August 2017 Check-in

Everything is chugging along.  The mortgage balance is smaller (we are on track to pay off $60,000 this year).  The 2016 and 2017 Roth IRAs are fully funded and 2018 funds are in the hopper.  Over the past year we’ve taken two week-long vacations and lots of long weekend trips, usually staying with friends and using credit card airline miles.

After our last week-long vacation in June, we decided to try switching to debit cards for a spell.  Again and again, I’ve heard that we spend more with credit cards and let me tell you, it’s absolutely true.  We’ve been putting just enough money in the checking account to cover two weeks at a time.  I hate getting below a $100 balance and so far, it’s only happened once.

Lately I’m struggling internally over whether we should just pay the regular mortgage payment for the next 7.5 years and invest the “surplus” in index funds.  The math makes sense but my heart doesn’t like it.

Black Friday Weekend – What I didn’t Buy

Thanksgiving weekend!  A very short work week followed by tons of food, wine, family and kids.  My husband and I do two Thanksgivings each year.  We do Thursday with his family, which is a lot of people and kids gathered at his mother’s house.  And then we do Friday with my family in Maine, which is much more calm and relaxed.  This year my sister and her husband couldn’t find reasonable flights, and my grandmother didn’t want to leave the assisted living facility, so it was just four people splitting all kinds of awesome food.  My mother’s favorite hobby is to feed us, and then to tell me I’m gaining weight.  Mothers!

I always look forward to Thanksgiving.  I tend to think of myself as “too good” for the Black Friday hubbub, but in practice, I end up spending quite a bit of money Thanksgiving weekend.  Historically we go to Freeport and I drop several hundred dollars at stores like J.Crew Factory and Sperry and Brooks Brothers and Orvis.

This year, I steeled myself.  We didn’t go to Freeport.  I stayed off the J.Crew Factory website.  The only store I “needed” to go to was my friend’s watch store in the Portland Old Port.  My husband’s family does a gift exchange (I don’t participate).  The guideline had been $200 but last year was lowered (thank goodness) to $100.  He drew a sister-in-law, and we wanted to buy her a beautiful gold Skagen watch, as well as pick up the Swiss Army knives I had ordered for my nephews.  It should have been a quick transaction.

But damn if those Hamilton watches aren’t gorgeous.  I was drawn like a

The Bagley Quartz watch - "an American classic."
The Bagley Quartz watch – “an American classic.”

fly to light to a delicate, beautiful watch which I immediately put on my wrist.  I love gold, I love brown leather, and I love watches.  My internal monologue went something like this:

You’ve been so good for the past two years.  You deserve something nice.  You haven’t bought a new watch in more than two years.  This one is so classy and pretty – and high quality!  It’s $645.  That’s a lot.  That’s alot-alot.  That’s hard to justify.  But Nicole – you never buy yourself “anything.”  You work hard.  You should have nice things.  And you can afford it.  It could be your Christmas present!  In a few months, you’ll get that extra $600 from the TD Bank accounts.  Why not use it for this watch?

At that point I had to drag myself away from the watch.  My father was with us, and he wanted a coffee.  We went next door to Bard Coffee, and as soon as I stepped out of that intoxicating watch shop, I started to come to my senses.

A $645 watch is nuts right now.  We owe $240,000 on our mortgage, for God’s sake.  And who knows what kind of unexpected bills will come over the next few months.  We’ve been averaging hundreds of dollars a month in medical bills, and there’s no reason to think those will stop.  Winter is always more expensive; the cars run less efficiently and the house needs to be heated.

Not to mention… I already own several [beautiful, high-quality] watches…

You know what they say - a girl can never have too many watches! Well...
You know what they say – a girl can never have too many watches!

If you look closely, you can see that I haven’t even worn half these watches since daylight savings kicked in nearly a month ago.

Bottom line – much as I love the Hamilton model, I do not need another watch.

My next Black Friday weekend “challenge,” which has been ongoing, was the Allen Edmonds website.  The Allen Edmonds brand first blipped on my radar a few months ago.  My husband told me that he really liked his brother’s shoes, which were Allen Edmonds.  I immediately went to the company’s website, saw the prices, and thought, “ain’t no way in hell my husband is ever gonna wear Allen Edmonds.”

The shoes are gorgeous, and look high quality… and run in the neighborhood of $400.  But for yucks, I submitted my email address into the company’s database.

That was mid-August.  I now receive emails from Allen Edmonds every few days.  I’ve received 59 emails since I signed up.  Allen Edmonds is pretty much always on my mind.

Allen Edmonds – purveyors of gorgeous shoes, and relentless email marketing geniuses.

I’m now familiar with the styles and the rotating sales prices.  So when the Black Friday prices came up, I didn’t question that they were much lower than the usual mid-week “bargain” prices.  All of a sudden, the gorgeous shoes were in the “still-really-expensive-but-sort-of-justifiable” range.

The Sanford cap-toe Derby is HALF OFF for Black Friday!
The Sanford cap-toe Derby is HALF OFF for Black Friday!

The Sanford cap-toe derby in walnut leather, for example.  A gorgeous shoe!  Does my husband already have a brown dress shoe?  Well yes, he does.  But I hate that pair of shoes, and I know they don’t fit him well.  They don’t look nice.  I can order this pair in a size 14B, which is incredible.  These shoes will last a lifetime.

The Long Branch Wingtip Boot in "Golden Brown Chromexcel Leather"
The Long Branch Wingtip Boot in “Golden Brown Chromexcel Leather”yb

OK, OK, so maybe he doesn’t need a brown dress shoe right this minute. But what about a pair of boots for the weekends?  A nice pair of boots!  The Long Branch Wingtips!  Those would look amazing on him.  Zexy.  He doesn’t have anything exactly like this, and it could be his Christmas present.

But again… he just doesn’t need a pair of $300 boots.  I’m not saying he’ll never own a pair of Allen Edmonds shoes.  It just needs to wait until he actually needs a new pair, and then a little longer until the next Black Friday sale.

So no Allen Edmonds shoes.  But maybe something more reasonable.  For me.  I looked at the www.craftsy.com sales – and there are many – but I stayed calm.  I have several craft projects to get through (I quilt) before I can justify buying something new, even at a “bargain.”  Nevertheless, I decided I “needed” a new cutting mat.  The 24″x36″ Olfa mat for $38.40 plus shipping (normal price $64) seemed like a good deal.  My old mat is still doing the trick, but it’s beat, and the fabric seems to be slipping, and my cutting accuracy suffers.

24"x36" Olfa Cutting Mat - a bargain at $38.40.
24″x36″ Olfa Cutting Mat – a bargain at $38.40.

Truthfully, I didn’t really need this mat.  I have one.  The same one.  And it’s older, but it’s fine.  Luckily, but the time I tried to purchase it online this morning, Craftsy was plum outta stock.

See, that’s the thing about people like me.  My husband and I don’t consider ourselves wealthy, we certainly don’t have “F-You” money.  But we do have much, much more than we need.  We both work.  We don’t have kids or the associated expenses.  We can afford to put a couple thousand extra bucks towards the mortgage each month.  So taking some of that money and putting it towards a beautiful watch, it doesn’t really seem like all that big a deal.

The problem with the “Old Me” was that I tended to splurge at all levels.  I would splurge on coffee, sure.  And happy hour.  And restaurants.  And vacations.  And Volkl skis.  And hair salons.  And Crossfit.  And handbags.  Splurging on something specific is one thing, but when you splurge in all areas of your life, you end up rocking 18% credit card interest debt and refinancing again and again to a new 30-year mortgage term.

At 35 years old I realized that while my husband and I were certainly doing OK, we could be doing so much better.  The point wasn’t to buy things.  The point should be for our income to buy us options.

Overall we did well this weekend.  We bought some presents.  We didn’t buy anything expensive and unnecessary just because it was a “deal.”  Best of all, I anticipate that we will stay within the week’s budget.  If I had purchased the things that I wanted, I could have quickly spent more than $1,500.  I would have loved the stuff, but it wouldn’t have been worth the crazy spending hangover, and it would have derailed us for this month and next.  We’re having a good November, budget-wise.  I’m so happy we’re keeping it that way.

 

 

Don’t Buy Underwear at Marshall’s

I went to Marshall’s yesterday to buy underwear.

I walked in.  BOOM, shoe section.  I looked through all of the shoes, but didn’t see anything I “needed.”  But right next door – SWEATERS!  Such a nice looking French Connection sweater, only $29.99.  I love that brand, but don’t buy it because of the price – kismet!  And then another beige sweater by Michael Kors.  $29.99, which would look great with leggings.  I grabbed those and continued on towards the underwear section.

Five steps later I was deep in to the handbag section.  And then I was trying on sheer-ling Ugg gloves, gorgeous, marked down to $79.99.  And then I was considering whether I needed a new mud mask.

I put the Ugg gloves back.  Underwear.  I came here for underwear.

But what’s that?  Gorgeous socks!  Beautiful, patterned, high quality, comfy socks!  Snowflake patterns, SmartWool, I was swooning.  I grabbed three pairs.  At this point I was juggling two sweaters and three pairs of socks, more than $80 of merchandise.  On to the underwear!

But first – pajamas!  I haven’t bought new pajamas in forever and there was such cute Christmas-themed stuff.  And wouldn’t my husband like me better if I wore fuzzy pj pants with candy canes?  No!  Focus, Nicole!

Finally, I got to the underwear.  It took all of thirty seconds to see they didn’t have what I was looking for.  So I turned to leave and landed smack in the middle of… the kitchen section.  The evil, evil kitchen section.

And didn’t they just get a gorgeous shipment of “handpainted, made in Japan” little bowls and food savers-  super cute!  And only $3.99 per bowl and $6.99 per food saver.

I needed this stuff.  I was down several food savers from gifting food in the past few months, and this stuff was gorgeous.  And cheap!  I also scooped up a spoon rest for $2.99.  I already have one, but wouldn’t it be convenient to have two?

At this point, I ditched the sweaters on a rack of dish towels.  And the socks.  I had pulled out four little coordinating bowls and two food savers.  So I was “down” to $30.  That’s not bad, right?

I was already over the sweaters, but at this point I still badly wanted the socks and had my heart set on the bowls and food savers.

Then I started thinking big picture.  Shit from Marshall’s is the kind of stuff that immediately gets absorbed into a home and becomes lost money.  I started to imagine seeing the thirty bucks on my credit card statement a few days down the road and to think hard, what was it that I bought?

Also, my mother just gave me some very nice little bowls.  Why did I think I needed more?

Ugh.  I put it all back and left the store.  I hate Marshall’s.

You Don’t Ever Need to Go in to the Hallmark Store

But what about…

Figurines

AKA dust collectors.  You don’t need these, and your mother and grandmother are real tired of pretending to enjoy receiving them as gifts.

Snow Globes

No one actually likes these.  Only wistful movie characters.

Christmas Ornaments

You have enough.  Also, check out this link.  Would you ever buy a Barbie or Star Trek Christmas ornament online?  No?  Then you shouldn’t buy it in the store, either.

Gift wrap, bags, tissue paper, bows

Buy it on super sale after the holidays at the grocery store.  Before the holidays?  Wrap in brown paper or newsprint, have the kids decorate.

A single ball of Lindt chocolate by the register

75 calories and 55 cents.

“Active Lifestyle” shoes

C’mon now.  No one goes in to the Hallmark store planning to buy orthotic shoes.  It’s hella expensive collateral damage.

Painted Wine Glass

Again, no one actually likes these.  People seem to enjoy purchasing them, but no one wants to drink wine from these monstrosities.  They frequently show up at garage sales covered with dust.

Special card that Sings

These singing cards are annoying AND crazy pricey.  Get a silent card at the grocery store. 

Puzzle of a Kitchen

Ask around – your friends are dying to unload several puzzles.

Fun socks

Ugh. 

Here’s the bottom line: when people try to re-sell stuff from the Hallmark store – be it at a yard sale, or online – no one wants to buy it.  No one.

There’s something alluring and nice about the Hallmark store.  Heck, it even smells nice.  These people know how to market the hell out of a  kneeling figurine of a little girl praying in her nightgown.

But once you get those items out of the store… it’s junk.  You don’t need more junk.  Stay out of the Hallmark store.

TD Bank is Giving Away Money

We keep an “emergency fund” lying around in a savings account.  We decided on $30,000.  We earn pretty much nothing on this money.

TD Bank is currently offering $300 to open a new Premier account, so I went ahead and opened two accounts, one for my husband and one for me.  I transferred $2,500 into each account from our emergency fund and changed our direct deposit for a few paycheck cycles.

Free money courtesy of TD Bank. Why not?
Free money courtesy of TD Bank. Why not?

$300 is 12% of $2,500 – that’s a fabulous guaranteed return on investment.  It sure beats the fraction of 1% that we earn in our normal savings account!

95 days after opening a new premier account – during which time the account balance doesn’t drop below $2,500 and $2,500 is direct deposited — TD Bank will deposit $300 into each account.

Here’s the link to the promotion:

https://www.tdbank.com/personal/premierchecking_inc.html

I’m not sure if we’ll keep either account open past Day 96.  I did visit a TD Bank branch in my neighborhood, and I was impressed by an ATM in the lobby which distributes any dollar amount, in the bills of your choice.  Well… I was impressed by the idea of it.  It was out of order that day.

It’s a good gimmick, this $300 bonus.  I never would have stepped foot in the bank otherwise.  I’m a sucker for free money.

I Cancelled Amazon Prime

The $99 Amazon Prime annual renewal fee came up and I didn’t feel like paying it.

I really like the show “Catastrophe,” but otherwise I don’t think I’ll miss the video portion too terribly.

I think this will cut down on impulse buys. I looked back at our order history over the past year, and most of the orders have been presents.  I don’t mind cutting back on presents a bit.

I’ve always talked about how great Amazon Prime is.  Living without it for at least a while will be the test.

I Want this Bureau Something Fierce

Today I was scrolling through Craig’s List.  Because I’m an idiot.  Just kidding.  I was scrolling through because it’s sort of my hobby to scroll through.  BUT, just because there are awesome deals to be had in every corner or Craig’s List doesn’t mean they are necessarily awesome for me at a particular time.

Case in point.  This week we are ahead on our budget by a few hundred bucks.  So we have a couple hundred bucks to spend, right?  Well, not really.  For one thing, when I log in to the health insurance web site, I can see $140 of bills coming down the pike (the Explanation of Benefits is sitting there, but we haven’t yet received the bill).  Furthermore, we’re getting a quote Wednesday morning for some maintenance that needs to be done to the furnace.  We don’t know what that will cost.

We have a crummy Ikea bureau in our bedroom.  Two drawers can only be opened by the right pull, else the front pops off.  Wouldn’t you know, Craig’s List has a solution that I absolutely love.  An antique.  Gorgeous.  Well-made.  Matches our beautiful bed.  It’s been sitting on Craig’s List for 8 days, and is only 20 minutes from our house, just two towns over.

1930's Drexel Bureau, mine for "only" $600
1930’s Drexel Bureau, mine for “only” $600

Ain’t she a beaut?  The sales post explains that the family is downsizing.  They bought the bureau at a “certified” antique store in Maine in 2012 for $2,800.  They’re”heartbroken” that they have to sell.  They’re asking $600.

At this point I’ve bought a few bureaus from Craig’s List.  This puppy is right up my alley.  It’s in beautiful shape and I love it.  $600 is more than I’m willing to pay.  But $400 – I would love to offer these folks $400.  After 8 days on the market, they’re probably getting a little antsy to sell it.  And there’s no harm in putting in an offer, right?  It’s such a great deal.  Passing it up would be plain dumb.  Right?  It’s arbitrage – their loss is my gain!

Here’s the problem: it’s not in my budget today.  I haven’t been setting aside money for a piece of furniture.  I didn’t anticipate this cost.  Do I have enough money to buy this?  Yup.  But is it a smart choice today?  Nope.  Damnit.

I’m about $250 “ahead” of my budget for the week.  The “week” ends Thursday.  But this “ahead” mindset has gotten me in to trouble before.  Between now and Thursday, I’ll need gas.  I’ll make a quick trip to the grocery store.  We have that furnace appointment Wednesday morning.  I’m not actually “ahead” until I hit the end of the week, you know?

I'm drooling.
I’m drooling.

I want this bureau.  It kills me not to make an offer.  I can justify it in so many ways.  An opportunity like this might not ever come up again!  I might end up paying more for a less perfect bureau down the road!  $400 will not derail our long-term financial goals!  I deserve nice things, I work hard and I hardly ever “treat” myself (not true, actually, but for the sake of arguing with myself, it’s a strong thought, haha).

So why not buy it?  I can “afford” it.

Well, it’s not in the budget this week.  Or this month.  My husband and I talked about what was important to us this month, and “beautiful antique bureau” did not come up.

What did come up?  A new pair of dress shoes for my husband.  He’s worn the same pair to work each day for 5 years, and had them re-soled twice.  He thought it was time for a new pair.  $185.

What else?  The furnace.  We know there’s an issue, and we need heat.  So we’ll get it fixed.  Not sure how much that will be.  It’s such an un-sexy way to spend money… but sexier than a mid-winter problem, that’s for sure.

The property taxes.  We got the quarterly bill two weeks ago.  It wasn’t due for a month and a half, but we figured we’d go ahead and pay it so that we weren’t dealing with it December 1st.  That was $1,019.

Some plants for the backyard.  We bought a few plants marked down for the end of the season last weekend (“no guarantee” the salesman helpfully repeated a few times).  We’ve got an uggo back fence situation that I’d like to camouflage.  End-of-season plant discounts are a couple magnitudes less expensive than a new fence.  That “took care” of another $130.

And Salem.  Every October we go to Salem.  So yesterday we spent the day with a nephew walking around and window shopping.  Gas, Dunkin Donuts, burgers for lunch – another $50.

Even though I want a new bureau in general, I didn’t want it enough at the beginning of the month to figure out a way to work it into our budget.  So that means – no bureau 🙁  I don’t want to be making $400 impulse buys.

I think that’s the trouble – we want it in general, we happen across an amazing “deal,” and we justify a purchase to ourselves, but not to our bank accounts.  That’s the wrong way to go about things.

If something is important enough to justify a purchase, make that decision ahead of time.  Determine what you want to spend.  Then set aside the money, over whatever course of time.  Then find something that fits the budget you’ve ear marked for that purchase.  Too often, I get the order of operations mixed up, and it bites me in the end.

The other big trick is to stay off Craig’s List when I don’t have a Craig’s List budget set aside.

So long, beautiful bureau – we hardly knew ye.

<sigh>

 

Total Wastes of Money

The soda stream The break-even point on an $84 soda stream is a lot of frigging soda water.  Another amazing marketing success story!

The Apple Smart Watch Not only are they ugly and expensive, every single person I’ve ever seen wearing one has an iPhone not more than a few inches away.  Talk about redundancy.  Again, marketing – Apple has convinced these people they “need” the watch.

Vitamins.  Except folic acid for the ladies.  Another marketing coup.  Just eat a balanced diet.

Pet clothing.  I’ve bought my fair share of pet clothes before.  What a crazy-stupid thing to buy.  Dogs have hair to keep them warm.

Dyson hair dryer.  A hair dryer for $700 is a thing all because of the dulcet tones of some British dude.

Fit Bit.  Your Fit Bit is stupid.  If you must obsess over yourself, use free  SmartPhone apps.

Roomba.  No one needs to pay $500 for a vacuum.

Diamond rings.  Diamonds are all marketing, ladies.  There is a glut of diamonds, which is carefully controlled by the diamond cartels in order to artificially inflate the price.  Spending $15,000 on a diamond is no kind of insurance policy for a marriage.  Being nice to each other is a much higher level of security, and it is free.

Platinum wedding bands.  Some of the men don’t like to be left out of the wedding spending frenzy, and they feel that because the man’s band is so much less money than the lady’s ring(s), it’s not such a big deal.  Well platinum dulls like crazy, and scratches, and generally looks plain awful after a few months.  I don’t understand why jewelers are so quick to tell you that it is the only metal that doesn’t “lose weight.”  It looks like shit.  Platinum is more marketing genius.  My husband’s wedding band was $20, from Amazon.  4.5-star rated by 335 smart customers.  He gets compliments on it all the time.  It doesn’t make him love me any less.

Books.  Go to the library!

 

 

Redefining “Worth It”

My friends and coworkers love to talk about how certain things are and aren’t “worth it.”

This phrase always makes me roll my eyes.  It’s typically used as a justification to spend more money.

It’s fine to spend more money on things you’ve decided are important.  However, there’s a second part of the equation; not everything can be important!  If you want to spend more on one thing, you consequently need to spend less on a different thing.  Or nothing at all.

Here’s a friend’s recent facebook post:

Wants vs Needs - the twix don't always twain. Or something...
Wants vs Needs – the twix don’t always twain. Or something…

This post generated 36 comments, plus ample sub-comment discussion.  TONS of well-meaning suggestions.  Everything from, “eat less meat” to “raise your own chickens and start a vegetable garden” to “buy a percentage of a cow and a chest freezer” to “eat more chicken thighs and less expensive cuts” to “I saw some folks on TV get 100% of her food from the grocery store dumpster for free” (ok, ok, that was one of my suggestions).

The poster – a lovely woman! – went on to explain that her family’s diet is strictly paleo.  Cutting down on meat was not an option she was willing to consider.  She also nixed dumpster diving.  Snob!

So herein lies the problem:  my girlfriend has declared that an expensive, meat-based diet, made even more expensive with organic, grass-fed ingredients, is “worth it” to her.  It is a priority.  That’s all well and good so long as she can afford it by cutting costs in different areas.  If she can’t afford it, and stick to her family’s budget, it’s no longer “worth it.”  It’s nuts!

Through this post, she’s trying to figure out how to have her cake and eat it too.  It’s like saying, “I only fly first class, and drive luxury cars, and live in a mansion, and eat at the best restaurants” and then complaining that you’re having trouble affording first class.

We can’t declare every single thing we want “worth it.”  It doesn’t work.

Scrolling back through the comments on this post – Costco!  meal planning!  boxed wine!  home-made cleaning supplies! – it strikes me that not one person suggested cutting back in a different area of the family’s spending to accommodate their diet preferences.

I have another girlfriend who gets her hair cut and colored every 8 weeks to the tune of $250 (including tip).  She was unemployed and living off her 401(k) for nearly a year (frankly, this was a choice – there was plenty of temporary, seasonal, and part-time work she could have picked up, had she wanted it).    When she moaned about depleting her 401(k) and I suggested she cut out the salon visits, she was horrified.  Her hair was “worth it.”

Another friend is looking for a way to cut back generally on spending.  I suggested he start bringing lunch to work.  He explained to me that bringing his lunches would only save him a few thousand dollars a year.  He needed to start saving much larger amounts.  The hassle of a brown bag lunch just wasn’t “worth it.”

I think the problem is that my friend group is a high-earning, professionally successful bunch.  We get married later, buy homes later, have kids later – and for a period of several years in our 20’s, we got used to “having it all.”  I certainly got used to it!  I had a great income for a single person with very few expenses.  If I wanted something, I bought it!

But then as I got older, and started planning for the future, and added a mortgage and health costs, and home expenses to the mix, I had to redefine what was “worth it.”

Now when I say things are “worth it,” there’s a new meaning.  Usually I’m justifying that things are worth a sacrifice.  Sometimes a big sacrifice, sometimes one that is hardly noticeable.

Our family’s $30/month Republic Wireless bill; is it an iPhone?  Nope!  But the plan is “worth it” to me.  Socking money away for retirement – worth it!  Trading in cable for Hulu – worth it!  Brown bag lunches – worth it!  $65 hotel rooms on vacation – worth it!

Small adjustments in day-to-day, week-to-week, and month-to-month behaviors which facilitate the Big Picture goals – worth it.