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Archive for November, 2010

My Frugal Holidays

November 17th, 2010 at 09:36 pm

So I'm almost finished with my holiday shopping! **dances** And I was able to utilize my ever-improving frugal skills to do it for ridiculously little! **dances more** Here is what I've got:

- Gifts for Parents: Each gets a wedding photo album from Shutterfly. I got both for free and only paid shipping.
- Gifts for niece & nephew: Purchased off Amazon.com using swagbucks gift cards and free shipping from Amazon Student.
- Gift for DH's cousin: Purchased from ULTA during a sale using a coupon and got a free bag (which will probably become part of another gift).
- Gift for DH's brother: Amazon.com gift card part of which will be from at least 1 more swagbucks code.
- 2 White Elephant Exchange gifts: Picked up 2 $5 Starbucks gift cards by doing surveys.

Gifts to still get:
- Family Christmas gift exchange: Probably use the gift bag and some free samples to create a bath gift set. Need to find out details of exchange.
- Family Secret Santa: Probably use amazon.com swagbucks. Need to find out details of exchange.

And that's it. DH and I never do gifts for each other, so that covers the holidays.

Spending to Save

November 12th, 2010 at 09:39 pm

Lowering my future expenses is one step to bring myself closer to financial independence. Lower expenses means less need in net worth and greater savings from income. Here are some things in my life that I can spend money on to lower future expenses:

- Pay cash for a car
- Pay off debt
- Purchase a house
- Pay off house debt
- Buy an older/safer car for lower insurance
- Buy and grow herbs in my window (those of you lucky enough to have backyards/patios can plant vegetables/fruit)

Those are all that I've thought of right now. Any other ideas?

Logging our Net Worth

November 9th, 2010 at 05:51 pm

I started logging our net worth each month. I use our cash and stock investments minus our debt to decide our net worth. I don't count our checking account since this amount fluctuates too often. I don't want to include non-liquid assets in my calculations. I'm also tracking our "multiplier" = net worth / yearly expenses.

This is forcing me to face the fact that most of the money I am currently saving will just be spent within the next 3-5 years on buying a car and buying a home. This is sort of depressing, but I have adjusted my goals accordingly. I'm hoping that by the end of 2015 I will have saved 1x our yearly expenses over our debt.

Thoughts:
- When we go on vacation, our net worth will drop because the vacation account is included.
- When we buy a car with cash, our net worth will drop by the cost of the car.
- When we buy a home, our net worth will drop by the total cost of the home = down payment + loan amount.
- When we pay off debt, our net worth will rise.
- When we put money into retirement, our net worth will rise, though there will be volatility.

Actions:
- Try to buy a less expensive car.
- After buying a car, put the extra money away into a low risk mutual fund and redirect the lease payment into this account. Possibly exclude this from net worth calculations to simplify.
- Pay off debt quickly. Saving to pay off subsidized student loan debt is a good way to increase net worth.
- Reducing expenses increases the multiplier two-fold: decreasing the denominator and increasing the numerator.