravagantly. We did do some things to increase our lifestyle. The house we bought was in an upper middle-class neighborhood. And we took a few vacations. But we lived on only 2/3rds of our income and we saved the other third. We did this by living pretty frugally. We still shopped on the clearance racks. We didn't go out to fancy places or buy expensive cars.

M: What did you do with the money you saved?

D: I invested it. I learned about invesments and stocks when I was a clerk. And I would listen to financial radio stations and I'd read Money magazine.

M: By the time I was growing up, we were doing pretty well. I remember camp and vacations. But I also remember buying clothes in Sears and eating at home. We never had designer clothes or the latest fads for electronics or anything.

D: Yes, we were more frugal than many of our neighbors. Also, I was one of the few dads in the neighborhood without a college education.

M: What advice do you have for people who are trying to save money?

D: Live on less than you earn. Put away the rest into savings for the future. That's what we did. We never lived beyond our means. If we didn't have the money, we didn't buy it.

M: And now look at you. You put all three of your kids through college, retired at 60, and have a condo in Florida.

D: Yes, but it's not near the ocean - it's a modest apartment. It was a present to myself and your mother for all of our frugalness and hard work during our lifetimes.

M: You deserve it. Thanks, Dad for your taking the time to give me this interview. And thank you for the example you set for me. I always appreciated how hard you worked to make it easy for us. You were a big inspiration to me growing up regarding being frugal with your money and saving it for the future.

Saturday, January 17, 2009

Take The Scenic Route

Saving Money Tip #55 - Take the Scenic Route. In today's busy world, we are usually in a hurry to get somewhere. And because of that, most of us take the highway when we have somewhere we need to go. The speeds are higher. There's no stopping and starting. And there are few distractions to take you off course. However, sometimes, it really pays to take the scenic route if you are not in a hurry.

You can save money in tolls:
If you live in the East Coast, you know that there are plenty of highways that are toll roads. And those tolls are not just a quarter or a dollar these days. The Verazanno Bridge is $10 to cross it! The toll on I-95 in Delaware is $4 each way. And the Pennsylvania Turnpike isn't cheap. It costs a couple of bucks to go about 20 miles. I'm sure other parts of the country has its share of tolls, too, although I am not personally familiar with them. However, I have found on the East Coast, by taking the scenic route - state highways or other less-traveled non-toll roads, you can avoid many expensive fees - often saving $10 or $20 per trip.

You can eat cheaply:
Going on non-main roads brings you into the heart of many cities and towns. There are many alternatives to fast food in these "hometowns." There are tasty diners and coffee shops that are frequented by locals but unknown to travelers. Often these mom and pop restaurants have good food at great prices.

You can save when buying gasoline:
Many of those gas stations right off the exits on the highways or in the travelers service station are overpriced, taking advantage of the convenience they offer you. On lesser roads, you can avoid this "convenience fee" and pay regular local prices for gas.

You may actually use less gas:
Experts on gasoline usage say that your car gets the best mileage when doing 55. But on highways, the speed limit is often 65 or even 70. On state highways, the speed limit is often 55, the perfect speed for maximizing your gasoline usage. Of course the scenic route may be longer and there may be starting and stopping, but not always.

In Real Life (IRL) - We live in part of the most-populated area of the country. We are in the DC area, and my family lives in Philadelphia. Therefore, we were traveling up the I-95 corrider quite often. But, we got sick of paying the high tolls that they were charging us on I-95: $2 each way at the Baltimore tunnels, $5 one way on the Millard E. Tydings Bridge, and $4 each way at the Delaware/Maryland border. So it cost us $17 just in tolls to visit our family. This was in addition to the high price of gas we were paying earlier this year. There wasn't much we could do about the gas prices. But we could do something about the tolls. We started traveling up Route 1 to visit our family. We still had to pay the $2 tolls at the Baltimore tunnel, but we avoided everything else.

That was $13 more we had in our pocket by taking the scenic route. And it is scenic. It has many farms, mom and pop restaurants, a huge aquaduct, and a thrift store that we like to shop at. For the $13 we save in tolls, we can feed our family dinner on the way. We sometimes find a deal or two at the thrift store. And the gas prices are cheaper than in our hometown. So we always fill up! On the negative side, for part of the ride, there is starting and stopping. And it does take us longer overall to get to our relatives' homes. But, the price we save on the tolls and at the gas station alone makes it worthwhile for us. And while not a monetary savings, my family can see beautiful scenic views of the countryside and of an historic aquaduct. These are things that we would never find on 95!

Friday, January 16, 2009

Consider The Alternatives

Tip #54 - Consider The Alternatives. We are given so many choices these days. If you go to the store to buy cold medicine, there are about 15 different varieties to buy. If you want to buy soda, there are about 8 different choices just for one brand. Have you bought bread recently? There must be at least 10 varieties of that, too! We are making decisions all of the time for the simplest purchase. Would I like the white with a bit of wheat? The whole wheat? The light wheat? Do I want soda with 1 calorie with caffeine or soda with calories and no caffeine? Do I want to buy the non-drowsy medicine that will help my aches or one that will put me to sleep and help my stuffiness?

Our brains are now wired to put lots of thought into every purchase we buy. Why not put that wiring of our brains to our advantage and use it to save money? Let's consider each purchase we make as if it's cold medicine and consider the alternatives. Some alternatives will be great and will save you lots of money, while other alternatives will leave you wishing you didn't have to save money. But you won't know which are the good ones until you consider them. Here are some ideas:

--If you usually take a trip to the seashore every summer, why not consider a trip to the mountains with a lake?

--If you eat out pizza every Friday night, why not make the pizza yourself?

--If you usually drive to work by yourself, why not try doing a carpool or taking a bus?

--If you usually go the movies every Saturday night, why not consider renting one or even better trading with friends or borrowing from the library?

--If you usually set your thermostat at 70 in the winter, why not try lowering it to 68 and putting on a sweater and using warm blankets?

--If you usually join a swim club, why not consider going to a county pool?

--If you usually do a getaway to the Carribbean every winter to escape the cold, why not go to the Southern part of the US instead?

--If you usually buy your lunch at work, why not bring your meal?

--If you usually drive your kids to school, why not try walking them there instead?

--If you usually use expensive shampoo, why not try switching to a no-name brand?

--If you go on vacation every summer, why not try going in the fall or spring instead?

--If you use a towel only once after a shower, why not try using it twice?

--If you usually put your dog in a kennel, why not consider asking your neighbors to watch her instead?

These are just several areas I came up with where there are alternatives to consider when spending your money. Some of these you would probably never do to begin with, and others you would never consider doing the alternative. Everyone has to figure out for themselves what they are willing to do to cut down on spending. But remember, there are almost always alternatives out there. There are often cheaper ways of doing things. Before you spend money, think about how you can accomplish what you want to do using a cheaper method.

In Real Life (IRL) - I seem to always look for a cheap way to do things. I borrow books at the library instead of buying. I buy used clothes for my children instead of new, and I eat in rather than eat out. I try to get the most for the money I do spend. So anytime I make a purchase, I try to consider how I can get the same satisfaction for less money. If I can't get the same satisfaction, then I stick with my original plan. I'll give some examples of alternatives I have tried in an effort to save money. Some worked, while others did not.

--My husband loves the Outer Banks, which is a beach in North Carolina. Since he moved away from North Carolina when he married me, I figured the least I could do is keep him happy with occasional beach weekends in his favorite state. Last summer he said we should plan to take the kids and show them his favorite seashore. But when I looked at the prices -about $150 per night for a basic hotel - I told him it wasn't in our budget. But he threw it back at me that we visit my favorite beach resort with my family ever summer in New Jersey, the least we could do is visit his as well. And he had a point.
So I thought about it and remembered that my daughter's school has a two-day break in early November. And the North Carolina beaches usually still have pretty warm weather that time of year. So I check the prices for the same hotel in early November - $65 per night! Best of all, we could cancel the reservation up to the day of arrival, if the weather was bad. It turned out that it was in the low 60s and sunny for the whole weekend. We had a great trip for about 1/3 of the price of the summer. This was a great alternative!

--We keep our heat on 70 degrees in our house in the winter. Our house is old, so it heats unevenly - with some rooms being warm and toasty and others being quiet cold. But of course I had to try the alternative that every money-saving article suggests - lower the thermostat a degree or two to save on our heating bill. And I did it. And I hated it. Then I tried it a few weeks later and I hated it again. Then I tried the following year and I hated it a third time. I really just hate being cold. So to me, this alternative was a flop, but for some people, it's worth a try.

--When we go away, we used to put our dog in the kennel. It cost about $20 per night. Unfortunately, the kennel is closed on Sundays. And because we would often leave on Saturday and come back on Sunday, we would have to keep the dog in the kennel until Monday morning. So for a weekend trip we were paying about $40. Sometimes we would even have to put the dog in on Friday, since the kennel is quite a distance from our house and we often needed to get an early start on Saturday. Those times the cost was $60 for the weekend! We did this for about 5 years when my husband decided that our dog was getting too old for the kennel. So he asked our teenage neighbor if he'd like to earn $10 bucks a day walking our dog and feeding her. This boy and his sister and brother loved our dog because they didn't have one of their own. They are also very nice, responsible kids. The boy jumped at the chance, and we haven't looked back. Instead of paying $40 or $60 for a weekend trip, we pay $20. Plus the dog gets to stay in the comfort of our house, and our neighbor makes some nice side money. It's a win-win situation. This was a great alternative for us!

--I usually am happy with store-brand foods. I don't think I have very discriminating tastes. I can't tell the difference between low-fat and regular cream cheese or Philadelphia brand and the store brand. Although my mom swears the Philadelphia brand tastes much better. But I'm happy with the cheaper store brand cream cheese. So one day when I was out of ketchup and we needed some, I bought the store-brand in an effort to save money. And try as I might, I could not get used to the stuff. I realize now that I have a taste for Heinz ketchup and only Heinz ketchup. So, now I to stock up on Heinz when it goes on sale. Because I will just not buy any other brand even if it saves me money. Store-brand ketchup was not a good alternative for me.

--One last example. When I was single and living in an apartment in the suburbs, there was a free bus from the complex that drove us downtown where I worked. This was a great alternative to paying about $2 per trip on public transportation to get downtown. There were two problems with this bus - it got me downtown about an hour before I needed to be there and it dropped me off in the business district. And my office was not in the business district - it was about 10 blocks (or one Metro stop) away. I could have hopped on the Metro and spent $1.10 to travel that one stop. But instead I made the 10- or 15-minute walk every morning to save the money. After all, I had the time and I was young. This was a great alternative for me. I got free transportation to work - practically unheard of. Plus I got exercise and a close-up look at our nation's capital. I appreciate those days so much now because I don't work in the city anymore and I don't get downtown very often. I'm happy I did it back then when I had the opportunity and I saved money while I was at it!

So there you have it, money-saving alternatives that have saved us money and those that didn't work for us. What alternatives can you try to save money?

Thursday, January 15, 2009

Put Your Finances In Perspective

Tip #53 - Put Your Finances In Perspective. Everyone is at a different place financially. Some individuals or families live on $30,000 per year. Others live on $60,000, while still others live on $100,000 or even $250,000 per year. Obviously, these households are in different categories when it comes to finances. The amount of money someone with a $250,000 income needs to save for retirement is drastically different than what someone with a $30,000 income needs to save. And because basic necessities take up a greater part of the $30,000 income percentage-wise, the household with the $250,000 income has a lot more income to spend on other things - vacations, fancy clothes, eating out, etc.

In addition, where you are today is different than where other people are. Maybe you had to put yourself through college. Or perhaps you never had health insurance. Or maybe you just weren't a careful spender because you were never taught to be one. So you have a lot of debt, whereas other people got a great start in life and didn't have to go into debt because their parents financed many things for them.

This is a long way of saying you should not compare yourself to someone else when it comes to finances (or most other things for that matter). Otherwise, it would be easy to get discouraged. For some people, a yearly vacation to the Carribbean is in their budget, and they are still saving what they need for retirement. For other people, a weekend trip to Dayton, Ohio would be a budget buster.

And while we would all love to be the ones with the $250,000 income and the budget that includes vacations and dinners out, the reality is that we need to realistically look at our own incomes and debts and what expenses we can afford today. By working on our own fianancial goals, we can hopefully reach the point of being comfortable living on less than we earn. And maybe then we can try to reach for higher plateaus, if we so desire. So we can enjoy the occasional vacation to the Carribbean or even Dayton.

In Real Life (IRL) - I got a pretty good start in life. I know it. I lived in a nice 4-bedroom house in an upper-middle class neighborhood. I went to summer camp every summer. My parents paid for my college education and I was given a car at graduation (not a fancy one, but a nice, reliable car). I never knew my parents to have any money problems. So I had a good start in life. When I got my first job out of college, I did not come in with any debt - no school loans, no car loans, and no medical bills. I was free and clear and at that point on I could do what I wanted with my money.

I realize I was much better off than some people to start a savings plan. I was able to put $200 away each month toward a home while others were sending that same $200 to pay off their student loans. And I suppose if someone was comparing themselves to me then that person may feel it wasn't fair because she couldn't save in the same manner that I did because she had more financial obligations from the get go. But in the same vein, I could look at people whose parents gave them a down-payment on a home (I have friends whose parents did this), paid for their child to go on a vacation with them (again I know a few cases of this) and took them out to fancy dinners on occasion. And I could say the same thing, that person had fewer financial obligations from the get go.
But in doing this, we are not helping our own cause. We are where we are finanically today - some because of what we were given and some because of what we brought on ourselves. The point is to just look at our own financial situations today and work from there. And let the others take care of themselves.

Wednesday, January 14, 2009

7 Money Saving Strategies

I was in Yahoo early this morning and saw this article from Kiplinger's about 7 money-saving strategies. There's nothing in there I haven't read before, but it's always worth it to have some reminders of some good ideas.

Monday, January 12, 2009

Have Patience When Building Your Savings

Tip #52 - Have Patience When Building Your Savings. Building up your savings takes time. A lot of time. It doesn't happen overnight. It's unrealistic to think you will win the lottery, get a windfall from a long-lost relative, or hit triple 7s in the casino. Those things happen to very few people. The rest of us need to build up our savings slowly in order to have a significant amount of money.

Twenty-five thousand dollars sounds like a lot of money. It is! If you won $25,000 in the lottery, you would be ecstatic. Well, don't count on that, but you can save $25,000 pretty easily. Put away $200 per month and in about 10 years you, too, will have $25,000! Ten years sounds like a long time, but remember the idea is to save a little bit everyday. And that little bit will add up to a lot in a few years' time.
Many people fall into the trap of thinking that they will never have a lot of money unless they win it. I hear, "If I win the lottery" so many times, I could scream. Anybody can accumulate money. Just save a little bit everyday. Put it away each month, and your savings will add up to a large sum. It just takes time and patience. It sounds basic, but it works.

In Real Life (IRL) - I started saving money when I was 22 - fresh out of college. Each month I put a little away because I lived on less than I earned. I remember making spreadsheets about how long it would take me to attain a certain amount. I had goals for when I would reach $100,000, $500,000, and even one million dollars! And while it seemed far off in the future that these events would happen, time went very fast, as it often seems to.

I am 41 years old now, so it's been almost 20 years since I started saving money month after month. Thank goodness for those early saving days. I haven't reached a million dollars yet, but, we are getting closer. We still put money away each month - especially for retirement. It goes off into the savings accounts and I don't even think about it. But it's there.

We hope to retire in about 20 years, and I'm sure that time will seem to go even faster than the last 20 did. But by putting away some money each month, I can be assured that I will have a large amount of money when I retire. Because I am building my savings slowly - one month at a time. It's the only way to do it.

Saturday, January 10, 2009

How To Sell On Craigslist - A Tutorial

Tip # 51 - Sell It On Craigslist. One of my earlier tips is to sell what you do not need anymore. Great venues for selling things are yardsales, Ebay, and Craigslist. There are other local venues such as consignment stores, seasonal consignment sales, and flea markets. But I think Craigslist is the easiest place to start. So we'll talk today about how to sell on Craigslist.

I always take it for granted that other people sell on Craigslist or if they do not, then they would at least know how to if they wanted. But I have recently found out that this is not necessarily the case. Many people do not buy and sell used things like I do. And some people are intimidated by listing things on Craigslist. I'm here to tell you that there is nothing to be afraid of. Craigslist is really just an online classified ad. You write up a classified ad for what you want to sell and you put it online. That's it! Years ago, the supermarket would often have a bulletin board and you could put up an index card with what you were selling. If you were lucky someone wanting your item would read the board and call you. Craigslist is the same thing - only it's on the computer; it reaches many more people, and the item will often sell more quickly.

Let's go through a tutorial of how to sell on Craigslist.

Figure out what it is you have to sell - a sewing machine? Your 1950's dishes? A winter jacket? Your son's crib that he's outgrown? In general, the more unique the item, the less likely I would be to put it on Craigslist. For something very rare, you want to put it on eBay or at an auction house where you have thousands of people and/or the right people looking at it. More general items are perfect to sell on Craigslist. Your great-uncle's very rare collection of civil war coins would not sell for what it's worth on Craigslist. A collection of your HO-scale trains might. If you do your research.

Research, research, and research! Don't overlook this step. It is the most important step for pricing your item correctly. Figure out what you have. Remember Craiglist is not an auction site. People are not bidding on your item. It is a classified ad. You are setting the price. You don't want to sell an antique valuable for much less than it's worth. And you don't want to overprice a generic item or it won't sell.

So how do you start the research? Look over your item for a brand name, a model number or something similar. For example, look at the sewing machine. What is the brand name? Is it a Sears? Or is it a Singer? A Singer? What is the model number? 401A? Great! Now you now know what you have. Now go over to eBay and look up what they are selling for. Search for Singer 401A. There are few of them up there now. One of them currently has a bid of $255 with just hours left on the auction. One person is asking $320 or best offer. Finally, someone's auction is currently at $51 with 5 days left.

Even better than finding out what people are asking or where the auctions are currently at, is to look at completed auctions. This will show what an item actually sold for. To use this function, you do need to have an account with eBay. If you suspect that the item you are holding is fairly valuable, then it's worth signing up on eBay (it's free) to look at completed auctions. If you look at completed items for the Singer 401A Sewing Machine, you would find that the highest priced one sold for $339 plus shipping and the lowest priced one went for $39 plus shipping, with most of them selling for over $100.

Next you will want to look at a few of these auctions and figure out why some are selling for more than others. Those selling for the most money probably have all of the parts, are in good condition, and might have extra accessories. The ones selling for the least money may be missing parts or may be in poor condition.

Now you have a good idea of what your item is worth. Look yours over and compare it to the ones being sold on eBay? Does yours work? Yes. Are all of the parts there? Yes. Is it in good condition? Yes. Does it have an accessory kit with it? No. So you figure out that a Singer sewing machine model 401A in your condition sells for about $175 on eBay plus shipping. Now you have to decide what to price yours at on Craigslist.

Remember, eBay has millions of users. In any given week, hundreds of people may be looking for a Singer 401A machine on eBay. And because of that, there may be dozens of bidders on a particular unit and people are bidding against each other. In your town, you may be lucky to have a few people looking for a Singer 401A, so price it accordingly. In most cases, people will not bid up an item on Craigslist. Also, a knowledgeable buyer will look up prices on eBay for an item he wants, so you do not want to outprice eBay. On the other hand, many people do not want to pay shipping, especially for something as big as a sewing machine and many people prefer to look at an item and test it out before they buy. In which case, Craigslist is prefreable to eBay. Taking all that into account, you should probably price your item a bit lower than eBay prices without shipping. Generally prices are cheaper on Craigslist. One hundred and fifty dollars may be a good price.

Let's get started on listing! If you have a digital camera, then snap some photos of your item. Taking pictures in daylight is best or in a well-lit room. Take a far-away shot and a couple of close-up shots. Craigslist allows for 4 pictures per ad, but they are pretty small so they don't have to be perfect. You can put photos on a hosting site if you want to do many pictures or bigger ones, but we'll save that for a more advanced tutorial. Next, you want to upload your pictures onto your computer.

And now it's time to start working on your ad. You can write it up in a Word document and then cut and paste it into Craigslist if you want. Or you can type it in directly. If you are typing it in directly:
--Open up the Craigslist site for your city. On the lefthand side is an option that says "Post to Classifieds." Click on that.
--It then asks what type of posting this is. Click on "For Sale".
--Now you must decide what category sewing machines fall into. My guess would be household items. But, some might put it in collectibles since this is a fairly collectible sewing machine. Others might put it in the general category. What you can do is open up another window of Craigslist and do a search on sewing machines and see where most people are listing them. I just did that and it does seem like a mixed bag - household items, collectibles, general, and even some in furniture. I would stick with household or maybe collectible. But ultimately, it probably doesn't matter much, especially if your Craigslist is pretty small. Most people will search the overall board rather than a specific category. So you pick household items.
--Next, it might ask you what specific area of your city you want to post to. If your Craigslist area is small, it might skip this step. Pick your closest area.
--And now you are up to the listing! First type in a title. Keep it relevant. The Brand name, the item it is and the model number. And if it comes in different colors or sizes, add that. For this item, I would write "Singer Sewing Machine Model 401A."
--Next put in your price. No need for dollar signs or decimals. Just type in "150."
--Next put in your town or city.
--Finally, type up your listing. Make sure you include its condition, all that it comes with and anything else you may know about it such as "It's been in my family for years. It works perfectly." Towards the end, make sure you put in the particulars. "Pick up Springfield. Cash only. Email me with any questions." Keep it simple and direct. Tip: it's best to deal with cash with strangers on Craigslist.
--Type in your email address - twice. No one will see your email address. Craigslist anonymizes it for you. So people can respond via email, but it goes through Craiglist's relay system so the person responding does not know who he or she is responding to.
--Click on "add/edit images"
--Use the browse button to find your sewing machine photos on your computer. Add them one by one and when you have all four addresses in there, click "continue"
--It will take a few minutes to upload the photos to the Craigslist ad.
--It will now show you your ad. At this point you can edit it if there are any mistakes. Or you can continue.
--Read the terms of use and accept them.
--Key in the security words that you see.
--You are almost done! You will now get an email from Craigslist to confirm your ad.
--Open the email and click on the link.
--Click on "Publish" and you are done.

In most places, the ad will stay up for 30 days. In bigger cities, the ads may only stay up for 7 days.

Hopefully, you will start getting some replies. They will come directly into your email and you will see the email addresss of the person responding to you. Once you answer an email, that person will see your email address. You will often get people offering you lower money that what you are asking. If it's reasonable, then you can say you will consider it. Sometimes you will get ridiculous low-ball offers. Oftentimes, I just ignore those emails. I think there are some people who just go on Craigslist offering ridiculously low prices on items and they are not serious buyers.

Once you get someone who appears to be a potential serious buyer, set up a time to meet them. I always have people come to my house. But I know others who are not comfortable with this, and they meet them in a public place - the parking lot of a shopping center, the library, a mall, etc. Do what you feel comfortable with. Show the person your item. Describe the features. Show the person that it works. The buyer may offer you a bit less at this point. Unless you have several other potential buyers in the wings, then accept his/her offer. Remember to only accept cash.

You did it! You have just sold your first item on Craigslist. Don't forget to go into your inbox and find the link to your item. Delete the ad so you aren't receiving more replies to it. Now go find what else you want to get rid of and start making some money!

Note: Some people do not have a digital camera and cannot include pictures in their Craigslist ad. That's okay. You have nothing to lose. Your ad doesn't cost anything. I think pictures improve an ad 100 percent, but it's not mandatory.

In Real Life (IRL) - I have literally sold hundreds of items on Craigslist. I love it! It's free. I can list dozens of items and even if they do not sell, then I am not out any money. There are no fees associated with selling on Craigslist so I can accept less money than I would on eBay. And because I live in a big city, there is a pretty large pool of people here who are buying. I have sold furniture, dolls, collectibles, shoes, clothing, games, toys, and more. Some things sell the same day I list them. Others take several relists and several price reductions before they sell. And there are some things I give up on and donate.

I have cleaned out my children's toys and listed the more desireable ones on Craigslist. I have listed some better name label kids' clothes on Craigslist (they do better in large lots) and items such as snowboots or snowsuits. We have gotten rid of my husband's old childhood dark wood furniture (this took several listings and price reductions to sell) and a dining room breakfront (also took a few price reductions). I've sold American Girl dolls - often on the same day I listed them. I have sold our old play kitchen, a few sand and water tables and other large play structures. These are perfect for Craigslist since people do not want to pay shipping on large items. I've sold baby gates and strollers. We've sold bikes and scooters. The list goes on and on. And I see no end. I am constantly getting rid of outgrown toys, and occasionally I find something at a thrift store that will sell well on Craigslist. It's a great source of income and also a great motivator to declutter! Try it.

Friday, January 9, 2009

Bring Your Own Lunch

Tip #50 - Bring Your Own Lunch. This tip goes along with eating at home instead eating out. But I thought it deserved its own entry since some people don't consider buying lunch in the work cafeteria or in the school lunchroom "eating out." Heck, I don't blame them; the food is not exactly gourmet. So why waste money buying food in a school or work cafeteria when you can eat more cheaply and nutriciously bringing your own lunch? Because it takes more time. It does.

Let's face it, it's a pain to make a lunch every morning when you are trying to get ready for work or get the kids ready for school. It's so much easier to put a few bills in your pocket and worry about it later. Or nowadays, the schools have electronic lunch accounts so you keep a balance at school and your child just needs to key in a code. Easy! And when the money runs out, you can replenish the account with your credit card and for a small fee, of course. Instead of falling into this easy trap of buying lunches at work or school, how about if it were easier to make lunch? Then we'd be more likely to take it.

On Sunday evenings or whatever day works for you, decide what you will make for five lunches for during the week. Let's assume you are doing this for one child. You want to give them some variety - so try not to make the same lunch for more than 2 or at most 3 days. Possibilities include peanut butter and jelly sandwiches, lunch meat or cheese sandwiches or wraps, yogurt, hummus and pita, hard-boiled eggs or egg salad. We can make lunches for the week in 5 easy steps.

1. Assuming it's Sunday, then try to make as many preparations as possible for the upcoming week. Peanut butter and jelly sandwiches freeze very well. So make a couple of sandwiches - put them in a plastic container (or plastic storage bag) and throw them in the freezer. These are two lunches for later in the week (Wednesday and Friday) that you don't have to worry about. Boil an egg and put it in a container in the fridge. This will be lunch for Tuesday. Make a lunch meat sandwich for Monday. Then you can give yogurt for lunch on Thursday. This offers a nice variety and is very easy to do in about 30 minutes' time on a Sunday night.

2. For sides that go along with the main lunch, you can package them up and throw them in the freezer as you make them. If you are making banana bread during the week, cut up five pieces and put them in five small containers (or plastic storage bags) for lunchtime meals over the next two weeks. Again, try to offer variety so your child isn't eating banana bread every day. Two or three days during the week should be the maximum. Do the same for muffins or cookies. All of these items freeze well. Try to have about 10 items in the freezer in small containers for lunch for the upcoming two weeks. Tailor this to how often you bake. If you bake a few different items every week, then you can do this weekly and have five items in the freezer at all times. If you bake monthly, then you can put in a month's worth of individually-wrapped bread items for lunches.

3. You probably want to pack another side for lunch in addition to the main lunch and a bread item. Yogurt or a piece of cheese are healthy side items on days when they are not the main entree. Depending on how much your child will eat, yogurt may need to be packaged in smaller containers than the 6 or 8 ounce containers they come in. I try not to do this more than two days in advance. Or you can use yogurt tubes (which may cost more and has more packaging). Same thing for cheese, don't prepackage those more than two days in advance because it may get hard. Or use pre-packaged cheese such as string cheese.

4. The next item should be a fruit or vegetable. Some fruits don't do well when cut in advance. Others do. The ones that do not do well should be reserved for the next morning (Monday). On Sunday you can wash grapes or grape tomatoes and pre-package them in two individual containers for later in the week (say Tuesday and Thursday). Some melons also do okay pre-cut for a few days. Apples, not so much. You can probably cut one up the night before and put some lemon juice or orange juice on it to stop it from getting brown. Or you can include a small apple that doesn't need to be cut. Again, this would be good item for Monday. Bananas can be thrown in the lunch box as is on Wednesday and Friday. Again, try for variety, an apple one day, a banana two days and grapes or grape tomatoes the other two days.

5. Fill up a container with water, juice or other beverage. On the evening before work or school or even the morning of, you can pull out all of the pre-packaged items and throw them in your lunch box. Even if you put them in your lunch container in the morning, items that were in the freezer will thaw by lunchtime.

And there it is, lunchtime made easy. We'll talk about cost savings in the IRL section.

In Real Life (IRL) - My daughter brings her lunch almost every day to school. Being the frugal person that I am, I figured out that her lunch costs us about $1 or so per day to make versus $2.40 to buy at school. We save at least $1 per day when she brings instead of buying. She does buy when they have macaroni and cheese or grilled cheese, which is usually about twice per month.

These are the options I usually send her for lunch:

Yogurt (45 cents)
String Cheese (20 cents)
Crackers (10 cents) or a homemade soft pretzel (15 cents)
Banana (20 cents)
Water (Free) or Fruit Juice (15 cents)

Peanut Butter and Jelly Sandwich (50 cents)
String Cheese (20 cents)
Grapes (20 cents)
Homemade Cookies (20 cents)
Water (Free) or Fruit Juice (15 cents)

Egg Salad (20 cents) or Hard-Boiled Egg (15 cents)
String Cheese (20 cents)
Peanut Butter Crackers (15 cents)
Small Apple (40 cents)
Water (Free) or Fruit Juice (15 cents)

Hummus (30 cents)
Pita (30 cents)
Grape Tomatoes (20 cents)
Baby Carrots (10 cents)
Banana Bread or Homemade Muffin (15 cents)
Water (Free) or Fruit Juice (15 cents)

Mini Bagel (25 cents)
Cream Cheese (15 cents)
Banana Bread (15 cents)
Fruit cocktail (20 cents)
1/2 Yogurt (25 cents)
Water (Free) or Fruit Juice (15 cents)

Of course this assumes I buy things at the best price possible. String cheese is 20 cents per string only if I buy it at Costco. Same thing for peanut butter crackers. Yogurt is 45 cents at Costco or sometimes I get it for 40 cents if they are having a good sale at Safeway or Giant. I buy Apples when they are 99 cents a pound, crackers when they are on sale for a certain price, etc. Hummus and pita I buy at Trader Joe's. If I started buying things that aren't on sale or more convenience foods, then the price would go up, obviously. These are the items I generally stick with. In the springtime, I will buy fruits that are in season trying to get fruits that are on sale for 99 cents per pound. And I do mix these items around. I generally try to have a main item, a fruit, a cheese and one other thing like a muffin.

Over the course of a year, I figure we save about $200 by doing lunch this way. And I think she eats healthier options. When all three of my children are in school, we will be saving even more money by having them bring their lunches instead of buying.

Wednesday, January 7, 2009

Prepare For The Unexpected

Tip #49 - Prepare For The Unexpected. This sounds like such a cliche. And it is. For good reason. None of us know what the future has in store for us. A job layoff? Illness? Another child? A car accident? Many of these things can happen at any moment. How will your finances hold up if one of these happens? Will you be able to survive on your regular path? Will you be able to manage on a different path? Or will one of these changes devestate you financially?

Let's look at an example. Suppose your air conditioning unit gives out. If you have the $2,000 it costs to replace it with a new unit, your life goes on its regular path. Or suppose you only have $800 saved but are fortunate enough to to find a used unit? This can tide you over for a few years. But what if you have nothing saved? You will have to manage on a different path. You live without air conditioning. Fortunately, the failure of an air conditioning unit shouldn't devestate you financially.

But what if you lost your job? If you have money saved, you may be able to cover your expenses until you find a new job. If you don't have money saved, you may be able to live off your spouse's income by drastically cutting expenses until you find a new job. If you have no money saved, losing your job may devestate you financially. Your spouse may have a very low paying job that even with cutting expenses you cannot live off his or her income. If this happens, you can go into debt or get behind on your bills until bad becomes worse.

What should you do so one event doesn't devestate you financially? To steal the Boy Scouts' motto, "Be Prepared." First and foremost you should have an emergency savings fund. Financial experts often recommend having a savings fund to cover 3-6 months' worth of expenses. So if you normally spend $3000 per month on expenses, then you should have between $9,000 and $18,000 socked away in a savings account - money you can get to pretty easily if you need it. Oftentimes you won't need all of it. If the air conditioning unit in your house gives out and you need $2,000 to replace it, take it out of your emergency fund and life goes on and you can slowly build your emergency fund back up. A car accident in which your car is totaled will take more money. You may collect money from your insurance, but it often doesn't cover the cost of a new car. So you have to come up with the difference which may be $5,000.

But what happens if you are laid off? You may be given two weeks' severance pay and then you have no income coming in. This is when an emergency fund really comes in handy. This is when you have to live off your fund until you find a new job. Depending on the market, it could take several months which is why it is a good idea to have several months worth of expenses saved. By being prepared you can prevent yourself from going in financial ruin.

Suppose you don't have 3-6 months' worth of expenses saved? Well, in addition to establishing an emergency fund, try to think of a back-up plan until you have that fund in place. Think about a plan before the unexpected happens. What will you do if your car suddenly doesn't work any more and you cannot afford a new one? Can you take the bus to work for a year? Can you commute with a neighbor? If your spouse loses his job, do you have ideas on how you can make money? Do you know what expenses can be cut out immediately to reduce your liabilities?

In addition to just reacting to events that happen, you can try to predict what events are coming your way. If you know your roof is old, then you can expect in the next few years that you will need to replace it. If you are hearing some grumbling at work about layoffs, then you can start feeling out the job market. If your car has been in the shop a lot in the past year, then you should think about how you will replace it. Then some of these "unexpected" events won't be so unexpected.

Remember, unexpected events happens all of the time. Cars break down, roofs start leaking, and people get ill or lose their jobs. Try to be as best prepared as you can be for them.

In Real Life (IRL) - Our air conditioning unit broke a month ago in our condo in Florida. After calling several places, I was able to find a reputable installer to put one in for $2,000. To be honest, I didn't see this expense coming. And I should have. After all, the unit was 35 years old! But it's there in Florida and I'm here in Virginia, and I don't usually give that condo much thought. I think of it as my mother-in-law's since she stays there. But the deal is that we handle the upkeep and maintenace of it. So we begrudingly handed over $2,000 for a new air conditioning unit. Fortunately, we have money saved for such "emergencies." But now we do have to replenish our emergency fund.

A few years ago we bought a new roof. Fortunately, we knew this unexpected event was coming. My husband is handy, and he had been repairing the holes and leaks as they literally sprang up. But after a few years of doing this, we knew that it was time to get a new roof. Because we knew it was coming, we had the money for it. When we bought our home, we didn't use all of our money for a down payment. We left $20,000 aside for repairs and maintenance. So while we did keep putting off replacing the roof, we finally parted with our money and hired someone to put on a new one. If we didn't have that savings, we probably could have muddled along for a few more years. But we had a plan in place for this "unexpected" event.

We are in another situation now that we are trying to prepare for. It is a possible shut-down of my husband's office. The writing has been on the wall for a few years. His office isn't performing up to speed. And my husband thinks it's a possibility that the main office of his company will close down his branch. We do feel that he won't lose his job altogether but we know there is a possibility he would be moved to the main branch of his office in another state. So we are preparing ourselves for this possibility. We are preparing ourselves mentally that a move may be in our future. We are preparing our house physically by keeping on top of repairs so we can hopefully sell it fairly quickly if we need to. And we are preparing ourselves logically by looking into other possibilities for a job if we don't want to make the move. One option is that I go back to work full-time. And while I don't make as much as my husband does, it will relieve some of the pressure on him. It would be easier for him to find a lower-paying job if he needs to find one. And if none of these options happen, we do have an emergency fund in place. It has about 6 months' worth of expenses in it so we would be okay for the short-term.

I'll share one more "real life" story. When I was younger I had a friend whose dad lost his job. We lived in Pennsylvania and the one job offer he received was in South Carolina. Her family really did not want to move as their extended family all lived nearby. But they would if they had to. But instead, they decided to have her mother open up a business. It wasn't a totally spontaneous decision. She had a small business out of her home personalizing jewelry and ceramics. It was a hobby or a side job so they decided to expand it and live off the business income. They started with a kiosk in a mall. And then they opened up in a retail store in a small downtown business district. My friend's name came up in conversation a few weeks ago, and I decided to google her mother's business. Sure enough, it is still there - 25 years later! I'm guessing that opening this business was something they had always talked about. Otherwise I don't think they would have jumped into it so quickly. By having a plan for an unexpected emergency, they were able to follow another path financially without being devestated. What preparations have you done?

Monday, January 5, 2009

Set Financial Goals

Tip #48 - Set Financial Goals - Now that we have a new year ahead of us, it is time to set up financial goals. To go hand and hand with writing up a budget, write down a list of what you want to accomplish in the upcoming year. These goals can might include saving $100 per month toward retirement. Or your list might have on it to pay off your last credit card. And it might list goals such as keeping your grocery budget down to $400 per month or to put away $25 per month for your child's education. Whatever your goals are, write them down.

Some people in the financial world would probably advise keeping your goals to be purely financial. But I like to put on there how you will accomplish these goals. For example, if your goal is to keep your grocery budget down to $400 per month, you might have listed beside it that says you will be cooking dinner from scratch 3 times per week instread of buying ready-made dinners. If your goal is to have a clothing budget of $50 per month, you might list corresponding goals of shopping for clothes at thrift stores or only buying your clothes at discount places.

After you write out your list of what you want to accomplish this year, then you can write up your budget to meet these goals. The budget will organize your goals into clear, financial terms. If you are going to cut out your daily coffee, then you don't need a line item in your budget for your coffee fix. If you want to pay off your last credit card bill, then you need to figure out how much you need to put in the budget each month to pay it off. If you can't get your budget and your goals to line up, then you will need to adjust one of them. If your budget shows that you only can put $50 per month toward retirement versus the $100 you had hoped, then you need to either cut something else out of your budget or adjust your goals for this year to save only $50 per month toward retirement.

After you finish this year's budget, then you can start another sheet of paper with long-term financial goals - perhaps goals over the next 3 to 5 years. So while you can only save $50 this year toward retirement, your long-term goal might be to save $100 per month. Then write it down in your 3-5 year plan. Remember, once your debts are paid off in the short-term (hopefully), then you will have more money available to you to start saving in the long-term. It's always good to think ahead to what expenses you will have in the future and what you want to accomplish.

In Real Life (IRL) - We haven't done our yearly budget yet, mostly because my husband hasn't gotten his review and raise yet for this year. Usually he gets it in December, but there has been some management changes in his place of employment and they haven't come out yet - if they are coming out at all. Once we find out for sure if and what his raise is, we will write out our yearly budget. I don't actually expect it to be all that different from last year's except for some minor tweaking. In the meantime, we have made up a list of our financial goals for this year. Our two main goals haven't changed for the last few years:
--Put the maximum into our retirement IRAs ($5,000 per adult)
--Put the maximum into our children's education ESAs ($2,000 each)
I've also added:
--Cutting our grocery budget down to $400 per month from $500 - hope to continue cooking more from scratch. I'd like to start baking my own bread. I want to go full-steam ahead with buying in bulk when I see a great price on things we use.
--I want to keep our children's summer activity costs at $1,000 total.

In the long term-
--I might look into going back to work (15 hours per week) in September. In which case will have extra income for 4 months. This extra income will go towards a savings fund for extra expenses we expect over the next few years such as braces and religious education.

--Next year in the fall, I expect to work even longer hours (24 hours per week) when my youngest is old enough to be in school for longer days.

--Pay off mortgage on condo by end of 2010. (We bought a condo with my husband's mother 5 years ago so she could have somewhere to spend the cold winters. She didn't have the money to buy it herself. Also, it's something we can use down the road. We pay off extra each month and our goal is to have it paid off completely by end of 2010.)

What are your financial goals?

Friday, January 2, 2009

Join A Credit Union

Tip #47 - Join A Credit Union. What is a credit union? A credit union is like a bank. Only they are not-for-profit and they are owned by its members. According to CUNA (Credit Union National Association) " unions to pay dividends to their members (not shareholders) and offer them lower loan rates, higher savings rates and fewer service fees..." Generally, a credit union offers competitive rates for loans and savings. They offer mortgages, home equity loans, car loans, and personal loans. They have savings accounts, checking accounts, CDs, retirement accounts, and education accounts. Pretty much anything your bank can do for you, a credit union can do, too. Only oftentimes it's cheaper or better.

When you have a mortgage through a credit union, it stays with the credit union. It is not sold to other third-party buyers. Usually, their fees are less than with mortgages from other institutions. They are generally more flexible with loans. For example, they might not require you to pay private mortgage insurance (PMI) with a mortgage through a credit union. For savings, their rates are as competitive as banks. They may not require you to keep a balance in their checking account as a bank does. There are many times other free services through the credit union - notary public, coin counting, etc.

How do you join a credit union? Oftentimes, you can join through your employer - schools, the military, civic organizations, etc. If you are interested in learning more about credit unions, check out the CUNA site. And if you want to see if you can qualify to join one, check out this credit union locator. You could save money and have better service by using a credit union rather than a bank, so check it out.

In Real Life (IRL) - My husband and I and now most of my extended family belong to Navy Federal Credit Union. If I'm not mistaken, they are the largest of all of the credit unions. If a family member belongs to the military or used to belong, then you may be eligible to join.
We have received great benefits from it. We have our mortgage through Navy Federal. And even though we put down more than 20 percent for a down payment, we would not have had to pay PMI had we put down only 10 percent. Our mortgage has never been sold to a third-party in the eight years that we have held it. We got a better interest rate than any commercial bank or other institution could offer us.

We have used their notary public service numerous times -all for free. We have opened up education IRAs and retirement IRAs for our family for competitive rates. We bring our coins in to get sorted and deposited into our account through a coin counter machine for free. My extended family has been able to join through us and they have benefited from Navy Federal's favorable terms. They have competitive CD rates for my parents and for my brother who buys and sells real estate, they are flexible and competitive with loan rates. I can't say enough good things about them. They go out of their way to help us if we want to move around money or do something out of the ordinary. I would estimate that we have saved thousands of dollars using their services over a traditional bank's services. If you get a chance, look into a credit union for yourself.