The topic of stewardship or how one makes the best use of one's money seems to be going round and round in my head these days. I feel it is for a reason, just not sure what the reason is yet. Anyway, I overheard an interesting (to me) exchange last evening while at my son's baseball game. As usual, the parents were sitting on the bleachers and siblings were playing on the nearby playground, begging for items from the snack bar, etc. Two girls (about age 8) had gone to the snack bar to get treats. They returned and each gave her mother her change. One mom saw that her daughter had two ice cream treats and asked her why she had gotten two. The little girl said that she had asked for something different but the people in the snack bar got confused. The mom then asked her if she even liked the one item, she replied I don't know. The mom's response to this was what I found interesting. She said "Oh well, you can try it and if you don't like it just throw it away." I just couldn't help wondering what she was teaching her daughter about waste with that attitude. To me, it was that it is okay to waste both money and things. Not what I want to teach my kids. Sure, it was only an ice cream treat that cost no more than 1.50 but there were so many other options. She could have gone back to the snack bar with her daughter and explained the confusion - they would have gladly taken it back or exchanged it for something else. She could have told her to just eat the one treat and offer the other to someone else. There were plenty of other childern who could have enjoyed it. The two girls went off to the picnic tables to eat so I don't know what became of the ice cream treat but I just couldn't stop thinking about the attitudes involved. Would she give her daughter money and tell her to just throw it away if they didn't have what she wanted? To me, it is not about not spending money or even how much money you do spend, it is about making the best use of your money and spending it on things that are important to you. Sometimes it will be paying bills, and sometimes it will be as simple as treating your kids at the ball game. But either way, shouldn't you still try to make the best use of it?
Archive for May, 2007
Yesterday was my grocery shopping day as well as miscellaneous errand day. I was very proud of myself for setting a limit at the grocery store and sticking to it. I felt like I had been overspending the last few weeks for no other reason than because I could; for me that is not a good enough reason. With that in mind, I set myself a budget of $65.00 for the weekly trip to the local grocery store. I not only came in under budget (62.38) but found an error on the receipt in the stores favor. They had double charged me for something that I had only purchased one of. I usually scan the receipt on my way out of the store so I caught the error right away. My first inclination was to just let it slide "its only $2.38" but then I thought "No, its my $2.38". I took my cart, my receipt and myself over to customer service and explained that they had accidentally double charged me. I figured they were going to go thru the bags to make sure that I did not have two of the item (I knew I didn't) but they just scanned the one and refunded my overcharge. They did make me sign the back of a refund slip so I am sure you could not use this as a scam and try it often but in my case it was totally legitimate so I got my refund and left. It seems silly in some ways, it was only $2.38 but in the larger picture I look at it in terms of stewardship. Why should I let someone else take money my DH and I work for over a simple error. I recently heard a quote I like "I like to spend but I hate to waste." This was from someone with a lot of money who could afford to spend and spend and spend. I really like the values it sums up - enjoy your money but do not waste it. Letting the mistake go unnoticed would be wasting my money. After all, I would not just take $2.38 and throw it into a trash can.
My other small victory came in finding a bargain on a dress. We were invited to a wedding in late June and I really did not have a suitable dress. I don't dress up much so my dress wardrobe is rather miminal. I did have one dress I could wear but I had worn it to another wedding given my the same family (neighbor has 3 daughters - 2nd one is getting married) so I really felt I needed something else. However, since I don't dress up much, I tend to not want to buy dresses and those I do buy I want to be classics that I can keep and wear for years. I happened to be near a local Goodwill with time to kill before picking my kids up from school. I figured I would just go in and look, not really expecting to find anything. Well, I was thrilled to find an brand new, tags still on, in my size, prefect for the wedding, classic dress for $9.00. A bit high for Goodwill but that was because it was still brand new. I snapped it up (after trying it on) and am thrilled that I now don't have to worry about what to wear. Not only do I have that problem solved, but I was able to do it for only $9.00. Shoes are still an issue but I might be able to borrow something from one of my daughters.
Does anyone else ever feel like they are alone in their quest for fiscal responsibility (aside from PFA of course). The more I look around at my neigbors (and some of them are my friends) the more I shake my head and feel like I am all alone in my quest to be financially responsible. Even my DH often makes me shake my head although in the 21 years we have been married I have been slowly and steadily converting him. Two separate incidents have been making me think this way this week. The first involves my two neighbors who live across from my house (and next door to each other). One sold a perfectly good John Deere Lawn mower and purchased a newer model for around $10,000.00 (yes - that is a 10 followed by thousand). What!!!!!!!! It's not a car, he cannot drive it to work, what is he thinking. Unless it is guaranteed to cut the grass all by itself for the rest of my life, I could never spend this much on a LAWN MOWER. (And his lawn is under 1 acre!) Not to be outdone, the next door neighbor gave his older lawn mower to his 11 year old son (who has done the lawn mowing for the last 3 years but that is a whole different story). He goes out an buys a $5000.00 lawn mower!!! What!!!! Again, his son was mowing the lawn for the last 3 years on a perfectly good mower!!! These two are just plain crazy in my book and so are their wives who take the attitude, boys and their expensive toys. The second incident was a conversation with a different neighbor and friend. She was complaining how everyone always seemed to be asking her for money this time of year and there were so many additional end of year expenses like kids field trips etc. She wanted a piece of softball equipment for her daughter but didn't want to spend any more cause her DH was not due to get paid for another week. Knowing that my oldest two girls used to play softball, she asked if we had the equipment in question and could her daughter borrow it. I said sure since we were not using it at the time (although the youngest probably will in a year or two). About a week and a half later I saw her and she asked me to admire her manicure and pedicure that she had treated herself to. She had also treated her 9 year old daughter and then gone out to dinner with the whole family that evening. Now, she has the right to spend her money any way she chooses, but it certainly irks me that she asked me for the softball equipment while complaining about money being tight. I know her DH got paid between our first and second conversations, but I cannot help thinking that it is no wonder money is tight toward the end of his pay if she spends like crazy as soon as he gets the next check. Again, all the people mentioned here have the right to do whatever they want with their money, it just makes me feel like I am very lonely in my quest to be responsible. I am very thankful for sites like this one that let me know I am not really all alone - it would just be nice to have a real flesh and blood friend or neighbor who shared these values and that seems to be very hard to find. I do have a few, they just do not live very close so I don't get to do fun/frugal things with them very often. Okay, thats my rant for today.
I am realizing that now that we have "enough" (as in enough to pay all the bills) money coming in I am starting to slip with my spending. What I mean is that I have noticed small things like my grocery store weekly totals climbing by $20.00 or so a week. The first week I chalked it up to buying some things we had not bought in a while but after a second week I realize that I am not being as diligent at questioning each purchase. On some level I do not have to be, but on another, I still do because we now have debt on our home equity line that I would like paid off ASAP. I feel like I am wavering back and forth on feeling giddy that I can spend a bit extra, worrying about paying off the debt and also torn between deciding where the extra money should go. I have so many things I want/need to fund and only so much money to do it with. Currently we have a bit over $10,000 in debt on the home equity line. I could probably pay at least $500.00 towards this a month, but I also want to put money towards retirement accounts and emergency fund. I am still waiting to hear if DH will be eligible this year for the company 401K. The normal wait is 1 year but since he was previously employed by them they are seeing if this can be waived. If yes, we will definitely contribute enough to get the full company match. Why throw away free money. If no, I will have to be more diligent at contributing to IRAs or ROTH IRAs for both of us. Not to mention that we have 4 kids, the oldest of whom has only 2 more years til college. I feel like I keep going in circles trying to figure out the best use of the extra moeny. Right now, my plan is to put a small bit aside each month for the college funds ($50.00 per child - we had been doing this all along into a prepaid state plan). I cannot afford to put more til we get the retirement funds maxed out. I will pay a bit more than the minimum on the home equity debt but will resist the temptation to put all extra money toward erasing that. When I put it into perspective, it is only $10,000. Our home is worth close to $400,000 and our mortgage balance is under $120,000. It is not like we would be upside down on the mortgage if we had to sell for any reason. It is just that I hate debt (I tell my DH that I am allergic to it) and I want it erased ASAP. So, I have to war with this side of myself to let my logical side fund retirement. I just have to keep reminding myself of the power of compound interest and that we need this working on our side in terms of the retirement accounts. I also want to put a small amount aside each month to build back up savings/emergency fund. It doesn't do us much good to pay everything off and fund retirement etc. and then get back into debt any time anything unexpected comes up. Hopefully some of this made sense to someone other than just me. Either way, I just sort of needed to get it all out there, instead of having it circle around and around in my head. Any suggestions as to setting priorities are welcome.
I am now breathing a big sigh of relief for real. I feel as if I had been holding my breath for the last 11 mos. (since DH was laid off last June). He went back to work for the former employer and received his first pay this past Friday. It was so nice to be able to pay all the bills without having to take anything out of savings/line of credit. My goals now are to sit back, re-evaluate where we are and pay off debt/build emergency fund. We also got back our tax refund this weekend. That will go right into our ING acccount to sit and earn interest til we need it to pay our school taxes in August (we pay ourselves rather than having mortgage co. escrow). I like the feeling of knowing it is sitting there collecting interest, working for me. Even better would be not having to spend it but I'll take the interest for the few months. My focus is now on getting our line of credit paid off but balancing that with refunding savings/emergency. Since the line of credit interest is tax deductible, I do not feel so bad about diverting money to savings. I would rather build a small savings/emergency fund so it is there if we need it and we don't have to add to the line of credit. I am just so excited to finally feel like we are getting back on track and heading in the right direction. When DH was unemployed or working lower paying jobs, I felt very frustrated because even though I was doing all the right things, there just was not enough money coming in to cover everthing. Thank goodness that I am frugal by nature and we started out with a decent savings account and no debt. If we had been in the same situation but with existing debt (non-mortgage I mean) and no savings, we probably would have been forced to take much more drastic measures like selling our home. I definitely believe the saying that whatever doesn't kill you makes you stronger so I think I have come out of this last years experience a stronger and better person for it. I have realized what is really most important in life and it is not money. It has helped me put things into perspective, but I must say again, I am still breathing that big sigh of relief.
My oldest DD is 16 and got a part time job which will also be her summer job. My husband and I will have to drive her back and forth but it is less than 5 miles from home so it is not too big of an inconvenience. I am glad because it will give her money of her own to spend, save, budget etc. I have already spoken to her about opening a retirement account and funding it with $500 to $1000 this year. Her first reaction was to roll her eyes as if I was just being crazy again. When I showed her charts demonstrating the power of compounded interest over time and how much she would have when she was my age, just by making a small sacrifice now when she does not really need the money, her tune changed. I told her she could do this for 5 years and still outperform someone who invested a lot more but didn't start til they were older. Her response was, "well then, why would I stop adding to it after 5 years. Couldn't I keep putting money in?" Words to make a frugal mother cry tears of joy! I have save the best perk for last - free water ice for immediate family members! (Okay, maybe not the most important perk but I do have my priorities). She is working for Rita's Water Ice and immediate family members get free water ice when she is working. I am already telling my 13 yo DD that she will HAVE to work there in a few years so I don't lose my water ice connection!