Scary Conversations

Over the last few weeks, I've been having more and more conversations with my friends about money. When I talk about writing this book and the money I've kept from going out the door, they all look at me entirely different. They look at me as though I have some kind of secret knowledge that they don't have access too.

I used to look at people who had their financial act together in a very similar way. The more people give me that look of panic when I discuss personal finance, even in vague terms, the more worried I get about my friends and family.. and the community in general. EVERYONE is talking about the economy, but in all of those conversations, I have not yet talked to one person in my daily life that says "yep, I have all my finances handled and I'm prepared."

The desk staff that my doctor's office have asked me to bring in my book when it's finished, they'd be interested in buying it. I was chatting with the ER nurse that cared for YL12 on Wednesday about the economy and finance and my book, and gave her my blog address right before she gave me YL12's discharge papers.

I'm walking a very narrow line right now, in regards to my own personal belief system. I believe that I can make a difference in the lives of people around me. I believe that I have gathered, with the help of my blogger friends here, and the library, and the news articles, and personal experiences, fabulous information to share with many people. But on the other side of that line is my worry that I'm just jumping on the bandwagon to be just another opportunist, looking to make a fast buck from the panic around me.

I know there is nothing wrong with earning a living from doing a service for people. In fact, that's pretty much the ONLY way to make a living. Even as I write this, I remember all of the major points from Nice Girls Don't Get Rich by Lois Frankel, Ph.D. and her basic point is that women think that Doing Good... and doing WELL are mutually exclusive. I'm trying to break that mindset. It's hard... but dangit... I'm going to provide something that most of the people I know desperately NEED... and I'm not going to feel guilty for earning a living providing that service.

Mostly...

Hump Day - And Emotional NON-Spending

Well, yesterday was not my most frugal day ever. I did have to spend $100 on an ER copay to make sure that YL12's leg was not broken. YAY that it wasn't! Afterward, we were so hungry that we were mildly faint (we got to the ER at 7:15 and hadn't had breakfast.. it was 10:00 before we left) so I spent $8.00 on breakfast. But, that was it.

I cut all three girls' hair, so that saved at least $36 plus tip.. and that's the cheapest place. Wes repaired my laptop for free! Now I have a working laptop for book writing and web developing and blogging, and we don't have to replace it. $200 to $800 bullet dodged.

Yesterday was a bad day for us emotionally, with the money issues. We have been planning all along to buy YL18 a Macbook for her graduation gift. For a year, Wes has thought about how much he wanted her to have a Mac for school. However, our finances at this point will not allow for a $1000 gift. We are both very upset at this, but other than making an unwise financial decision to just wing it and spend the money, we aren't finding any good options. New snowflaking goal is a Mac for YL18 before she goes to college in the fall.

This is an ongoing mental battle for Wes and I (within ourselves and not with one another). We both want to be able to provide for our children the things they need, and make sure those things are good quality. But, we're also both moving into a more frugal mindset with each passing day. Sometimes it is a hard line to walk.

My Friend Owned The Coffee Shop

Back in March, I wrote a post about my friend who owns the Mom & Pop coffee shop in our town. It's a fabulous coffee shop and the owner has done a great job turning it into a place we love go to. We're going to miss her. Wes and I stopped in to get coffee and bagels this morning and the owner told us that she'd be closing her doors by the end of the month.

This little coffee shop has held on for far longer than Wes and I thought it would. It opened in a new shopping center about 2 years ago, when there was nothing else on that stretch of road. Last year, a McDonald's and a Starbucks went in side-by-side across the street from the shopping center. Both the McDonald's and Starbucks are on the right hand side of the road during morning rush hour, and when given the opportunity to get coffee from a drive-thru without crossing the street instead of driving into the shopping center, getting out of the car, and going into the shop, it's easy to see why her business dropped off so much.

I guess the old saying is true: Location is Everything! No matter how great her product was, or her personality, or how comfy her chairs... sometimes it's all about the location.

My Project

I've decided to get off the fence and go with my passion. I love helping people improve their household finances. Over the last several years, I've read a million and one finance articles. I started reading Yahoo! Finance, then MSN Money, MSNBC Business, CNN Money, and a ton of books. I've taken online accounting courses through a local university, and even pondered going back to school to get my degree in Finance.

From the point of reading that first Yahoo! Finance article, I became obsessed with getting our family's finances on the right track and maximizing our spending. Mostly, I focused on retirement research. After I opened my 401k with my employer and maxed out my contribution, I breathed a sigh of relief and went on about my business. My projections show that with a standard rate of return, if I work until I'm 65, we'll have enough in the retirement account to live on $120,000 a year for the rest of our lives and still leave money for the kids.

I realize that retirement is far more complicated than that, but knowing that I have at least a loose plan, I felt free to make changes in other areas of our lives. I created a budget for our family in excel. It's a complicated spreadsheet and covers lots of variables for 5 years. It also has a section that tracks debt reduction, and feeds right into the rest of the calculations. This spreadsheet has been shared with quite a few friends and relatives over the last year and it's been wildly successful!

I've tweaked and adjusted and learned more and implemented tips and tricks from other bloggers and sources until I have our finances rolling like a well oiled machine. And everything I need to manage our household finances on a monthly basis is contained in one 3 ring binder. Not too long ago, Wes was watching me process the weekly grocery list and manage our household finance tasks and had an epiphany.

I think everyone is aware that the economy is going down the tubes. For most of the people in our lives, this means radical changes in their household finances... but they don't know where to start. I'm going to help give people that start.

My new career path is Household Finance Coaching. I'm writing a book to go along with the organizational binder. I already have the binder in Beta form. I'm working with several test households to get real numbers in line. I'm building a new website, and am going to give this a whirl. I really am looking forward to making a difference.

:) And when the book is finished, I'm going to give away a free copy here.

Dodging a Bullet

Thursday, on my drive to work, my Overdrive Off light started blinking on the dash. While I was driving, I could feel the transmission repeatedly engaging and disengaging the Overdrive. Then, as I was pulling into the parking lot at the office, the check engine light came to life too.

SIGH... Just when I thought we were getting a handle on things, here we go again. The last time we had to have the transmission replaced on my Windstar was 2 1/2 years ago and, at $2600, it meant that Wes and I had to fore go our wedding reception. This time, I decided that I wasn't sinking another $2600 into a repair for an almost 9 year old car with 153,000 miles on it.

Yesterday, Wes dropped the van off at the repair shop and I headed on in to work in his car. When I got here, I went online and tried to line up financing for the new (used) car we were going to have to get. I filled out a couple of online apps and within 30 minutes had 3 offers for full auto financing at conventional rates. Thank goodness I've been working so hard to get our debts paid off and our credit score boosted.

After the 3rd call from the finance departments, Wes called. The problem was a $2 sensor that the transmission place replaced for free... no labor or part cost. The owner said t hat if we refer one customer, we've done well for him. Can't beat that!

So, I've called back all of the finance places and thanked them for their time and told them we'll keep them in mind for when we replace our cars next year. WHEW... I'm glad we didn't have to go further in debt, but I'm glad to know that it's an option if we're desperate.

Charity - Giving Until It Hurts

While prepping a guest post earlier in the week, something was niggling at the back of my mind. The post was about helping my brother financially, even when he was making bad decisions. I couldn't shake the feeling that there was more to the story.

Just a bit ago, it hit me. Wes and I are charitable to a fault, at times. Yet, until recently, we never really stopped to think about our own long term financial situation. Even now that we're watching every penny, I find that we're still in that Giving mindset.

Money has never been much of a top priority to me. I've been dirt poor the vast majority of my life. Until four years ago, when I met Wes and we eventually combined our houses and incomes, I raised 3 daughters, with no child support, first well below and later just barely above what the government considers poverty level. Even when I was destitute, my door and kitchen were always open to family and friends (chosen family). What is mine is yours. It's just how families do things where I'm from.

Although the debts were there, and accruing interest, and not going away, Wes and I ignored them. They were just insurmountable, so we just let them be the elephant in the room.

Wes enjoys giving to our friends and family as much as I do. We just do it in different ways. He insists on picking up the tab whenever we're out with friends. In fact, he does this so often that it's made a few of our friends uncomfortable.

Over the years, I have allowed people to move in with me and not pay any expenses, although I was barely making it myself. I've hired family members who were in a rough place financially to clean my house, or groom my pets, or work on my car, even things I was perfectly capable of doing myself. I've found reasons to "just have this lying around" when someone I care about has a need. And, yes, I've even loaned out money to the tune of hundreds (adding up to thousands) of dollars that I knew I'd never be repaid. It didn't matter... I was just helping.

When I finally decided that it was time to take control of our finances and get this debt handled, it required a large shift in the way we responded to those around us. My extended family has gotten accustomed to treating us as the Bank of Wes and Momma. Wes has offered to "be the heavy" and let them be mad at him for saying no, but I've learned to say no on my own. I'll continue to do so until our debts are paid, our retirement accounts are fully funded, and our children have college educations.

I no longer say "Yes" when people call me for money. I do, however, offer to help them with a budget. When the conversations start to angle around to how tough their financial situations are, I nod my head and agree that we're all having a tough time. Wes and I go out far less with friends, and try to make sure that the time we DO get to spend with friends is about the relaxation and enjoyment of their company. Since we know that we're likely to insist on paying, we have decided to entertain at home more.

We still give when we can, and when it's important to us. We still live under the belief that if you're family and you're in need, we'll do all we can. We've just adjusted our priorities a little and shifted the ways we give. At least until all this debt is gone.

Summer Break - Those Pesky Kids

Summer break is 5 weeks away for the children at Momma's house. Usually, my 3 bio daughters spend the summer with their father in a different state. They generally leave here the day after school lets out for the summer and don't return until a week or so prior to the beginning of school in August.

This year, their father has gotten caught in the economic downturn. He hasn't got a job and his living situation is precarious. Therefore, the young ladies will be staying home with us this summer. They're incredibly excited. This is the first time in 8 years that they've spent a summer with me. Of course, that doesn't change the fact that I have to work.

They're all old enough that they don't need a babysitter, but I think it's a miserable summer if they have to spend every day hanging out and waiting for us to come home from work. In the past summers, we've gotten them Six Flags season passes. It's a great investment for us because we always go more than twice a season (the break even point for season passes) and the Passholders Only day at the end of the season means that we get lots of Christmas gifts for next to nothing, as everything in the park is at least 50% off.

This year is different though. Wes' work situation isn't as secure as it has been in years past. I'm torn between being frugal and making better decisions with our money, and making sure our kids don't have a summer of boredom and exile. The 15 year old (in 10 days!) wants to get a job at Six Flags, so maybe it's not such a bad idea! But everyone knows that those amusement park passes are paid for with the extras... not the passes.

While I ponder this, I'll just share my snowflakes for today:
$11.30 (water bill was less than budgeted)
$4.49 (sold a book on half.com, this is the sales price after shipping and commission)
Yay for baby steps.

So, what do you think about the season passes? Good idea or no?

Emotional Spending

On Saturday, I requested (threatened bodily harm unless I got) some alone time. My wonderful husband loaded up all four children, ages 10, 10, 12, and 15 IN 19 DAYS!!, and took them out for the afternoon. First, they tried bowling... no lanes open until 9:30 PM. So, they spent their allotted $10 in quarters at the video arcade and tried to figure out what to do with the rest of their night in exile.

I got a call from Wes just before they left the bowling alley. The new plan was dinner out at Taco Mac so he could watch the basketball game and hang out with the kids. :) This left me at least 2 hours to enjoy my alone time and do all the things I'd been putting off.

I cleaned my bedroom, washed laundry like a fiend, puttered and organized and straightened. I had the iTunes set to shuffle on Wes' computer and the music was cranked. Not exactly the way I THOUGHT I'd enjoy spending a Saturday night, but I'll take it.

Just as I was finishing my bedroom chores, I got a call from Wes. He and the children were on their way home and they had a surprise for me! :) I had a surprise for them too. Clean laundry and a clean bedroom. When they got home, three of the children grabbed me by the hand and took me to the kitchen, where I was presented with a spring bouquet of flowers and a bar of dark chocolate. I hugged the children and exclaimed that I have the best family ever!

Wes said "uh, you might want to rethink that in a minute." That's when I walked into the living room and saw the box... The flowers and chocolate were not a gift.. they were an apology! My family waited until I wasn't there to say no and bought Rock Band! I'm very proud of myself. I didn't rant, yell, or otherwise undermine Wes' purchase. I did, however, pour myself a very large glass of wine and retire to my (now spotless) bedroom to play video games.

My 12 year old daughter, came into the room and her eyes were filled with tears. She is the one who suggested the purchase and felt guilty that it had upset me. I recovered pretty quickly and asked her how much it cost. When she said it was $170 dollars, I just smiled and said "That's OK, it's the family entertainment budget for the next month. Now ... go play your game! Enjoy it and get all the use out of it you can because we're not going out to do other things for a while."

When she left, Wes came into the room. There was very little spoken. I understand what happened. He knew it was a purely emotional purchase. Sometimes, he just feels so badly for having to say no and be practical all the time that he makes large impulsive purchases. I feel that way sometimes myself, but I'm better about keeping a grip on it. I'm sure it's a pretty common phenomenon in people who are making the move to more frugal living. We just resolve to do better next time and move on.

On the upside, it's a FABULOUS game. The entire family gets to play at once. There is noise and laughter and real family time going on. They played until 1 AM. ;) Of course, nobody has beaten my score for vocals on Wanted, Dead or Alive! Momma ROCKS.

My Friend Owns The Coffee Shop

Wes and I have been far more careful about our spending in the last 6 months or so. We've made a concentrated effort to keep our expenses low and implement a (more) frugal lifestyle. In the past, we often stopped 3 or 4 mornings a week to have coffee and bagels at our friendly neighborhood coffee shop. The owner is someone that we consider more than an acquaintance and less than best friends. We stopped for the company as often as we stopped for the coffee.

The problem is that we became invested in her success. We want to see our friend do well. We want to contribute to her success and support her in any way we can. But, of course, our priority is to maintain our goals and financial decisions. We know that the shop is struggling, now that there is a nifty new Starbucks across the street and the economy is slowing. We sure don't want to see yet another Mom and Pop kind of place go under due to the massive steamroller that is Big Business.

I struggle with this fairly often. I know that the success or failure of her business does not depend on a single customer. I know that it's a tough business world out there and we're not responsible for the way life works. But, it's hard to see someone or something you've invested in hit rough times.

There are times when responsible spending is rough. It's not as easy to see the impact at the Wal-Mart or Starbucks as it is with Mom's Coffee and Bagels.

Hiccups and Money Stress

This weekend was a difficult one for me. I'm still trying to wrap my mind around the emotional relationship I have with money. I am relieved to have enough money saved that I can replace the tires on my car without worry. If the electric bill is more than expected, there is no financial crisis for us. If we forget to lay out something for dinner and we just decide to jump in the car and go to a restaurant, there is no big dilemma.

However, there really is. Or, there will be. Maybe.

Starting our own business was a great idea! We had enough money in the bank to cover 3 full months worth of expenses while Wes concentrated on contracting work, as well as looking for a "regular job" so that he kept all of his options open. Wes has already completed one contract and we've invoiced for (OMG) $10,000. He started another contract today, for a considerably larger amount. Why am I worried? Am I completely crazy?

Once again... Maybe.

The invoices have been sent out for the completed contract, but nothing has been paid. In 3 days, we will be at the "Net 30 Days" for the 1st invoice and I am nervous that it won't be paid on time, or at all if the company decides to be difficult. Ok, so even if that invoice doesn't get paid... Wes is still working on the 2nd contract! No problem! Except... that contract is "Net 45 Days" ... so, no paid invoice for 2 months. Ut oh... now we may have a problem. No money from our consulting company for 2 more months is a definite possibility.

Jumping in the car for that "no problems" dinner is suddenly seeming like the beginning of a possible problem. Wes doesn't seem worried. I have complete faith in him to provide for our family. I also have a job, but it barely covers the house payment and half of the utilities. So, if nothing else, I know we won't be homeless or starve. I am just SO emotionally attached to that number in the ING account. It causes me great amounts of distress to see that number going down.

Granted, we planned for this. It's been budgeted. We've looked at everything from every possible angle. We've discussed it. We both agreed to this course of action. So, why can't I get my head wrapped around the depletion of our savings to bring our dreams to fruition? Whew... I hope I work through it soon.

Changing Income Without Changing Lifestyle

I was contacted by a recruiter friend yesterday. He knows of an opening for my dream job, which I am qualified for, at more than double my current salary. He's offered to pass on my resume for the position.

Upside:
More money
Extensive experience in a growing field with too few qualified candidates
Challenging job where I get to learn more and love what I do
Likelihood of a long term career with a HUGE nationwide company

Downside:
It's contract work, and the contract ends at the end of the year (but will likely renew).
Our health insurance is through my current employer
The hours will be less flexible than they are now
I lose my accrued vacation time (2 weeks starting at the end of April).

Of course, these are not the only considerations. Currently, I work for a nationwide moving company. We are entering/have entered a recession. The first thing that happens in a recession is that people and companies stop relocating (using professional movers anyway) which makes my current employment extremely precarious. If the economy does not improve, I will not have a job in two months, much less the end of the year.

So, I'm rolling the dice and I'm at least hoping to interview for the new slot. I've pulled up my handy dandy budgeting spreadsheet. I have input all of the numbers, and even with the expense of COBRA coverage, changing jobs is hands down the best financial decision.

The real challenge will be in maintaining our current spending habits and lifestyle in the face of a substantial increase in salary. Wes has already had the High Life. He's had the 3 story house blocks from the beach in LA. He's had the multi million dollar net worth. For a redneck, he's had a pretty charmed life financially (until he hit the bump in the road that everyone else did when the .com bust happened).

Right now, when there is extra money in the budget, he doesn't talk about saving or getting out of debt. He talks about replacing the carpet, fixing the front steps, rebuilding the back deck, adding a room onto the house, etc. If I do manage to pull a rabbit out of my hat and double my salary, I'm going to have to keep a tight reign on the finances until we're on steadier footing.

Looks like I'm going to be reading up on how to deal with this situation. I'll be sure and post any links that are helpful. Does anyone else have suggestions?