July Recap

July was a good month overall, because we had so much extra income coming in, but we also fell way short of our goals. 

I had hoped to finish out the month with $8000 in savings ($2000 for tuition, and $1000 for the upcoming home repair). The actual amount is only $7,615.75. 

We owe about $400 more on the credit cards than I'd planned on, pretty much all from the last-minute vacation. I had projected that the outstanding balance would be $25,600 and the actual amount is $26,028.49. 

Selling stuff

I listed some old textbooks (from last semester) for sale online several months ago, and only one sold right away. The other two listings actually expired after 60 days, and I had to relist them for sale. Both books sold this week, probably students trying to get good deals on textbooks for the upcoming fall term. One was $35, the other was only $15 - but hey, after shipping that's still an extra $40! 

I have a few other books laying around, and a few household items that we no longer need, so I think I'm going to spend a couple of hours this weekend listing those items on Amazon and Craigslist... hopefully I'll be able to make another $60 or so! 

Anniversary Gifts

I've been pondering over anniversary gift ideas for awhile now, and debating whether I should buy anything at all. We did just take a short trip, and we bought a few souvenirs for my husband (and I think he'd be happy counting those as an anniversary gift). 

But I do want him to do something special for me, and I'd feel too selfish if I expected that of him but didn't do something in return. He's hinted at a few things he'd like, but they're all in the $100-400 range, which is way more than I want to spend. I'd love to buy him the things that he really wants, but I'd much rather be that much closer to having the credit card debts paid off.

One of the items he's mentioned is a new wedding band. The one he wants retails for around $300 at the local jewelry stores, and is online for $100. I searched on eBay and found one that looks identical for only $25. Now that's definitely in my price range! 

The listing said that it's brand new, and that the metals are genuine. I'm a little dubious, because it seems too good to be true, but I know jewelry tends to be marked up quite heavily, so I guess it's possible. I'm just hoping that it arrives soon, and that it is what the listing claimed. I don't think I'll tell hubby how much I paid for it though! 

Grocery Shopping

I recently discovered that a few Kroger stores in the area double coupons up to $1 (most other Kroger's only double coupons up to 50 cents!), so I went there yesterday to see how well I could do. I don't usually like doing my "full" shopping at Kroger, because they do tend to be more expensive than several other local grocery stores, but I had a ton of $.75 and $1 coupons...  

Thanks to a large stack of coupons, many of which were going to expire soon anyways, I scored tons of free & really cheap stuff. The freebies included yogurt, toothpaste, air freshener, deodorant, pet snacks, and candy. I think I'm going to have to make a more conscious effort to set aside those $1 coupons, and then head up to Kroger every week or two!  

Vacation

I had optimistically budgeted only $300 for our mini-vacation. $100 for travel, $150 for food, and $50 for souvenirs and miscellaneous expenses. We definitely went over-budget, and ended up spending $450. 

A significant portion of the driving was on toll roads, at a cost of $25 each way. I had realized that there would be some tolls, but I definitely underestimated how much it would be. Pennsylvania is really expensive! 

We also ended up spending far more on souvenirs & miscellaneous things than originally planned. We spent $40 on books for the trip before we even left, and we spent about $120 while there. 

The only thing that we stayed on or under budget was food, and that's mostly because someone else picked up dinner one night, and we skipped lunch another day. 

Gas Bill

I logged in to check my email this morning, and found the monthly email from our gas company saying that our bill is now available (most of our bills & utilities have online accounts/e-pay, so we use that to cut down on paper waste and to save on postage). Our summer gas bill runs around $50/mo, with the absolute lowest being around $35 if we're really cutting back on showers & laundry.

July's gas bill: $16.86

At first I thought that perhaps they had estimated our usage for the month and managed to screw something up (we've had several problems with both the electric and gas companies doing that in the past, and then we end up with a bill that is $100-200 more than usual when the actual vs. estimated readings catch up). Turns out that they had estimated our bill last month, and they must have over-estimated our usage - so I'm thrilled.

It's only $35 saved, but after yesterday's realization that we're somehow $850 behind for the month, every little bit helps!

Property Values

We bought our current house at near the peak of housing prices. We settled on a purchase price around $180k, and felt that we had an ok deal. We made the mistake of getting too attached (and desperate to settle, after being unable to find something that met all our criteria but was still in our price range!), so we felt that we had overpaid slightly, but we made that tradeoff when we placed our final offer. 

Three years later, our house is valued somewhere around $145k, a drop of $35k (almost -20%). It means that we're upside-down on our mortgage, and we're pretty much locked in to a house that we can't afford to sell. We'd love to "move up" into a bigger nicer home, but we wouldn't be able to come up with the difference on what we owe, much less a down payment on the new house. So we're stuck where we are, and we're trying to make the best of it. 

Although the entire state has suffered some pretty significant drops in property values, I knew that where we live hasn't been hit as badly as others. For curiosity's sake, I decided to check and see how it's affected property values of some of our friends and family who live nearby. 

One couple we know paid $140k in 2003, and their house is now worth $120k (-14%).  Another couple paid $95k in 2004, and their house is now worth $45k (-47%). And yet another paid $265k in 2005, and their house is now worth $215k (-19%). 

It definitely sucks that values have dropped so much, but it's oddly reassuring to know that so many people we know are in the same situation. We've lost a lot of money on this house (if we were to sell it now), and especially if we include the money that we've put into repairs & improvements (not even talking about mortgage interest and property taxes!), but it could be worse. I'm sure that we'll end up taking a loss when we move (because we don't plan to stay put for more than a few years), but hopefully we will get enough to at least pay off our mortgage when we do finally sell. 

Mid-Month Budget Status: $850 short

I had projected that we would pay down the credit cards down by about $6200, and beef up the savings to $8000 (adding roughly $3000 to cover upcoming short-term expenses, while keeping the rest for an emergency fund). 

According to my current projects, the actual debt repaid during the month of July will be $5575, over $600 less than originally expected. I also won't be able to reach my goal of $3000 extra in savings, it'll end up being closer to $2750. 

With the extra paycheck and self-employment money, July is still a great month financially, and we'll make a huge dent. It's just frustrating that, only two weeks into the month, we're already $850 short of where I thought we would be. And I can't account for it all...!  

Auto expenses, $60. 

Textbooks, $80. 

Medical copays, $60.

Entertainment (4th of July), $75. 

Lunches at work, $40. 

Home Repairs, $65

TOTAL, $380. 

Since I never wrote down the July budget, because it was such a crazy month, I can't figure out how I set the debt/savings goals in the first place. I'm guessing that I perhaps overestimated the income coming in (we've been working fewer hours than anticipated, which means no overtime pay), and didn't include the items listed above. 

On a different page

It can be really tough when spouses aren't on the same page when it comes to money. I know we've had more than our share of arguments about money, and feelings of anger and resentment due to it. 

I'm the more frugal one in my relationship, and my husband is the spender. I'd be lying if I said that I didn't blame every last cent of our credit card debt on him. When I'm in a nice mood, I'll say that most of it was from him, because we have put some home improvement and travel expenses on plastic - but if we didn't have to pay off all his debt, we would have had more than enough to pay for those items in cash. 

I hate being one of those households that runs paycheck to paycheck. We make more than double the average income (in fact, we just barely break the 100k threshold), and we should have plenty of money. It makes me feel insecure to not have a 3-6 mo's emergency fund to fall back on, and to have monthly payments so high that we would be unable to absorb any sort of major life event (losing a job, having to move, having a child) or serious medical problem. And I'm resentful that so much of what I make goes towards paying off his debts, that he buys all sorts of expensive things and I have to be the responsible one that scrimps & saves or else there wouldn't be enough money to pay back what he spent. 

And he's resentful of me, that I'm constantly nagging and disapproving of his spending. He feels that I'm more like a parent, and that I'm not any fun. 

We're arguing about our upcoming trip. I only marginally wanted to go in the first place, and would rather have done something else. And he wants to make the trip longer, and spend significantly more money (about 3x as much as we had originally agreed on) to be able to see/do more. 

Budget Categories

A Good Mom just posted an entry showing a pie chart with a suggested family budget (provided by the U.S. government), and asking how it compares... so I plugged in our numbers into a quick spreadsheet to take a look. Ours actually looks pretty reasonable, at least in the pie-chart. 

When we bought our house, it was very important to me to find something within a pretty tight budget - so that we would be able to someday make it on one income (if one of us decided to stay home full-time once we have kids). Our house was more expensive than most "starter" homes, but given our income level it's significantly less house than most of our friends and coworkers bought. The house category includes only our mortgages (so principal, interest, taxes, and homeowners insurance).

Our auto expenses are pretty high. We have two car payments totaling about $792/mo. I also included auto insurance and gasoline in this category. On the plus side, our cars are in decent shape overall, since they are relatively new, and we don't incur much in terms of repairs. 

The savings category only includes after-tax savings, so money going into our emergency fund & savings account. We use this money primarily to pay for tuition, vacations, and home repairs. Now that the emergency account is funded to nearly $5000, we will cut back on this and only put aside what we need for upcoming major expenses. Any extra money will be shifted to debt repayment. 

I know we spend a lot in utilities. We have a family-plan for our cell phones, and we each have a full data plan with texting added on. We have high-speed internet and cable TV at home. And we always seem to spend more on the normal utilities than most other families. Our electric bill runs about $100 during the winter months, and up to $175 in the summer. Our gas bill varies between $50 in the summer and upwards of $300 in the winter. Our water/sewer bill is about the only thing that doesn't seem ridiculous.

 

Expensive Month

Perhaps it's a good thing I decided not to make a written budget for the month of July. I knew it was going to be an unusual month, but we've already encountered a few expenses that I hadn't foreseen. 

We had to purchase a school textbook, for $80. I knew that the class had a textbook, but in the past we've been able to get away with just checking a book out of the university's library, or sometimes not buying the book at all. And when we do need to buy books, I've almost always been able to find them online (at Amazon or Half.com) for way less than the campus bookstore. It's usually under $50 per class, and then I've had great success reselling it at the end of the semester for the same price I paid. 

Unfortunately, two of last semester's books have not sold, and I wasn't able to find this semester's book for less than $75 (many were selling for upwards of $125!). 

I had my car professionally cleaned, which was an extra $60. 

And then there's our upcoming "last minute" trip, which will probably cost $250-300 (travel, parking, and food)... plus we'll have to take a few days off work, which means less money on the following paycheck.  

Wake-Up Call

Over the past year, we've had a few major wake-up calls. I know that the vast majority has been a result of the economy spiraling downward, but it has had a very real impact on our finances. Here's an overview of what we've been hit with over the past 8 months: 

• 1st credit card slashed limit by $12,900 (no reason given)
• 2nd credit card slashed limit by $10,000 (citing high utilization, likely due to 1st card slashing available credit)
• 2nd credit card issuer closed account (citing high utilization & decreased credit score, likely due to both credit cards eliminating all available credit)
• Several cards increased interest rates & switched from fixed to variable APR
• Tried to refinance mortgage, but couldn't because we owe way more than it's worth (and we would have had to pay a significant penalty due to poor credit score, which plummeted when credit cards #1 & #2 slashed limits)
• 3rd credit card hiked minimum payments from 2% to 5%

I really hate being at the mercy of the credit card companies. We've NEVER missed a payment, or even been late, but they're still able to change the rules on us whenever they want. We have to juggle our budget around to accommodate increased monthly payments (some of them pretty significant!) whenever we get a "Change of Terms" letter in the mail, both from increased interest rates and from increased monthly minimum payments. 

But the worst part is how all their changes have impacted our credit scores, which in turn has impacted us financially. We're paying more in insurance premiums, which are partially based on credit scores. Had we refinanced, we would have had to pay an extra $3000 in up-front closing costs, due to a less than ideal credit score. 

I'm so ready to be free from credit cards. It's still a ways off, but I'm feeling motivated! 

Mini-Vacation

It's been awhile since we've taken a real vacation. We've had a few short trips (mostly to visit family, or a few extra days tacked on to an out-of-town wedding or a business trip), but it's been a couple of years since we really splurged on a nice vacation. We've got a lengthy list of potential destinations, but until the credit cards are fully paid off it's too hard to justify spending the money. 

We recently decided that we're going to take another mini-vacation, to the nation's capital. It'll only be for a few days, and we're going to do it as cheaply as possible. 

We can drive there for about $100 in fuel (not counting wear & tear on the vehicle), and I haven't been able to find plane or train tickets for anywhere near that low. Low-end hotels in the DC-area are running about $75/night, which would add a pretty significant cost to the trip. Instead, we've decided to hit up a few friends/family members who live nearby and see if any of them are willing to give up their couch to us. I think we'll offer to buy dinner in exchange, but it should still be FAR cheaper than a hotel would. We'll need to pay for parking while we're there, and we'll likely also buy some transit passes to get around town. 

Fortunately, it looks like a lot of the attractions are free, so the only real expense while we're there will be food.

I definitely want to check out the White House and some of the national museums, anyone know of other free places around DC to visit?