Saturday, January 31, 2009

One Month Down

As you may recall, my wife and I have declared this the year of getting out of debt. January has come and gone, and it has been an interesting ride thus far.

I cannot say we made significant progress in decreasing our liabilities. This is mainly due to the fact that our businesses are extremely seasonal (winter being our low season). And, while our income is at a minimum, our bills and expenses continue to be the same. Add to this some advertising opportunities we wanted to take advantage of.

Therefore, this month's focus was on monitoring our spending. We only spent money on that which was necessary. We kept a very close eye on our grocery budget and only ate out (fast food) when we had no other choice.

This month we said "No" to:

A Friday fish fry (and going out to eat in general) x10
New cell phones
The Wynn's $109/night deal (not really!)
Drumstick ice cream bars
Going to the movies
A Juicy Couture swimsuit (for Monica)
Using a really good coupon to Express for Men
Bath & Body Works hand soap
A couple books

We've found that staying out of the malls and stores has helped a lot. Even staying out of the grocery store has kept us from buying unnecessary food, thanks to Peapod.

I have been working a part-time job and am also working on a new business idea that should help us make significant strides.

This month has taught me the importance of discipline. In order to balance everything I have going on in my life while keeping a close eye on our spending, I need to keep a thorough calendar of each day's events. I'm trying the block schedule approach suggested by Liene from The Smart Planner.

It's hard to say what February's focus will be. My income will go up this next month compared to January. With this extra income, I think the trick will be deciding how much should go toward our debt and how much should be saved for future expenses.

How has your year started financially? Have you been monitoring your spending more closely?

Wednesday, January 21, 2009


In an attempt at being more precise in our grocery budgeting, we are seriously considering using Peapod, the grocery delivery service. We received an offer in the mail for $20 off our first purchase and free delivery for 60 days.

We have been working on comparing prices on the website to those we normally pay at the grocery store. So far we have found that some things are more expensive and some are less.

There are delivery charges we need to factor in, but at the same time we are considering the time we will save by not making long trips to the store.

We also figure that by having a running total at the top of the screen as we add items to our "cart", we know exactly how much we are spending and won't have any surprises at the checkout line. Also, there won't be those tempting sale items or mid-shopping cravings that cause us to grab a bag of Oreos. (Tell me I'm not the only one)

We have been told the produce is very fresh so we figure we won't be throwing out as much food as we have in the past.

Peapod also has their own sales at times and also accept manufacturer's coupons.

So, why not give it a try? I'll give you the report after all is said and done. In the meantime, have you used Peapod before? Please let me know what you're thoughts are.

Sunday, January 11, 2009

A Wedding B-B-B-Budget

Engagement season has passed and wedding planning season is well under way. In the beginning stages of planning your wedding, the first topic you consider should be the budget. This may sound very elementary, but it is astounding how many couples start their planning without determining even a range for their budget.

If you are currently in this situation, I highly recommend you read three blog posts that will help put things into perspective for you.

First, Money Matters Not So Much was written by Monica to explain to brides that a budget is inevitable. If you don't talk about it, you are putting yourself at serious risk. Once you set your budget, you have at least some sort of framework in which to start your planning. Prioritization will obviously be necessary with any budget. Visit Monica at The White Box of Wedding Design if you need further inspiration or ideas.

Second, The $28,000 question: Why are we all hypocrites about weddings? was written by Ramit Sethi of I Will Teach You To Be Rich. Ramit takes a very realistic approach in this article as to how wedding budgets escalate as the planning process progresses. His biggest point made is for those who are currently not planning a wedding, but foresee one happening in the not-too-distant future...Plan Ahead! Start saving this month if you know you are going to be paying for the wedding yourself. This applies not only to weddings, but to cars, houses, furniture, appliances...anything!

Third, Liene Stevens of Blue Orchid Designs wrote Your Wedding Budget Does Not Define You. Don't be ashamed of your budget. Work with what you have and be fabulous no matter what. Liene will show you how.

SO, the moral of the story:

1. If you're engaged, set a budget for your wedding.
2. If you're engaged and live in Milwaukee (or are visiting), check out The White Box. You will certainly NOT regret it.

Thursday, January 8, 2009

Suze Orman on Oprah - Free ebook

Suze Orman will be on Oprah today as part of Oprah's Best Life series. She will be talking about how to best deal with the financially hard times we are experiencing. Orman is well known for her sound financial advice and clear-headed ways of thinking.

She also has an ebook that can be downloaded for free on the Oprah Winfrey website. Download Orman's 2009 Action Plan here.

Wednesday, January 7, 2009

The Smart Planner

I'm being featured today on a great blog called The Smart Planner. Liene Stevens is the founder of this blog that focuses on helping wedding planners build their businesses in a purposeful and logical way. It is already obvious that Liene has made a difference in the wedding planning industry. Even if you are not a wedding planner, you can still gain some great insight on leadership and managament from this blog and also her unique Twitter series.

I will occassionaly make guest appearances on The Smart Planner and will gear my posts toward helping planners make the best financial decisions as they grow their businesses. Check out my post today about the advantages of using QuickBooks software to manage the financial aspects of your business.

Twitter Series

If you are a Twitter user, be sure to look for a short series of tweets called $Money Talks$. I will be featuring some interesting quotations from some popular financial gurus. Follow me at

Tuesday, January 6, 2009

$$ for your old ink cartridges

You may already be familiar with Office Max's incentive program MaxPerks. If not, it's basically a card you swipe with every purchase and you receive 5% back to spend on more office supplies. (The shopping list is always endless, right?) Occasionally, they will offer up to 25% back on certain brands or items. If this isn't worth it, the valuable coupons they send out definitely seal the deal.

Also, I found out the other day that for every empty ink or toner cartridge you turn in at the store, they put a $3 credit on your reward balance. You can turn in up to ten cartridges a week. This can really add up over time - especially if you have access to some cartridges from the office or elsewhere that are getting thrown away anyway.

Monday, January 5, 2009

The Emergency Fund

Upon completion of putting together your household budget and taking a close analysis of your financial situation, build up an emergency fund. Or, as Dave likes to call it, the "rainy day" fund.

A well-funded emergency fund will cover expenses of anywhere between three and six months of living. Depending on how much job security you have or how difficult it would be for you to obtain a new job, you may want to adjust your goal accordingly.

It will definitely take time to fully fund this account, but I recommend you make a goal of saving up $1000 as fast as you can to get the ball rolling. For some, this may be easy as you already have at least that much in the bank. For others, you may have never had that much money to your name - ever. Well, it is possible, and after doing so I trust you will have the motivation and momentum to keep saving more.

Do whatever it takes to save up this money. Get a second job. Sell stuff on eBay or on Craigslist. Shovel sidewalks. Deliver newspapers. Babysit. Clean houses. Anything.

Once you have your $1000, put it in a place that is accessible, but not too tempting to take advantage of.

Now the big question - What counts as an emergency?

Only use your emergency fund for unexpected occurrences that you cannot plan for.

Examples: an unexpected pregnancy, you suddenly lose your job, you blow the engine on your car, an emergency room visit, the furnace breaks down.

Examples of non-emergencies: routine car maintenance (oil change, new tires, new belts, etc.), your TV broke, a 75% off clearance sale at Banana Republic, an annual doctor visit, the need for new furniture, craving a mocha frappuccino, you get the idea...

Once you reach your $1000 goal, you can smile big for a day, but the battle is just beginning. After that, it's time to tackle that debt of yours and continue to fully fund the emergency account. Please feel free to share any ideas you have on how to build up your $1000.

Saturday, January 3, 2009

First Things First - Start with a Budget

If you're going to work at getting out of debt, you need to take a very serious and precise approach to the way you handle your money. Consider what you own, what you owe, and what you spend.

The key to creating a budget that makes sense is to assign every dollar you make to a specific category. Some categories are straight forward, such as a grocery budget. Every week you put aside a specific amount for food and each week you spend that amount. Other categories, such as automobile expenses can vary each week or month. Even though you change the oil in the car every three months, you should still put aside 1/3 of that cost each month. Perhaps you pay a life insurance premium annually. Be consistent in putting aside 1/12 of that amount each month.

Always remember, if an expense is expected, it is not an emergency. Plan ahead and you won't be caught off guard with these expenses. Any money that may be left over at the end of your budget, put toward an emergency fund until you have at least $1,000 on hand just in case the unexpected does happen. This could be an emergency room visit or perhaps the need for a new furnace.

You may fill out your entire budget and come to realize your spending outweighs your income. This is a serious problem, especially if it continues for a number of months. This issue must be addressed as soon as possible. Analyze the situation. Can you cut back on entertainment and eating out? I think so. Is your mortgage over 25% of your income? Maybe it's time to move to a smaller house.

On the other hand, how can you raise the top line? Can you work a second job? Deliver pizzas? Sell stuff on eBay? Plainly stated, if your expenses are more than your income, you need to either make more money or start spending less. It's that simple. The rest comes down to creativity.

I do not intend to sound unsympathetic. I understand people have all sorts of different financial situations. But, financial freedom IS possible. We have the privilege of living in a country where opportunity is boundless. If you feel so overwhelmed with the debt on your plate, that you have no idea what to do, contact a financial advisor who can look at your situation and help you out on a one-on-one basis. If you are in this situation, now is not the time to be investing money in the stock market or saving for your kid's college fund. It's time to prioritize and eliminate this debt one dollar at a time.

Use this form from Dave Ramsey to help you keep track of your monthly cash flow. Remember, the bottom number should be ZERO. Have a plan for EVERY dollar you make.

Next time, I'll go into a little more detail about the emergency fund and why you want to have it.