2017 in Review

On the last day of the year, I love to sit down and think about everything that's happened.  It gives me a sense of accomplishment that my time and energies were well spent.  It also helps to give me a sense of where I'm going.

In some ways, it feels a little odd to "let it all hang out" there and literally publish what I've accomplished and in some cases failed to accomplish, but I do think it's important.  It keeps me honest, and also is meant to give my readership a sense of what can be done, but also that I'm human, and occasionally miss the mark.

So, without further delay, here is what I set out to do, and what got accomplished in my world this year.  Side Note:  I am also a teacher so you will see that many of my goals are structured around the school calendar.  I frequently set things that I want to do by June (when school lets out), and readjust goals around September (when school starts back up).

Debt:
In 2017, I paid off my private student loan debt.  The balance was just under $10,000 on January 1st of 2017.  My goal was to pay it off by the end of June, and I accomplished that on time.

I have continued to be free of credit card debt and maintained paying my federal student loans on time.  This being said, I have not made extra payments in order to reduce the principal of the federal loans but rather been paying the scheduled amount.

When September came, I originally wanted to start rapidly paying down the federal student loan with the highest interest rate but was detoured from that goal when another opportunity presented itself.  In August, I saw that my credit union was running a mortgage special that included refinances for a very inexpensive fee.  So, I took advantage of it, saving myself about $100,000 over the life of the loan.

Rental Property:
My partner and I took advantage of a mortgage refinance.  This detoured us from our original plan, but we both feel that it was worth it.  It cost us some "right now" savings in favor of a much larger savings over the life of the loan.  We had been paying on a 30 year fixed and refinanced into a 15 year fixed.  We were able to reduce the rate and the term of the loan.  We are paying more than the required amount and will have it paid off in 12 years or less.  I will still be in my 40's.  That feels really good.

This summer, while we were doing the refinance, we also took care of the siding on the house and repainted it.  Not only did we increase the property's value, but additionally, made it a more appealing rental that could be rented for a higher monthly rate in the future.  We paid for this project in cash.

Saving:
I had set a goal for my Freedom Fund at the beginning of the school year (last fall) and hoped to reach it by June of 2017 using only funds from my side gigs.  By the end of June, I had reached 120% of that savings goal.

My partner and I had created a separate savings goal from September until now, but were unable to reach that goal.  Instead, we used the funds that otherwise would have been saved for our refinance.

I increased my retirement savings by 12%, and my partner increased hers by 5%.  This is in addition to the contributions we already made to our IRAs.  We have contributed to our workplace retirement accounts and our IRAs, but haven't maxed any of them out.

Others:
We traveled domestically to Oregon, North Dakota, and Indiana for family functions.  We also traveled abroad to Sweden and Iceland.  We paid for these trips in full (we don't care over balances on credit cards).

We successfully implemented a 30-day DeClutter Challenge this year, and just bought a new dresser to further aid in our endeavor to declutter.

My partner finished 3/4 of her graduate program.

In total, over 40% of my income this year went to saving, investing, and/or paying off our debts!  I am super pleased with that number.

When I look at this list, I think "No wonder I'm tired."  There were a couple of goals (savings and debt repayment) that we didn't quite hit, but we also took care of a couple of unexpected things that we are super pleased with.  All in all, we really made every dollar work for us.  That is always my goal.

Dear Holiday Gift Giver

Dear Holiday Gift Giver,

Thank you so much for thinking of me.  The fact that you care about me enough to endure stressful lines in stores and at the post office tells me that you really want me to know that I'm on your mind.  You want me to know that you love me.

I already know.

Now I have a gift for you.  I would like to release you from this obligation, this burden, this stress.  My gift to you is to tell you that I already know that you love me.  In fact, the best gift you could ever give me is to let me know that you are taking care of something incredibly precious to me:  you.  This isn't the kind of thing you find in a store.  You can't wrap it, box it, ship it.  I won't find it under a tree.  I won't open it Christmas morning.  In fact, if I do find something under a tree, wrapped, and see it's from you, the image of you struggling with bills this or next month might rob me of the joy this gift was intended to bring.

So, if there's a balance on your credit card, or you have student loan debt, or any other kind of debt, then here is what I want from you.  I want you to take whatever money you planned to spend on me, and apply it to that debt.  As you press the button to confirm your extra payment, perhaps you could say a little "Happy Holidays" under your breath in my honor.  As someone I've kept in my life for some time now, I love you enough to want you to give me the gift of seeing you one step closer to your own financial freedom.  There's nothing you could place in a box for me that could ever compete with the joy it would bring me to know that you are taking care of something I love: you.

In addition, I have one more gift for you.  If there is anything I've ever given you, I release you of the obligation you feel to keep it.  If that object no longer brings you joy, it's okay to let it go.  If you have any doubts about whether or not I am okay with you letting go of something I have given you, just ask me.  Most likely, I will tell you that you should just get rid of it.  If it is somehow sentimental to me, but you no longer want it, perhaps I will accept it back from you.  Either way, I don't ever want possessions to be a burden to you.  If I've given something to you, it was because I wanted to show you that I care.  I would never intentionally give you something that would cause you any negative emotional, spacial, or physical outcome.  I am able to realize that you can throw out the object I've given you without throwing me out.

I know that this correspondence is a bit unusual, but; I hope that you find some relief now that you've been released from some obligations.

Happy Holidays!
From,
Someone You Love

Gifting Myself This Year

Want to know a dirty little secret?  I haven't had a dresser in about five years.  Sounds pretty crazy, right? When we moved from the west coast to the east coast, I let my dresser go in the move.  It wasn't in great shape anymore, and didn't seem worth putting on the truck.

Ever since then, I've been organizing my clothing in a super tiny closet and on some shelving cubes.  While it's been working out just fine, I honestly just can't stand looking at it anymore.  I've been on a decluttering mission for about a year now.  Although I have no plans to get rid of all of my clothing, I have realized that it's about more than simply getting rid of things.  Much like my money, I want my possessions to be simplified, then streamlined and organized.  I really do want everything to have a home, and I am willing to invest the time necessary to achieve that goal.  In my financial life, I absolutely do NOT want to have retirement accounts at five different places, and entirely too many credit cards.  I don't need five different bank accounts either.  The same way I don't need my money all over the place, I don't want to see my possessions all over the place either.  This is another way in which I feel clutter and money are related.

So, for the holidays this year, I am getting myself a gift.  I am buying myself a dresser.  As many of you know, we keep the holidays pretty modest in my household.  We have a PJ exchange,  pair it with a junk food, and a movie marathon.  If we have it in our budget, we also like to purchase at least one thing that will improve our space.  This year will be the year of the dresser.  I'm pretty excited because I know myself, and I will probably decide to get rid of some more clothing in the process of filling the dresser.  That will also improve my space.

I am sure this seems like a strange personal finance post, but I am realizing more and more what true balance is all about.  The more I improve my finances, the more I also want to improve my space and my physical health.  The more harmonious these things are, the better I am for my family, my students, my co-workers, and most importantly my present and future self.  So, if there's one idea that I want to put out there, it's to consider "What do I really want for the holidays?  What can I do/buy that will actually improve my life?"  I personally don't really want anything that won't improve my life.  So this year, we're getting a dresser.

What things do you gift yourself and/or others that will improve their lives?

Clutter & Money

Four years ago, when I officially switched industries and moved across the country I had to do some considerable down-sizing.  I was moving from a 1600 square foot house on the west coast, to a one-bedroom apartment of approximately 500 square feet in New York City.  We really got rid of a ton of stuff, and it wasn't exactly easy.

I'm really big on visualizing the life I want.  I am a firm believer in the Law of Attraction and taking appropriate steps to achieve that which I'm visualizing.  When I close my eyes, I see myself living in a clean place with nice things, though not a lot of them.  What's funny is that there isn't typically much "stuff" that I can see in this vision.  I mean, I'm sure I have stuff, but it all seems to have its place.

When I look around my apartment, it feels worlds apart from my vision.  While I've downsized a tremendous amount, I still have clutter.  While I probably don't have any more clutter than most other people, the clutter I see around me gets in the way of my ability to actually fully enjoy the possessions that I truly love.  This sparks an interesting debate at my house.  While it's by no means an argument, we do have somewhat opposing views on the issue.

My partner's perspective is that while we've been making this apartment work for us, it is entirely too small.  She feels that our space isn't conducive to our lives.  Honestly, she's at least partially right.  You see, our apartment is greatly lacking in the "storage" vain.  There are two tiny, bedroom closets for the entire space.  That's it.  But you see, there is some "stuff" you just need in your life.  Most people have more than one set of sheets, more than one bath towel.  If you have no linen closet, where do they go?  While I could go through plenty more examples of this nature, I'm sure you see the point.

My view on our issue is that we still just have too much stuff.  If we had less of everything, it wouldn't solve all of our storage issues, but it would certainly help.  The truth is that we're both right.  Something as simple as a linen closet would alleviate some problems.  We could also get rid of some more things.

We did a 30-Day DeCluttering Challenge this summer and got rid of lots of things.  We still have some ways to go.  We also don't let things come in without something going back out of our space.  This also helps.

There is a direct relationship between our clutter and our money.   First, and perhaps the simplest is that clutter in your space equals clutter in your mind.  If your mind and space are full of clutter, how can you be your most organized self financially?  Next is the more complicated explanation.  It's the fear of financial insecurity.

Those of you who've read The Effects of Growing Up Poor know my background.  When I was a child, we didn't have money for many extras.  Sometimes we had to wait for the things we needed, and could get them immediately.   When your resources are limited, you hold on to what you have. It makes perfect sense, but also has psychological implications for the future.  Now, I have enough money.  I make a good living, and I can buy the things I need easily.   Regardless of this socioeconomic progress, when I am about to get rid of something, I suddenly get this overwhelming feeling.    The feeling is quickly accompanied by a voice in my head that says things like "What if you need this?  What if you suddenly want it?"  There are so many years of built up experiences telling me that replacing possessions is difficult.  This is a little hard to admit, but if I am perfectly honest, I think I have a deep-seeded fear of not being able to get the things I need.  It's a fear of financial insecurity.  I am genuinely afraid of "not having enough money," and that bleeds over to my possessions.  I don't spend much time talking about fear because I don't care to lend power to fear by giving it my energy, but I think for the case of today's post, it's worth it.  I am working through this fear with a fair amount of success.  I have to remind myself of some things:  I have enough money to replace these items if I actually need it in the future.  If my life isn't improved by having a possession, I can let it go.  I am financial secure now.

Additionally, sometimes, I have guilt about getting rid of things that were "given to me."  I have learned to remind myself:  No one that loves me wants me to keep items that are no longer beneficial to me just because they might have given it to me.  My uncle won't cry because I no longer have the t-shirt he gave me 5 years ago.

I have released myself from the obligation to keep things that don't improve my life.  Debt doesn't improve my life, neither does clutter.  So, that being said, I am clearing them both out of my life.

Have you noticed a relationship between your money and your clutter?  I'd love to hear your experiences and thoughts below.

10 Things To Do With A Bonus

 
Everyone loves getting bonuses at work, right?  Working in education, bonuses don't really apply to me.  So I rarely think about them...  That is until now.  This month I am getting a bit of a bonus as a result of the most recent teacher contract.  This is money that isn't a part of any budget or savings plan I currently have underway.  So, the real question is:  What do I do with this money?  Just thinking about it gets me super excited, and inspires me to create this list.

1.  Pay Off Credit Card Debt

If you have credit card debt, this is a no-brainer.  Your bonus could go a really long way toward paying off some unwanted debt.

2.  Make an Extra Mortgage Payment

Just one extra payment per year will shave thousands off your grand total, and allow you to pay your house of years sooner.  Not a bad plan for money you didn't know was coming.

3.  Contribute to Your Roth IRA

I say, get this surprise money working for you!  If you haven't maxed out your contributions for the year, use that bonus to get yourself just that much closer.  You can contribute $5500 per year if you're under 50.  Let's get that thing maxed out!

4.  Fund Your Emergency Savings

Do you have 6-8 months of your expenses in a savings account yet?  If you still haven't reached that goal, putting your bonus into your emergency savings account will buy you some added security.  Honestly, you really can't put a price on peace of mind.

5.  Fund Your Holiday Savings Account

I only spend money that I actually have for the holidays.  That being said, you could use your bonus to pad your holiday savings account, and enjoy your holiday season minus the stress!  Of course, this move doesn't allow your money to grow or save you a bundle like the others, but I say, if you keep yourself from using a credit card during the holidays, it's a total win.

6.  Fund Your Vacation Account

Listen, I am so guilty of burning the candle at both ends that it's not even funny.  So, every year I take great pleasure in planning a vacation that will allow me to rejuvenate myself.  Much like with holiday spending, I don't pay interest on vacations.  I don't take vacations that I can't afford.  If the money's not there, I'm not going anywhere.  So, fueling the vacation account might just be worthy of your bonus.

7.  Home Organization

It's no secret I've been on a decluttering mission this year, and I still have a way to go.  I really do feel like my belongings, my home, and my systems of organization all have a direct relationship with my finances in a lot of ways.  I'm only going to briefly mention two of them right here.  First, how can we really keep our financial affairs orderly when our living space is a disaster?  Secondly, the more we enjoy our own space, the more satisfied we'll be staying home in order to save money.  So, if there's something you've put off buying that will greatly improve the way your space functions organizationally, maybe it's worth using a little of that bonus money to take care of it.

8.  Home Improvement Project

This is similar to the previous item.  If you've delayed funding a home improvement project, and your bonus could cover it, go for it.  Some home improvement projects could make your home worth more (if you own it).  Even if it doesn't increase your home's value, if it makes your home function significantly better, it might be worth the money.

9.  Buy Some Stock

You obviously want to wait for the price to be right, but if you've been eyeballing some stocks, or looking for an opportunity to get into the market aside from your retirement funds without disrupting your monthly budget, this could be the money to use.

10.  Pay Down Miscellaneous Debt

Maybe you don't have credit card debt, but if you have any other loans laying around, your bonus could help you to pay it down more quickly.  Think:  car loans, student loans, personal loans, etc.

What am I doing with my bonus?  I am putting it into our holiday savings account, which we will use for our annual pajama exchange.  We also plan to buy something to improve our space with our holiday funds.  So, my bonus will hang out in savings for a couple of months, and then it will be used largely to improve our space.

Cutting the Cable Cord!

As time goes on, I find myself more likely to stay in than I am to go out.  Partially, this has to do with the fact that I get up at roughly 5 AM in order to get ready for work.  Staying in also saves me a fair amount of money.  I come home, make dinner, and sit down to watch some "mind candy" on television.  When I first moved into my apartment, I got a great deal on a cable subscription.  Eventually, that went away.  We all know those "great deals" are usually for a limited time only.  When they inevitably go away, suddenly the cable bill skyrockets.

I've been hesitant to pull the plug on our cable package even though we've got a Netflix and Hulu subscription.    I had been feeling like there were gaps that I would really be missing.  For example, we watch the news every morning before going to work, and didn't really care to alter that habit.    We bought an antenna but the results were patchy...

Well, I'm pleased to say that we finally got a divorce from cable, and haven't given up any of the things we love most!  Here's how we did it.

We kept our Netflix subscription the same.  Then we made an amazing discovery.  Hulu is trying out a new service package (a trial run to be exact).  This new package allows you to stream a number of stations in real time.  I was able to get the major stations: ABC, CBS, etc.  Additionally, I was thrilled to discover that I could get some of my favorites including HGTV and Food Network! What's even better is that it only costs me $40 a month!    This is way better than a cable subscription if you ask me!  It's also saving us over $50 a month too!  As far as I'm concerned this is a win-win situation.  We get a lot of the channels we love, and freedom from the cable company!

Have you had success cutting cable?  What was your strategy, and how is it going?

4 things I DON'T spend money on!

I ran into some friends in my neighborhood on my way to running some errands. I was about to head downtown to do my primary grocery shopping at Trader Joe's.  I explained to them that our neighborhood grocery is the one I use to "fill in the gaps."  Being somewhat a health food nut, I do a lot of grocery shopping at Trader Joe's because I get a lot of the "health food" I prefer at a must less expensive price.  Of course, I can't manage to get literally everything I need there, so I usually end up at my neighborhood store for a few items. These friends of mine had just finished doing some grocery shopping, and made a comment they they too use the neighborhood store to "fill in the gaps", but those "gaps" just set them back FIFTY BUCKS!  I nodded my head to commiserate as I  glanced at their shopping bags.  I couldn't help but notice a package of paper towels...  So, without further ado:

4 things I don't spend money on:

1.  Napkins/Paper Towels

These items are expensive to buy at the grocery store so, unless I have to do some massive cleaning that requires these disposables, I don't bother to buy them.  Whenever I buy a coffee out, or order takeout, they give me a zillion napkins (which I don't really need).  I stash them in my bag, and they go into the napkin holder once I get home.  That has kept me with enough napkins to meet my needs for almost as long as I can remember.  Seriously, I think maybe two years ago I bought one roll of paper towels.  Maybe, this sounds super cheap, or cheesy...  Or perhaps you've got kids and need a ton of paper towels, and this won't work for you, but it's working for me..And saving me money.

2.  Expensive Cleaners

Along with being a health food nut, I am also all about natural products where possible.  This definitely bleeds over to the category of "cleaners."  I have plenty of books on natural methods of cleaning and disinfecting things, and have found that what has worked for our grandparents FOREVER still works today for me.  I have spray bottles and such at home with mixtures of things that are cheap, effective, and living in my pantry.  It's amazing what you can do with lemon, vinegar, alcohol, hydrogen peroxide, etc.  In fact, you can make your own laundry detergent (which I did for years, but now I use drop off service since moving to NYC) for much cheaper than what you buy in a store.  I will leave you to your own research, but I am suggesting, you can save a bundle, and keep a very clean house...just like grandma did.

3.  Veggie Stock

You can spend a ton of money on this stuff.  I make my own.  I keep a baggie in my freezer for the ends of veggies that are ready to be discarded.  Once the baggie is full, I boil the veggie ends into stock and freeze it.  My home made stock tastes way better than what is in the store, I know what's in it, and it's much cheaper.  It also doesn't really take me time.  I just let it simmer when I am doing other things at home.

4.  Haircuts for my cat...

If you love your pet groomer, continue on!  Otherwise, I have my own electric clippers.  My partner and I trim our long haired cat ourselves when needed.  We spend plenty of money buying her the healthiest food, and the litter with the least chemicals, but kitty hair cuts?  We've got that one covered!

How about you?  What are some things that other people are paying for that you aren't?  We'd love to hear your tips!