Friday, October 29, 2010

Frugal Friday: Flavored Water

For much of her infancy, my toddler was a "stopped up" little baby. I was so relieved when she was old enough to drink one ounce of prune juice a day, but being a petite miss, it didn't take much prune juice to get her going again. In fact, it got her going a little too much. We decided to give her a half ounce of juice diluted by another half ounce of purified water. This was just right for her. Still to this day at 2.5 years old, we serve her diluted juice, and she likes it!

As you know, most juices on the market today have way too much sugar. What if you add a little water to each serving? You and your kids would get as much of the refreshing sweetness you want without loading up on excess sugar and also making your juice supply last longer.

With my toddler, I can get away with 1/3 juice, 2/3 water. Sometimes, I can get away with 1/4 juice. I've diluted juice for myself, usually about half and half, and have been pleased with the taste. (I've even done this when serving juice at parties. Shh!) Try different ratios to see what works with your family.

This idea works great with most juices (we've tried prune, cranberry, pomegranate, blueberry, and apple) and makes them not to sweet. This does NOT, however, work for orange juice. At all. (Blech!)

If you still aren't convinced, consider this:

Last week, I was in the store buying a blueberry/pomegranate juice and was considering purchasing the "light" version of the same brand because it contained less sugar. I looked at the nutrition label, and everything seemed to reflect the lower sugar count. Then, something caught my eye.

Where it usually says "100% juice":

It said "50% juice".

Hm. I looked at the ingredients lists. Sure enough, where the 100% juice lists reconstituted vegetable juice and reconstituted fruit juice first and second, the "light" juice lists filtered water. The two bottles were the same size, the same price, but for the "light," one was paying for half a bottle of water! Why not buy the full-flavored option and dilute it yourself at home? That is like getting two bottles (or three) of the "light" stuff for the price of one!

There ya go: a frugal tip inspired by one backed-up little infant.

Thursday, October 28, 2010

"New Found Money" update #6

Whew! Man, has it been a crazy three weeks! (Haven't I said something like this recently? Or did I simply think it?) Just when I thought things were slowing down, the husband got called out of town. (Again.) Thank goodness that's over! (For now.)

Success! I found a few more belongings I no longer want and will put up for sale. Staying true to this experiment, I will not go hog-wild in listing. I've got to remember the point is to see what happens when I casually put up a few things for sale each week. Adhis, remember, calm consistent baby steps...

How are you doing? Are you finding things to trade for an emergency fund? Are you ready to pick the lock of the shackles of debt?

Week October 21st - October 27th

baby sling $9.94
coupons $1.87
Christmas ornaments $6

Sub-total this week: $17.81
Running total: $290.95

Tuesday, October 26, 2010

A Simple Way to Track Holiday Spending

Several years ago, I ran a business doing home parties for a new clothing company. Because of the uniqueness of the product at the time, it wasn't long before I had more clients than I knew how to keep tabs on. Though I was excited about this explosion in my business, I had difficulty keeping my paperwork from becoming one big pile.

After talking with some of the other women in the company, I got an idea that saved my sanity and helped me keep up with the explosive growth. When I received a new client, I immediately created a file for her. Sounds fancy, huh?

The file consisted of a clasp envelope with a sheet of paper affixed to the front with tape. On the sheet, I wrote the client's contact info, a party date, and a checklist of things to do before that date. Later, I added the party's order total, my profit, an order ship date and other information to help me follow-up with customers. Inside the envelope, I kept copies of all orders placed at the party and a sheet that revealed my profit margin in detail. I kept all of these envelopes in a file drawer by order of party dates. Having all of this information in one place completely freed my mind, and I was able to come up with other ways to grow my business! This system was stupidly simple, terribly un-exciting, and incredibly reliable!

What does this have to do with tracking your holiday spending? There are certainly many ways to do it, but the simplest way is usually the best way. This is the easiest way for me.

Grab a clasp envelope:

Stick a piece of paper on the front of it with glue or tape. This will be where you write all of your holiday spending activities. If you will have a large Christmas budget with lots of activity, then use two envelopes. Maybe one for family and one for "everyone else" (acquaintances and co-workers). Or create one for girls and one for boys.

What will you write on that sheet? Here are some things you will want to track.

(click to enlarge)

  • Include to whom or what you will be dedicating part of your money.
  • Break down your total allotment in each of the categories for "planned expenses".
  • Record exactly what happened in your "actual expenses" at the end of each day in which you spend any of that money.
  • Always keep your receipts in the envelope. (This also helps when you need to return something!)
  • It's up to you if you want to write specifically what you bought. If so, you better keep that envelope well-hidden from curious eyes!
  • You may also want to include a column to check off when the gift has been wrapped. (Or where it has been hidden!)
Deciding on a dollar amount and what is most meaningful to your holiday celebration will make your holiday shopping less crazy and much more focused. You will also find yourself having more fun! It is easier to let yourself go in the magic and joy of the season when you aren't feeling the stress of hectic confusion.

You are the steward of your finances; tell your money what to do for you! When you create a simple way for your holiday budget to succeed, you feel a whole lot merrier a whole lot longer.

Monday, October 25, 2010

Ho-ho- OH!

"I tell you these things because of your prayers;
wherefore, treasure up wisdom in your bosoms...
if ye are prepared ye shall not fear."
Doctrine & Covenants 38:30

Did you know Christmas Day is exactly 2 months away from today?

Please, stop screaming. You will wake up my babies.

The average American charges everything during the holidays while mentally keeping tabs and figuring they will pay off the credit card come January. January indeed arrives, but the total on the credit card statement is inevitably higher than the mental tally. Happy New Year.

The surprise balance is usually made up of "ohmygosh, I forgot to include the sugar cookies I made for the neighbors" with some "doh- I forgot about stamps to mail out the cards" punctuated with "shoot, I still have to stuff the stockings."

What are your plans to pay for your Christmas celebrations?

Normally, this is how I recommend budgeting for the holiday: Take the total you will spend for Christmas (foods, decorations, charitable contributions, gifts) and divide it by 12. This way, you will painlessly save for Christmas the whole year long.

$300 ÷ 12 = $25 per month

This would be line item "Christmas Fund" on your budget. The easiest thing is to have it automatically transferred to a savings account specifically dedicated to Christmas. My savings account is called "Holiday Gifts," though sometimes I rename it with the dollar amount I want to save up, for example "Christmas300." The name reminds me that when I reach the balance of $300 I can reroute the automatic deposits elsewhere.

A few weeks ago, I was asked "What about if I'm just starting to budget for it? There are only 2 months left until Christmas." There are several options available (none of them being "put it on the credit card"), but the following is my favorite.

How about you decide how much you will spend for Christmas this year rather than letting your shopping list decide how much Christmas will cost?

Think on that for a bit.

If you can only set aside $150 total for Christmas in these two short months, then, work with $150. No big deal. Be honest with whomever must know. Simply tell your family "this is what we're working with this year." Next year, you can begin saving for Christmas starting in January.

How do you make Christmas work on $150 or whatever number you have? Much like the basic budget, you set your priorities.

First, what are Christmas "essentials" to you? For some people it's gifts for the family. For other people, it's throwing a party. For others, it's traveling to see relatives. For others, it's doing Sub4Santa. What is it for you? Maybe it's a live Christmas tree. Write it down. And, no, everything cannot be an "essential."

Second, what is last on your holiday priority list? Determine this because you will likely throw it out of your celebrations this year. Is it mailing out holiday cards? Is it the family photo in matching outfits? Gifts for your mail carrier and hairstylist and kids' teachers?

Third, pay for Christmas with CASH, otherwise, you will find yourself mentally rounding down receipt totals and rationalizing your overspending with holiday cheer.

Fourth, keep a record of your spending. A big clasp envelope where you can write on the outside and stash receipts inside works well.

If your budget this year is a lot lower than last year, you will be thinking and working creatively. If you feel you are not creative, then think logically. Ask friends for ideas. Give service instead of goods. Google "creative christmas gifts" or "gifts on a budget" or "homemade gifts" or whatever combination of search words fits your personality. You know the drill.

1. Choose how much money you will use for Christmas. These are your parameters to work within.
2. Decide what aspect of Christmas is most important to you (and your family). This sets your values.
3. Decide what aspect of Christmas is least important to you (and your family). This clears out distractions.
4. Pay with cash. This is your silent accountability partner.
5. Keep a record. This is your accountant.
6. Get creative. This will help create your plan.

How smart of you to get prepared for Christmas in advance! But, please, abstain from playing the Christmas tunes until after Thanksgiving.

Thursday, October 21, 2010

"New Found Money" update #5

My friend was nice enough to let me throw some of my stuff in her yard sale, but due to a meeting and my produce co-op pick-up time being changed, I was hardly at the yard sale to help (wo)man it! She was so gracious and collected money for my stuff while I was gone. Thanks, Carrie!

Alright, people. I am getting a little nervous about this challenge. I am running out of stuff that I'm ready to let go and people are willing to pay for, and I have FOUR WEEKS left! Sure, I could sell my husband's stuff (ha!) but I'd like to give him the blessing of letting things go. (See how much I love you, sweetie?)

Hm. I may need to get creative.

Week October 14th - October 20th

  • kid's boombox- $25
  • cloth napkins $1.25
  • two bowls $1.25
  • dress $3
  • 2 Christmas outdoor lights timers $8
  • can of oven cleaner $0 (yes, free)

Sub-total this week: $38.50
Running total: $273.14

Friday, October 15, 2010

Frugal Friday: Fruit Flip-Flop

(If ever you roll an 'F' in Scattegories and the category is "blog post titles", you have my permission to score some awesome points using the title above!)

Don't you hate it when you buy strawberries only to find three days later they are mushy or covered in mold? It's almost like you buy them just to give your kitchen trash can a treat.

To dramatically extend the life of your fresh berries, try this:

Turn the package upside-down.

When you bring berries home from the store, check that there are no spoiled fruits in the package. (Remember to also WAIT on washing your berries until right before using them to keep them fresh and unbruised.) Then, put the package upside-down in your fridge crisper. This allows the berries that have been on the bottom of the bunch to breathe and resist spoilage and mold growth.

Each day, when you use some of the berries, put the package back into the fridge in the OPPOSITE direction it was in when you pulled it out. This keeps moisture from collecting in one spot and promoting spoilage.

A couple times this past summer, I unexpectedly acquired multiple packages of strawberries and was able to extended their fresh deliciousness one to two weeks doing this simple flip. That's a berry good thing.

Thursday, October 14, 2010

"New Found Money" update #4

Whew! Won't this be quick to add up!

I sold nothing this week. I received some email inquiries about a few items but no serious buyers. It actually worked out great! Between teaching a toddler the wonders of indoor plumbing and finishing up my term on the board of my homeowners' association, I've had a little extra on my delicious platter of responsibilities.

One of my neighbors is holding a yard sale this weekend, and I may throw in some of my stuff just to unload it quicker. Here's to a beautiful Saturday with the right visitors!

What would you feel if you had no visible result during your work to build a savings account or pay down debt? Would it slow down your enthusiasm? Would it pep it up?

Week October 7th - October 13th

* nothing

Sub-total this week: $0
Running total: $234.64

Monday, October 11, 2010


I've been thinking about why I am coming across so "sterile" in this blog compared to my personal blog.

I am not LDS enough.

That's not true, but that was the feeling I found when I peeled the onion layers. I am WAY LDS, but I do not conduct myself as the typical LDS woman, and I was trying to conform to the idea of what someone else thought "LDS" means in case a stranger found this blog by accident. I didn't do this filtering consciously, but that's what I discovered at the core when talking with my husband the other night.

On some subconscious level, I imagined a sweet little older lady taking a break from family history research, coming to this blog to be uplifted, reading my stuff, and then exclaiming aloud into the quiet potpourried air of her little home office decked out in Thomas Kincade paintings "THIS woman is LDS??" Then, in shock, placing her little wrinkled hand on her chest, calling Harold in from the other room. (Bishop Harold, that is.)

So, yeah.

I have lots of personal finance information in this brain, and I am hating that I have for the most part been posting it on this blog like a poorly-edited textbook. Talking one-on-one about your finances and asking questions to help you find your own answer is my preferred method. Obviously, a blog is not the best forum for that, so I will do better to share more real-life experiences.

I am a Latter-day Saint and a very committed one at that. Know though that while I accept a journey of refinement and smoothing out of rough edges, God sent me to Earth in this personality: foot-in-mouth, jabber-y, imperfect, and lovely.

You have been warned.

Friday, October 8, 2010

Frugal Friday: Jack-no-lantern

I love Autumn! And I love Halloween!

By the look of things in my neighborhood, I'm not the only one. Lots of people have decorated already and have their pumpkins carved.

Sure, right now those orange orbs may look like this:

But Halloween being more than 3 weeks away means trick-or-treaters will be greeted by this:

(Or by something worse that I can't bring myself to post images of.)

Let's learn from this:

If you're excited to get your Jack-o-lantern a-spookin', try this:

And do this:

Or this:

You can have Jack gracing your front step without the rot. Then, the week before Halloween, carve out the black pattern. You'll get longer use from your pumpkin without triggering your visitors' gag reflexes!

Thursday, October 7, 2010

"New Found Money" update #3

This past week, I listed on eBay some of the things that had not yet sold on any of the free classified services. Man, how things have changed since I used to sell there for work! The fees are outrageous! My auctions ended, and I had $71 in my PayPal account. After shipping and eBay fees, I ended up with $32.50. Huh???

Granted, I did make a mistake on two of my auctions. On one, I forgot to add handling cost to my shipping price, so all of the shipping & handling allotment went straight to a shipping label. On another item, I started the auction too low. The marble cutting board is a sought-after item for collectors, however, I forgot to take into account that a lot of the items from the same maker only had one or two bidders. There was no competition for my one bidder, and she got a smokin' deal as I later found out that my cutting board contained a unique feature that would have made it worth around $200!

Well, life is the great university, isn't it?

Week September 30th - October 6th

  • baby formula $5
  • marble cutting board $13.09 (after fees)
  • baby supplies coupons 1.34 (after fees)
  • collective figurines $7.79 (after fees)
  • candle lanterns $10.28 (after fees)

Can you believe those numbers came to a clean total? How it tickles my calculator fancy!

Sub-total this week: $37.50
Running total: $234.64

Wednesday, October 6, 2010

Refi Teasers, part 3 & Review

(Hopefully, my experience will give you some ideas when doing your own mortgage refinance.)

Though Lender 2 was offering a higher interest rate, the true closing costs were $1250 cheaper.

In addition, I had just figured out using online calculators, that Lender 1's loan would only give us a monthly payment that was $20 less than Lender 2's loan. Weird, huh? I mentioned this to Lender 1, and he was surprised when his calculations confirmed my findings.

"Yeah, Adhis, but $20 is $20!"

Was it worth paying an extra $1250 up front to pay $20 less a month?

$1250 ÷ $20 per month = 62.50 months

62.50 ÷ 12 months = 5.2 years

If I took the 3.75% loan, it would take just over 5 years for the $20 monthly "savings" to make up for the difference in closing costs. Only THEN, could I get the warm fuzzy about saving $20 a month compared to the 4% loan. What was the likelihood I would be in the house another 5 years? Not very high. We'd basically be paying an extra $1250 now just to have bragging rights to a 3.75% interest rate.

Turned out even if I stayed in the house another 15 years making minimum payments, the 3.75% loan would only save me $2400 in the long run. It didn't seem worth all that extra payment in the front to possibly stay in the house that long and get such a negligible saving (not even taking into consideration the even smaller savings difference if we paid off our mortgage early).

Another way to decide if refinancing is a good idea is to find the "break even point."

Let's say you were faced with the scenario Lender 1 provides, a 3.75% loan that would save you $220 a month. Divide the closing cost by 220.

$4141.30 ÷ 220 = 18.8 months is the "break even point"

That's how long it would take to recoup your closing cost investment. Will you live in the house that long?

Or say you are considering a situation like we had with Lender 2. Divide the closing cost by 200.

$2891.85 ÷ 200 = 14.5 months is the "break even point"

During the refi process, we found out the worst case scenario for the appraisal was we possibly would have to pay PMI of $67 a month (for us) for two years before we could have our home re-assessed. That would still leave us with payments $133 cheaper per month than our original loan. Why had we stressed out so much about the appraisal??? Knowledge sure saves on unnecessary stress!

Guess what? Our appraisal came in EXACTLY where we needed it to come! Exactly. PMI became a non-issue.

We chose Lender 2 with the 4% rate, which also let us find our own title company, saving us another $300 off the closing costs. Ch-ching!

In the end, we saved just over $200 a month in mortgage payments with a break-even point of 13 months! Ms. Cautious' underwriters even ended up getting us money back at closing equaling more than two months' worth of principal. Silly underwriters! We put that money right back toward the principal.

--- --- --- --- --- --- --- ---

  1. Call around for quotes on interest rates and closing costs.
  2. Choose 2 or 3 lenders to compare in detail.
  3. Ask for Good Faith Estimates to be sent to you. (By law, these must be as accurate an estimate as possible on your loan costs.)
  4. Adjust the estimates to reflect similar number of days in the "Daily Interest Charges" line to truly be able to compare the lenders' offerings.
  5. Make sure the Good Faith Estimates are comparing the same things. (In my case, only one had an escrow estimate, the other had $0 in place. I made both estimates "quote" zero, so I could compare apples to apples.)
  6. Take the amount of money your new payment will save you each month, divide the closing costs by that number to get your break-even point. The shorter the break-even point, the better.

What other tips would you suggest?

Tuesday, October 5, 2010

Refi Teasers, part 2

(Hopefully, my experience will give you some ideas when doing your own mortgage refinance.)

After my initial collection of refi quotes, Lender 1 sounded like the best deal. After all, it quoted the lower interest rate.

But the quoted closing cost from Lender 2 sounded like a huge difference.

I requested Good Faith Estimates from both lenders to get a more accurate idea of closing costs. At first glance, things looked like this:

WOAH! Both of them had higher closing costs than they quoted on the phone, especially Lender 2! Lender 1 suddenly had the lower closing cost when Good Faith Estimates came into play. But something kept nagging at me to take a closer look. I remembered the contrast in tones and language used by both lenders' reps.

Lender 1's rep was confident our home would appraise high even though he had not yet researched our neighborhood values. Also, he was using a lot of words and tones I recognized from having been in sales most of my adult life. I felt he was selling to me instead of serving me.

Lender 2's rep was annoyingly overcautious. She said things like "well, I will overestimate costs just in case" and "let's say it doesn't appraise high enough." She said nothing that made me feel the appraisal was a slam dunk.

I decided to look closer at the two estimates. Right away I noticed one of the biggest differences in cost was in the line item "daily interest charges". Lender 1, Mr. Confident, had quoted me daily interest charges of 17 days. Lender 2, Ms. Cautious quoted me at 30 days, the most amount of interest we'd have to pay if we closed late in the month. I adjusted the two so they would quote for the same amount of time, 17 days.

I then noticed that Lender 1 had assumed I would pay my own escrow (only allowed if my house appraised 20% or higher than the loan balance) making his quote for escrow charges $0. Lender 2 assumed they'd handle my escrow (in case our house did not appraise high enough) and had a line item of $1304. I removed the escrow item off her estimates. After these adjustments, the chart looked like this:

Now, that was comparing apples to apples! See what a difference that made in estimating true closing costs? The interest rate started to look less and less important in the short term. What about in the long term?

Monday, October 4, 2010

Refi Teasers

(Hopefully, my experience will give you some ideas when doing your own mortgage refinance.)

AGH! If you hadn't heard, I was driving myself CRAZY a couple months ago with the idea of refinancing our home. My brain would at night disallow sleep due to all the math formulas dancing around. The process has since been completed, my brain has rested, and I can now talk about it.

About a year ago, I set the Rate Watch program on my credit union's mortgage webpage for 4.25%. It would tell me if rates ever dropped that low. I, of course, never thought they would; I was just playing around. This past spring, we got a call from our credit union informing us that 15-year mortgage rates were indeed at 4.25%, sending David and me immediately into a should-we-could-we tailspin. We soon found the catch with low interest rates: they usually mean that house prices are also low. Great if you are buying a house. Not so great if you are trying to refinance a house that already has a mortgage on it.

The new home appraisal would need to come in at 20% over our mortgage balance in order to avoid additional charges. Six years ago, we built this house for $174K. Two years ago, our home was valued around $250K. Of course, we thought getting a high enough appraisal would be easy-peasy.

At the suggestion of the credit union's mortgage rep, I took a look on the MLS to get an idea of the going price for homes in our neighborhood. To say I was shocked would not cover the lengthy speechlessness that followed my discovery. (If you know me in person, you know already I'm not a speechless kind of girl.) All listings in our community were around $200K. And there were a handful of shortsales listed in the 180's. (Yikes!) Our mortgage balance was low enough that we would qualify for the refi, but if our house did not appraise for enough, we'd have to pay private mortgage insurance (PMI).

A few calculations revealed that at our current balance, the appraisal had a 50/50 chance of coming in as enough. The only sure way to know was to do an actual appraisal, costing us about $400. The final decision maker for us was being quoted closing costs of $3,600. Thanks, but no thanks. We put the refi idea to rest. Or so we thought.

Three weeks after our decision, rates dipped another eighth to 4.125%! The temptation was too much. I reset the Rate Watch on my credit union's web page to the pipe dream of 3.75%, so it wouldn't bug me anymore. Or so I thought.

Imagine my surprise in the summer when I received an email notification that rates dropped to 3.75%! WHAT THE FRIJOLE??

OK- whether or not we got the desired appraisal, that was a smoking deal worth going for. We called our credit union. They told us that not only were closing costs now $3700, but that we could not take advantage of the deal because we had locked in an old rate with them during our indecision earlier in the spring. We had to wait 61 days from the date the lock expired. I was so ticked because the mortgage lender never informed us of that stipulation. I went so far as to talk to one of the vice presidents of the credit union who apologetically confirmed this situation.

I called around the county and found a lender willing to match the 3.75% and another willing to go 4% that had a much lower closing cost.

Which one did we choose?

Friday, October 1, 2010

Frugal Friday: Click for Coupons

I am not a Coupon Queen. I do not have the time for the part-time job that it is. But here is one of the ways I take advantage of coupons for items I use.

The last thing I do before I leave for the store to grocery shop is log online and print out coupons for the things on my shopping list.

First, I check because some manufacturers just outright make their coupons available here. (Make sure the zip code on the upper left corner of the page is the one for your area.)

Second, I go directly to manufacturers' websites. For example, we eat whole grain pasta. I google Ronzoni, which is the brand we tend to buy. This helps me find the official Ronzoni website. Once there, I click on "Promotions and Coupons." Wallah!

Sometimes, websites do not make it obvious they have coupons. The benefit of using Google, even when you are pretty sure of the company's web address, is that the search results page will often either show you a direct link for coupons, or it will include in the results some other blog or site that includes links to a relevant coupon.

Some companies do not offer printable coupons at all.

There are other websites and blogs that collect coupon links, but today's tip is a good way to get you started on easy, hassle-free couponing that only takes a few minutes. You can decide how much more involved you want to get in the online coupon world from here.

When you find a page with coupons for products you regularly purchase, BOOKMARK IT. Some manufacturers will only let you print out one or two coupons a month for certain products, and others will say you have reached the print limit, period. Keep the pages bookmarked anyhow because many companies do not tell you they will let you print another coupon after a certain amount of time has passed (a month or three months). Create a bookmark folder labeled "coupons".

The next time you go shopping, open up the folder and all your coupon links are ready to be checked and printed!