The Good Life on a Budget

Out of Sight, Out of Mind

Have you ever dug into the back of your closet, pulled out a shirt, and said to yourself, “Oh man, I forgot I had this!” ? It’s amazing how easy it is to forget about something just because it’s not right there in front of you. The same thing can happen with your finances. If you stop thinking about them, the budget and frugality can slip your mind. Sure, you think you’re doing OK, but then you finally sit down and look at the numbers and realize you weren’t being so frugal after all.

In the spirit of honesty (and accountability), this just happened to me. We’ve been spending too much money recently, simply because we weren’t paying attention. Then when I look at the debt figures I wonder why they aren’t lower. Well, duh!

First I got bummed out and beat myself up a little. Back when we started this journey in 2006, I was so gung-ho about the whole thing and recently it’s lost its luster. Then I realized that there are just going to be times when things are slightly less frugal. For better or for worse, the point is to spend less money overall, not just every day. And when I look at our net worth over the past 3 years, we are in the best financial state then we have ever been. Our incomes are very good, our credit card debt is almost gone and, most importantly, we are aware of our finances and have goals. Even though we had more money in the past, we are much better off now.

To get the ball rolling again, we are going to follow these steps:

1. Re-evaluate the Budget. Part of our problem could be that we have outgrown our budget, or that we are under budget and the money is being frittered away. We need to look into the details.
2. Follow the Budget. Sounds simple, doesn’t it? Yet I find us eating out more and buying more things we don’t need.
3. Create a Christmas Plan. It’s that time of year again and I don’t want it to derail our plans. We don’t have money put aside for Christmas, so we’ll need to figure out where it’s all coming from. This will be posted within the next week.
4. Re-motivate. I’m currently working on that by re-reading The Total Money Makeover. My husband is planning on reading it too, which will get us in good state of mind.

Nothing left but to get to it! Here’s to a great November!

The Book Challenge

A few weeks ago, I came home from a bad day at work. I was telling my husband about it, and he suggested that I read a book that he has read many times, The 48 Laws of Power by Robert Greene. He’s suggested the book before, and I have always put it off ofr lack of time and lack of interest. This time, though, he made me an offer I couldn’t refuse. He told me that I could pick out a book for him to read. Since my husband isn’t really into personal finance, I knew where to start.

I wanted to pick a personal finance book that I enjoyed and really learned from. In about 2 seconds, I knew what I wanted - The Total Money Makeover by Dave Ramsey. Like many more before me (and hopefully my husband after me), the book changed the way I think about money. I first read it in the fall of 2006 when we were beginning our debt reduction, and it really helped us get started when things weren’t looking so bright. Now that my husband is planning to read it, I decided it was worth the money to buy so we could use it as a reference for years to come.

I can’t wait to see my husband’s reaction - and to read it again myself. What book would you recommend to my husband?

Frugal Food Friday - 6 Ways to Save on Meat

It seems like every time I go to the grocery store the prices are going up. Now, more than ever, I need to work to keep my grocery bill low. One of the biggest money pits is meat. Here are the strategies I hav been using to keep meat from busting my budget:

1. Only Buy Meat On Sale. Every week one or two meat will be on the front page as a “loss leader”, where the store actually takes a hit on the price in an attempt to bring people into the store. These are the meats I buy, then plan my menu around.
2. Know the Good Prices. This comes from experience, or by creating a price book to keep track of the lowest prices. For example, I know that the best price I can get boneless skinless chicken breasts is $1.99/lb. They are on sale for that price once or twice a month, and that is the only time I buy them.
3. Your Freezer is Your Friend. When you find a good deal, buy enough meat for a few meals. Once you bring it home, separate the meat into single use portions and pop it in the freezer. My husband is not a fan of frozen meat (he says it tastes funny), so I freeze it in marinade to prevent the meat from drying out. As the meat thaws, the marinade penetrates the meat and keeps it nice and juicy.
4. Be Creative. It can get a little boring when you buy a large value pack of meat and try to eat it all before it goes bad. To mix it up, I put the leftovers into an entirely different meal, such as chili, quesadillas, stir fry, or tacos. This keeps leftovers from being dull.
5. Experiment with Cheaper Cuts of Meat. Often the less expensive cuts of meat are tougher or more difficult to prepare. A great way to get around this is by using a slow cooker, which can tenderize the meat. One of my favorites is to pop a whole chicken ($0.69/lb) in the crockpot before I go to work with a cup of water and cook it all day. When I get home, the meat is falling off the bone with juiciness, and the crockpot is full of homemade chicken broth. I separate the meat from the skin, bones and other chicken parts and use it in tacos, chicken salad and soup.
6. Don’t Buy Lunch Meat. At $7.99/lb, I skip it except for the rarest of occaisions. I pack leftovers for lunches most days.

What do you do to save money on meat?

Health Insurance Savings Over $2000

My husband switched jobs a little more than a month ago, and one of the perks of his new job is the amazing benefits package. Aside from 3 weeks vacation (woo!), his company completely covers health insurance premiums. 100%. And the health insurance company is Harvard Pilgrim, which we had a few years ago and LOVED. So we jumped all over this and signed up immediately.

I was a little nervous to cancel my health insurance, because I thought I would have to jump through hoops. My company has Open Enrollment every January, but I didn’t want to wait 3 months (and have 2 health insurances). Fortunately, a spouse gaining coverage counts as a “qualifying event” for my health plan, so I was able to cancel my coverage. (Other qualifying events included spouse loss of coverage & new dependent.) All I had to do was fax in a form and a letter from Harvard Pilgrim stating that we had new coverage.

As soon as it was officially cancelled, I calculated my savings. Every paycheck I pay $89.76 for my health insurance. This doesn’t include dental or vision insurance, but I am keeping those with my company for the time being. I get paid every other week, or 26 times a year. Thus, over the course of a year, we will save $2333.76! Now, if I got lazy and waited until January to cancel my health insurance during Open Enrollment, I would have paid another $538.56 before 2009. That money sure will come in handy for Christmas debt payoff!