So it has been about a year since my last update and things are still crazy, but hopefully settling down soon. In the past year we have
- moved twice and plan to move again in the next few weeks
- each got a job and moved to a different job
- paid off my student loans
- learned that we may have to pay off my husband's student loans
- MOST IMPORTANTLY Entered into Escrow on a HOME!!!
So lots of changes in our household. You can see why I haven't updated. Living with my parents for 6 months was actually really great, but the last 6 months have been not so great. I love my new job though, and we can't wait to move into our new home at the end of April.
Financially, we now are using YNAB for our budgeting and after a couple months of CRAZY spending when we last moved, we seem to have things back under control. I'm hoping this move doesn't screw us up.
So I'm really excited and I hope to update more as we re-evaluate our financial priorities and move on with our life.
So it has been about a year since my last update and things are still crazy, but hopefully settling down soon. In the past year we have
So I have been considering this for a while now, but as a graduate student who was already living very frugal, I felt I couldn't really pursue Financial Independence. With that part of my journey ending, I am strongly considering how our upcoming life choices will affect our financial situation. I talked with my husband and he has agreed to aim for a "savings" rate of 70%. I put this in quotes because I will include our childcare, debt, and mortgage in this amount. Here are the steps we are thinking of to obtain FI.
1) We have planned to move in with my parents for about 6 mons to save for a down payment.
2) DH may get a job less than 7 miles from my parents. He has agreed to bike to work most days to save gas/wear and further delay our getting a second car.
3) Depending on what job I get, I might use our car fund to pay off more student loan debt then conservatively invest it or put toward a bigger down payment.
4) If I get a job also in that area, or ven not, we might delay our dream hme to buy a smaller house that DH and maybe I can bike to work and then in 5-7 years move into our dream house in the nicer neighborhood and keep the first house as a rental.
These are all just ideas floating in my head. We have a lot of uncertainties right now as we both search for jobs. This is a scary time, but it is also a good time for us to recommit to fugality.
So in 11 days, March 15, I should have my PhD and be gainfully unemployed. Yuck! Honestly I'm really not feeling all that proud of my PhD. I already know that many business people think people with a PhD are elitist or know-it-all's or will demand a high paycheck. Really, most of us just really want to earn a real paycheck after years of working for our tuition and a paltry part-time stipend.
I can say that there is one thing from this process I am proud of. I am proud that I completed my degree a quarter early despite all that I faced: getting married, getting pregnant, having one adviser move across country, having another adviser pass away, and having my daughter 5 weeks early, and raising her while writing my dissertation.
After I lose my job, I'm going to start cleaning out our apartment, selling furniture, and generally preparing to move. Hopefully we can generate a little cash so we can pay movers to get us out of our 3rd & 4th story apartment.
Finished the first draft of my dissertation today.
I really wish I could add more to the calendar below. More little events and deadlines help me stay motivated. I wish I had some job deadlines or expectations, but I don't. Ugh I'm having goal withdrawal.
January 11 - First Dissertation Editing Meeting with my Adviser
February 15 - Finish Student Loan Savings
February 15-18 - Gaming Convention
February 16 - Neice's Birthday Party
February 22 - Deadline to Email Final Dissertation Manuscript
March 15 - Deadline to File Dissertation
March ? - File Taxes
March 30 - Passover
March 31 - Easter
March 31 - DH Finishes Admin Credential
April 1-5 - DH's Spring Break
April 15 - Finish $45K Down Payment
So as New Years approaches I am reviewing my goals for 2012 and 2013
- I defended my proposal and advanced to candidacy
- We decided to put off buying a car even longer, though we have the money set aside. I am pretty sure I want a 2008 Honda CRV EX.
- DH received his second APLE payment. He should qualify for a third depending on how long he stays in his job in 2013.
- We did not fund my husbands Roth IRA, but we are adding to his 401k to get his company match.
- We are on track to finish our down payment by April.
- I will probably finish my Dissertation in March. My first draft should be finished by January 7.
- I have been networking and applying in earnest the past month. I hope to continue between writing drafts. I really, really don't want to graduate without a job.
- We will continue to fund my husbands 401k as long as he works this job. Once that ends, we will have to reassess where we are putting out retirement contributions, but they should make it up to 15% once we both have a job.
- We will have enough money saved to pay off my high interest loans by April, though I'm not entirely sure when they will be coming due.
We have had a few financial setbacks in this last quarter with major medical bills and my funding running out for summer. I had to lower our savings rate from 35% to 30% due to increased expenses. We are also paying for child care now, and I really need to figure out how to budget for that. I was hoping we could pay for it out of my husband's bonus but that went to covering my lack of work. I will start to sell some of our things in preparation for moving after the New Year.
So we took advantage of the ING Independence Sale and started DD her own bank account. So at only 2 months, she has $23.76 to her name. We also started putting $1 for every month she is alive in her piggy bank so that there will be enough money in there when she is old enough to understand to really play with.
On a personal note, I should be getting my data on Tuesday! Then I can start my dissertation. A girlfriend wants me to apply to her company where they allow work-from-home.
Next year it looks like DH will be home 2 days a week. Hopefully we can limit our childcare needs to only 1 or 2 days a week. I need to start applying to childcare places soon.
So DD decided to make her appearance 5 weeks early, before I was able to have 3 of my 4 baby showers. Good thing we were able to return a lot of stuff so we could use our store credit because there were a lot of things we still needed. We've almost settled into a routine. I was also able to get my first 2 weeks after my leave as work at home time which will be very useful. Since DD was early, we aren't allowed to take her out or have many visitors so our spending this month has actually been way down.
Shortly before, DH started a third job giving speech lessons to a local woman. This has been earning him an additional $50 a week. The extra cash is nice.
I'm hoping by the time I return from leave I will have my data and be able to start working on my dissertation.
DH has started working on his APLE repayment paperwork. There might be a hitch, but hopefully everything will work out.
So this morning we turned in my car to finish off the lease. It will be nice to be a 1 car household for a while. I did sign up for ZipCar and even got a $25 bonus credit. I have a call into my insurance agent to drop our insurance down. That should lead us to a refund from our insurance. That money will go back into our Annual Fund. I'm also redirecting the lease payment every month into the Annual Fund. Since we already have $15,000 saved for replacing my car, all of this will help us buy the car after that in several years. Yay!!
So I just found out that the 2 pay raises I was counting on are not going to happen because they changed my funding. It's overly complicated, like all educational payroll seems to be, but I still ended up earning an additional $200 a month. So instead of earning a pay raise through hard work and progressing in my PhD, I earned it through dumb luck and some fancy accounting. Whatever, I'm not complaining.
DH and I have been going back and forth about childcare for our daughter. Since we don't know what his work situation will be like next year, specifically if he will be able to work from home part time, we don't know when we will need daycare. My University offers subsidized daycare to the children of students so I'm going to apply for that now that I know my pay situation, but I'm not sure if they offer occasional or only full time daycare. Otherwise it might be cheaper to just go with outside daycare even if it is unsubsidized.
Finally, DH has all but decided to start his administrative credential. His work offers $5000 per calendar year in education reimbursements. He is trying to decide between a traditional 15 month program which would end up costing us nothing and an 8 month online program that would cost us $2700. I'm partial to the online program since it will get him his credential by April 2013 in time for applications rather than November 2013 when it is too late to apply. Plus then he can work from home on his credential rather than going to a physical campus so he can possibly watch the baby or help me out.
So I passed my dissertation proposal last Thursday and today I turned in all my paperwork. This means I have Advanced to Candidacy and have earned another pay raise! My net increase should around $200 /month. This will all go into savings until the baby comes! Yay!
In other news we had our lease inspection for our upcoming termination date. We won't owe anything upon turning in the car. Leasing a car really was a decent move for us since we knew we would be having a baby in 3 years and would want to change cars. Still if ZipCar had existed back then I would much rather have that.
So in April we will:
1) Earn $200 extra income
2) Redirect $200 lease payment to annual savings (for future cars)
3) Lower our insurance rate & get a refund
4) Start ZipCar with the $25 annual fee
Life is pretty exciting right now.
So last night I received another medical bill, but I was perplexed by how little my insurance was covering. The bill was for the standard state prenatal screening, and I had called and been told that my insurance would cover it. I figured out that I was being billed for Out-of-Network instead of In-Network. I called the insurance, and quickly bypassed the phone tree (I've gotten too good at this) and got on the line with a representative. He said he would send it to the adjuster since the state is the only lab performing the screening. So I'm saving around $50 by a quick call to the insurance!
Lesson of the Day: Track medical expenses and know your insurance coverage. Don't be afraid to call.
So I spoke to our Personnel Manager about getting my maternity leave, and I also let her know I had earned my Masters. She said I will get paid retroactively for the pay raise I earned. In addition, I scheduled my Advancement which will lead me to my next pay raise! Woohoo! Plus this gets me a step closer to graduating and getting a real full time job.
So yesterday I had to take my car in because it was making a squealing noise and paid $300 for an oil change and new brake pads. We are turning this car in when the lease ends in April, and I am so ready to be without a car for a while. I really despise car ownership at the moment. Once the lease is done I'm going to join ZipCar which has around 15 cars on my campus.I'm so looking forward to this service. I won't have to pay for gas, maintenance, repairs, or insurance! It costs $25 per year and $8/hour or $66/day to take any of the cars. As rarely as I drive, I really just cannot wait to use ZipCar.
Now I must temper this by saying that DH will still own a car and will be home most of summer to drive with me places. Still, I really just don't want a car of my own. I'm afraid I might have to get one in August or September when DH starts work again, but I really would rather use ZipCar as long as possible. Hopefully I will feel differently come the end of summer.
Even on a small scale, it is possible to see your money working for you. I love getting my 1099-INT's from our banks and looking at how much we earn in interest. Even with interest rates so low, this is tangible proof that my money is working for me. This is way better than working for my money, or even worse paying money for money (debt). I've also realized as we are about to get our yearly credit card bonus that this is another example of getting my money to work for me. I don't believe in chump change or rounding errors. Sure there are opportunity costs to be weighed (like driving farther for pennies worth of savings), but that doesn't mean it's not worth weighing these costs. The only way for us to be financially independent is to get our money to work for us, one dollar at a time.
So yesterday we found out that DH is being reimbursed by his company for both the classes he took last semester! We were afraid one wouldn't be covered because he received a B-, but they still covered it. Man I love his job! That money will be coming in the next paycheck and going into the home down payment fund. With the extra money, we will be able to finish the home down payment and the student loan savings by May 2013. I make a point of never counting this sort of money until it is on the way to the bank so that I can revel in the progress it makes towards our goals!