The Hustle of Sistah Ant

Nosing around the internet, I came up with an idea for Christmas presents that I think I would enjoy giving.  Rice-pack comforters.  They are little pillows stuffed with scented rice that you can heat in the microwave to make a heated compress, or in the freezer to make a cold compress.  When you warm it up, you can smell the essential oil inside, and it’s like aromatherapy.  They’re easy to sew together and inexpensive to make.  Every year, I only get presents for my parents and my grandmother, but I always have others I’d like to give a present to, and I always feel cheap and selfish because of it.  I figured that I could make a dozen or so of these comforters and give them out as a handmade "love-you" gift.

Excited about my idea, I told my mom about them, and she just deflated my little balloon.  To her, the idea sounded cheap and stingy.  Her thought was, "It’s Christmas.  You don’t have to save money all the time."  She added that my family members at times have spent money on me out of kindness and I could at least return the favor.  According to her, maybe I thought that way of thinking is the reason why she doesn’t have a big house (she admittedly goes into debt for Christmas every year), but sometimes you should just get off of your money and give to others.  I was so let down by her response.  But I defended myself.

Just because I am trying not to spend the money I’m trying to save for my house all on Christmas gifts does not mean that I’m being cheap.  I like the idea of giving handmade gifts.  When you give them, people who love you appreciate them, because they take time and effort and because the gift was made especially for them.  My grandma loved the hat and scarf set I crocheted for her last year.  I have a rice pack comforter, and I LOVE it, and I think my aunties and cousins would not only like them, but get some use out of them too.  I told her about wanting to be more generous than giving just to my parents and grandma every year, and that I don’t care if people see me as cheap for giving inexpensive gifts.  My job isn’t to impress anyone.  Spending money doesn’t equal love.  I have faith that my loved ones will understand that.

By the end of my gently given but indignant defense, my mom agreed that I have some good points.  Her attitude backed off, and she said "Well, do what you want."  A little more talking, and I got her to realize my heart is in the right place and my priorities are good.  Once again, I think she’s just worried that I’ll become some despised miser who puts money above the important things in life.  I think she’s worried that I’ll lose balance.  But I see money as a tool to achieve the quality of life and stability needed to truly enjoy my time with family and friends.  Besides, where did she think I was going to get the fabrics, thread, essential oils, and rice from, the sky?  I’ll be spending something.  Plus, at her suggestion, I might make some more hats and scarves and mix it up so everyone doesn’t get the same gift. 

She wouldn’t think I was cheap if she knew I was getting her a $150 MP3 player and car adapter this year, would she?  And for the record, I don’t think there’s anything wrong with the size of her house.  I’m more worried about the size of her retirement fund, which she should be worried about more than what people think of her gifts at Christmas.

I love my mom.  I wish we thought more alike when it comes to money, though. 

I have to keep reminding myself about the fees that I’m paying on my bank account, and how I won’t have to pay them with my credit union account, because this transition is getting on my nerves.

I get paid with direct deposit, so until my changes go through payroll, I have to write a check from my bank to my credit union to have my money where I want it.  Then I have to check with the companies that have been electronically taking their payments out of my account (i.e. the government for my student loans, because you get an interest rate discount that way, and my insurer, because I get a discount that way) to find out if they are still scheduling a transfer from my bank, or if they’ve made the transition to my credit union.  That way I can make sure the money is where it needs to be. 

I can’t close the bank account until those things are no longer in limbo.  Then, and only then, will I not have to write checks to myself, confirm scheduled debits, and continue to wait to use the minimum deposit I have at the bank.  I hate switching banks - I’ve done it before and it’s a pain in the neck if you have any type of deposit or debit automatically set up.  But, since I hate waiting in line for tellers, and I hate fees and missing out on discounts, it’s worth having the auto transactions, and it’s worth the move.

I can look at it this way:  at least I’m not dealing with the check-cashing/bill-pay/fee-your-butt-to-death places with rotten customer service, dingy bullet proof glass and not-so-savory clientele.  It’s nice to have options. 

It’s just burning a hole in my pocket!

I wish that instead of my landlord telling me that I only had to pay half of October’s rent, he hadn’t told me anything.  That way, I’d still be pinching pennies without missing a beat.  But it’s extra harder now, because that’s over $300 of money from my next paycheck.  I’ve already spent almost half of it on furniture for the apartment, but that’s a legitimate expense.  Certainly more legitimate than some of the other stuff I wanna do with it - eat out… buy about five CD’s… go accessories or shoes shopping…  But what I really want to do with it is apply it towards paying off my old credit card debt.

After work yesterday, I did allow myself to buy a CD.  Working right near the mall just made it too easy.  Jill Scott’s The Real Thing Words and Sounds Vol. 3 came out yesterday, and instead of waiting for it to go on sale, I went right to the CD store and bought it.  Not the just the CD, either.  The Deluxe Limited Edition, complete with DVD and a different cover.  (I’m like her biggest fan.)  You know that cost me over $20, right?  I didn’t even go to Cir.cuit City where I knew it would be $5 cheaper.  I just went to the closest CD store, hunted down my CD, and pulled out the card.

But I am SO OKAY with my purchase.  I would SO do the same thing.  I have no buyer’s remorse, and it’s not just because I like the CD.  It’s also because in the grand scheme of things, I am good with my money.  I worked hard to get to where I am.  I deserve to be able to buy something as simple as a CD because I am paying my debt back and I’m doing it well.

Now maybe I shouldn’t be getting that other stuff… which is why I’m won’t be getting it.  If I have to sit on my hands until payday, I’ll do what I have to do.  But dang it, it feels like this money is burning a hole in my pocket. 

By the time I’d settled down to register for participation in my company’s 401K, I had already read about such things as risk tolerance, diversification to avoid having all my eggs in one droppable basket, the difference in risk between stocks and bonds, fees, and allocating my assets so that my performance would address my goals.  I’d played with a few calculators for risk tolerance and asset allocation.  I’d refreshed my memory on the various types of stock that are commonly recommended to include in a diversified portfolio.  Basically, I knew more than I thought I did.

I was able to register online.  It was a little intimidating at first.  There were about 16 funds to choose from.   However, there were various resources right there for me to use.  First, there was an earnings sheet, detailing all kinds of information ranging from the fund’s trading symbols to the expense ratio (reflecting fees coming out of your money) to the return percentages for the past year (or three, or five, or since the fund’s inception).  I used this to look up Morningstar ratings, compare fees, and compare returns.  There was also a summary of each fund’s purpose and holdings strategy.  It was wordy and technical, but it helped me get the gist of each fund as follows: "stock," "bonds," "international," "playing it safe," "risking for reward," etc.  Finally, I could look at each fund’s prospectus by clicking on its name and seeing its major holdings for myself along with other information.  To be honest, I didn’t read every word of every one.  But I read enough to understand what the funds do and feel comfortable with choosing them. 

I went mostly with index funds because I’ve heard such good things about them - lower fees, decent returns, good diversification.  I tried to avoid the funds with the highest fees and the lowest returns.  I also tried to get a good mix of small caps, large caps, international, etc.  It was good to see that a lot of that diversification work was already done in some of the funds.  I went with an 80% stock/20% bonds split, and the stock funds I chose lean towards more aggressive growth investments because I’m young and I can use the boost (and risk taking some loss on the chin).  I flirted with 85/15 and 90/10, but I more I read, the more I punked out.  I am still debating that decision.   I’d say it took me a couple of hours - I started not long after my wake-up bowl of cereal and finished shortly after lunchtime.

I’m happy I registered.  My deductions will start next month.  I’m contributing 6% myself, and my company will match 3%.  I’ll try not to be a nut and check its performance every day or every time the market shoots up or drops down - I don’t need that headache, and if I wanted that, I could be day trading.  I have automatic account rebalancing and I also have a financial advisor’s number (somewhere).  I hope my 401K serves me well.

It’s been a big weekend for my wallet.  This is long, so if you want to read the short version, just read my blue text.

If your bank starts acting up, switch and take his friend your credit union

First, I took some time Friday night and Saturday morning to do a little housekeeping.  First, I took care of my transition from my bank account, which I plan on closing, to my credit union account.  A quick review: my bank requires a $200 minimum balance if I want to avoid $19 of fees, yet they offer only nominal interest payments on my deposits.  That’s hot garbage - I’ve decided to go to the credit union.  Thing is, I had to switch some automatic debiting from my bank to the credit union before closing the account, so I did that Friday night.  Then Monday morning, I changed my direct deposit to the credit union account as well.  The bank account will stay open until I see that everything is going where it ought to go, from my paychecks to my auto insurance payments.

Will you my check still love me tomorrow? 

Next on the agenda was navigating 401K land.  First, I decided to figure out how a 6% bi-weekly contribution would affect my net pay and spending/saving ability.  I took a check stub and calculated my withholding, first by calculating the percentages withheld on my current check stub, and then by subtracting 6% of my gross pay out before using the same percentages to figure out and estimate  what my withholding would be with the retirement contributions.  Total damage per bi-weekly check - $39.  Not scary at all.  But then I went a step further and figured out how much I’d have to deduct in order to automatically divert 4% of my gross pay to my savings account, and made this change Monday morning.  That came to about a $60 per check difference between now and when my 401K contributions start.  I can live with that, knowing I’m saving/investing 10% of my gross pay on every check without even thinking about it.  I can still afford my bills and massive debt repayment with the changes.

Get ready… for the big payback 

Then I went to the IRS’ withholding calculator to make sure that I wasn’t giving the government too much of my money that I can be using now.  Since the 401K and some educational expenses are reducing my tax liability, I am now overpaying the government by an estimated $500.  However, since it’s just about October, I decided not to change my withholding again.  (That’s part pragmatic laziness, and part not wanting our accountant to get sick of seeing me in her office.) 

They jinglin’ baby… go ‘head baby

My favorite part of Saturday morning was signing up for my very first 401K and picking out a portfolio.  In one or two pay cycles, I will officially be an investor!  Yay!  My portfolio includes 80% stocks and 20% bonds, mostly in index funds with holdings ranging from government bonds to international stock to domestic stock of different sized companies.  It may be a little conservative, given my age, but this depends on who you ask.  I’m still weighing aggressiveness against risk, and I’m still trying to have confidence in my own decisions.  I didn’t ask a financial advisor for help (that’s part not finding his number, and part wanting to get this show on the road without setting up an appointment, etc.), but I’m not totally against deciding to ask for help - if I decide to do so, I can change my portfolio when I want.  I also set it to rebalance my asset allocation automatically every 6 months.  I think maybe I should change that to once a year.  Not sure yet.  Explaining how I did this will have to be another post entirely.

After that, I just smiled for about five minutes straight and basked in the happiness of having completed an important task (well not exactly completed - I have to fill out my beneficiary form).  Then I balanced my checkbook and checked in on my credit card spending to make sure it doesn’t exceed my checking account balance (it didn’t).

Got me workin’ workin’ day and night 

Last thing, I promise (I told you this was a big weekend).  I did a no-no that I think will be OK.  My honey and I went furniture shopping (all. freakin’. day.) to help us with storage so we can both fit in his our apartment.  I spent money on my credit card that I don’t currently have in my checking account.  I did it based on the fact that my landlord is prorating my last month’s rent, so the money for this furniture is to come from that savings.  So I should still have a zero balance at the end of the month on my card.  I also bought gas, food, and did laundry this weekend.  I’m tired of spending money.  Tired!  And I hate shopping (for furniture or anything else).  So, I’m glad that’s done.

I don’t want to think about money ever again.  (At least until I get paid later this week, ha ha!) 

Nobody told me that I was going to have to choose the investments in my 401K and decide how to balance it.  Silly me for thinking that it was something simple, like shares in one mutual fund.  After doing some research and playing with risk tolerance estimators, I realize that I’ll have to actually do some research, get down with some prospectuses(… prospecti?… prospectus’s? LOL!), investigate fees, and take my decision seriously.  And I already know that even then, I’ll want some reassurance that I’m doing the smart thing and my choices appropriately address my goals.

So I think it’s time to call that financial planner whose contact information I’ve been holding on to for such a time as this.  I’ve been putting this off because I didn’t want to spend time or money on service that I can provide for myself.  I have always been a do-it-yourself-er, when the task is something I can do to my own satisfaction.  It wasn’t hard to figure out that I need to reduce my high interest debt as quickly as possible, start saving regularly, and reduce my expenses.  I didn’t need a financial planner for that.  But properly balancing my 401K is another level of finance.  I’m ready to learn how to do it on my own - I’ve already started learning.  But I’m not so cocky about my ability to learn that I’m going to make my choice based on my unprofessional, inexperienced judgment alone.

Now I just have to find his number… 

Financial things on my mind lately:

I sure hope I can lift up my salary at least by 10K in the next 6 months…

I really want to start investing.  Now.  But I think it’s better to wait until I’m out of credit card debt.  I just want to increase my assets - it’s great that my liabilities are shrinking, but my assets need to grow too.  Speaking of which…

I have to sit down and reconfigure my paycheck, given next month’s new 401K contributions… I need to hit up the IRS’s withholding calculator and decide how much I feel comfortable diverting directly to my savings account once the change happens.

It’s good that I’ve set up my bill pay, but I still have to have my auto debits for student loans,  insurance, and EZPass switched to my credit union account so I can finally move my direct deposit there and dump my stupid $200-minimum-but-we-won’t-pay-you-interest bank.

Dang.  Bus token prices are going up.  Gotta figure out how or if I should change my transportation withholding. 

Time to start Christmas shopping.  I hate malls after Thanksgiving.  I have no idea what I’m getting anyone (except my baby), but if anyone asks me what I want, it’s cold hard cash for next year’s down payment on the house.  I’d like to make gifts, but there’s only so much crocheting/knitting my fingers and attention span can take.

I wonder if there’s an easy way to make money on the jackets, suits, dresses and shoes I’ve decided I’m not keeping anymore since I never wear them and probably never will again.  (I hate holding on to stuff that just takes up space for no good reason.)

Sheesh, I haven’t put anything to the side for the wedding yet.  I should, huh?  I will, just… I’m doing so many other things right now.   

Good news!  My best friend and I were talking last night and she has decided to clean up her credit!  She wants to bring all her current bills to zero balances, rehabilitate her overdrawn credit union account, and then set about the task of combing through and resolving the accounts in her credit report.  I am so very happy for her!  My friend says that with a budget, she should be able to make it happen.  She told me it’s not just about having lost a job because of bad credit.  It’s also about wanting to move on with her life and "be an adult," as she says.  She doesn’t want to keep staying in a one-bedroom apartment forever.  It’s harder to do anything - find a new apartment, turn on utilities, make plans to replace her degenerating car - without good credit.  I am happy she is seeing the light.  I encouraged her, suggested that she build an emergency fund as soon as possible (so that she’ll have money to use in a pinch without derailing her plans), and told her that she needs to just keep going even when it gets rough.  I told her about my own issues with debt repayment: how things started to get better once I was able to not have to use a credit card to get me out of a jam, how saving reserves made all the difference, how small successes keep me going.  I told her I remembered how well she was doing before the baby came, and how I used to cheer her on - I know she can do this!  And I know she’ll be OK with some tenacity and hard work.  Just like I will be.  I’ll be there for her - we’ll be there for each other.

So I’m giving her a name on my blog - "Sistah Beginner," since she’s starting all over again.  As I get updates, you will too.  I’m going to give her her very own category, so her story will be in one place, and in fact, if you’re not familiar with the parts of her story I’ve told so far, those are are in her category.  Maybe, if she’s not mad that I’m anonymously putting all her business on the internet, I can get her to guest blog?  We’ll see. 

all. my. friends. love the cheap shopper.
(doo-doo-doo, doo da-doo-doodoo)

the cheap. shop. per. is a cute dresser.
(doo-doo-doo, doo da-doo-doodoo)

doo-doo-doo-doo-doo-doo-doo.

doo-doo-doo, doo-doo…

‘Scuse me for singing this morning, even though it’s good that I feel like singing, seeing as how I am getting over a sickness that had me laid out and internet-less yesterday.   Stupid weather changes.  My sinuses got all confused, leaving me wide open for my sweetheart’s cold.  We went to visit his mom over the weekend (my EZPass deduction should hit me in about, oh, a week), and we had a nice time.

I am proud to announce that my future mother-in-law took me shopping for work clothes and I spent $55 guilt-free at the AJ.Wright ($47 plus NY tax).  I got three pair of slacks, a blouse ($1 off b/c of a snag we fixed later), and six pairs of socks, which I really needed (you know how the socks thin out around your big toe after a while, as if a hole is on its way).  I wanted some blazers and more blouses, but the place was so picked over I couldn’t find anything I liked in my size.  Oh well.  I told myself that I could buy $100 worth of things, so perhaps I’ll stop by the R.oss after work and find $45 worth of more stuff (shopping in Philly’s city limits is tax-free year round). 

This is the first time I’ve been shopping in calendar year 2007.  I just couldn’t hold out any longer, and it’s within my means.  I’m proud of myself - it’s about time.  Today I’m wearing one pair of new pants with a pair of my new socks and a sweater I have from last year.  Outside of looking like I should be sleeping off the pleurisy in bed somewhere, I look good today.

This is just a note of gratitude for my financial state.  I believe this life is because God has blessed me.  I believe my job is to be a good steward and use my wealth to be a blessing to others.  Right now, I am almost $80,000 in debt.  But I am blessed.  I’ve been paid, and with that money, I’ve paid everyone I owe money to this month.  I am not in arrears on any account I have.  No one is calling me, intimidating me, trying to get me to pay them something I owe them.  My utilities are not at risk of being shut off.  My refrigerator and cupboards are full of nutritious food.  I can afford to go to the gym and keep my body in good health.  I don’t have to ask my family members to help me carry my expenses, even though I know they would if I ever had to ask them to.  My clothes are clean and pressed, and I have enough to mix and match so that I’m not embarrassed at work.  I have a job!  In a matter of weeks, I’ll be able to start saving in a 401K for retirement.  I am paying my debt by leaps and bounds - with hundreds of dollars at a time.  And still I have money left to go to the beach or visit relatives, or like yesterday, eat tacos for lunch!  I am blessed.  I can dream about paying off debts, about accumulating savings, about buying a home of my own, about being an asset to a happy marriage, about raising healthy, happy, intelligent, inquisitive children…  I believe I can live my dreams.  Not everyone can say these things, and but for the grace of God, I wouldn’t be able to, either.  This is a good life - a very, very, good life, and I am rich.  Almost $80,000 in (shrinking) debt, but rich beyond measure.