We may not have a lot, but at least we have each other

Sep
02

While explaining our credit card debt, I mentioned how we went on vacation instead of using that money to pay off our debt.

Eric and I had a very small wedding in my parents’ backyard. The only thing we paid for ourselves was our wedding rings, and our three-day honeymoon to a local vineyard. Eric’s parents invited us to join them in Kauai at their two-bedroom timeshare. Having never been to Kauai, I jumped at the chance. We paid for our airfare, most of our meals, and a boat tour but we saved a lot of money by not having to spend on accommodations.

I believe there are a lot of physical things worth sacrificing in order to be completely debt-free, but traveling and sharing new experiences is not one of them. I don’t believe that you should take a luxury-filled $20,000 trip to Europe unless you have the means but this was something small Eric and I could give ourselves. I believe it was a small price to pay for the amazing experience we got out of it.

We may not have had a lavish extravagant wedding, but we definitely had an amazing time in Kauai and I got to spend some quality time getting to know my in-laws better. I believe trading material wealth and even going a little into debt is worth the price of traveling somewhere new. In the future, I hope to save money before going on trips but I didn’t think we could pass up on this opportunity.

We continue to cut back on other areas of our life so that we can afford to partake in these life-rich experiences.

What is something you are willing to splurge on?

Tags: budget, family, Finances, love, marriage, Newlyweds, southern california, vacation

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Sep
01

September Goals

by newlywedsonabudget

A new month, a new start.

Here is a rundown of our September goals

Increase savings back to $2,000
No grocery shopping (or as little as possible except for staples such as eggs and milk). We hope to just eat what we have in our cupboards and fridge since we’ll be moving at the end of the month anyway.
Cut credit debt to $3000 (don’t really know if this is possible, depending on when Eric will get paid from his new job).
Finally receive payment from freelance check ($650!) and flexible spending account check ($150!)
Lose weight–> Eric and I are both on “diets/fitness regimes” His goal weight is 205, mine is 140 by Oct. 1

We’ll check back in Oct. 1 and see how we did.

Tags: Budgeting the Bulge, Finances, goal, marriage, Newlyweds

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Aug
30

Credit Card Crunch

by newlywedsonabudget

Here’s the thing about credit card debt. You can spend, spend, spend and have all these shiny glittery new things, but at the end of the day, the money has to come from somewhere. And if you spend, spend, spend, eventually you will be broke, broke, broke, because not only does spending beyond your means mean that you will have less money to spend later but it also means you’ll have less money to save.

By far, one of the worst financial predicaments you can get yourself into is credit card debt. And this is where I introduce ours.

From June to July, we had an uptick and actually didn’t pay off any part of our credit card debt. This was due to the vacation we took to Kauai. Obviously, people who are broke and in debt shouldn’t be taking vacations–but, we’ll talk about that in another post. Since June, we’ve paid off almost 1273.92 toward our debt. Averaged over four months, that’s only about $300 a month. Not too great.

However, if you only average over three months, and count only when we actually started working toward paying things off, you’ll see we’ve been averaging $424.64 a month. If we continue with this trend, it will take more than NINE MONTHS to pay off our debt.

That is just NOT okay. Our goal of Christmas time is looking very lofty, but I would like to be out of debt in SIX MONTHS at the latest. I would love to celebrate our first wedding anniversary without an ounce of credit card debt to our name.

We have a couple of upcoming changes that may make it difficult or easier to reach our goal.

Making it Easier

We will be moving in October, and hope to save $250 in rent and utilities–> putting the extra money into debt.
We will be cutting cable, giving us an extra $100 to put toward debt
We are expecting a $650 freelance check, to go straight toward debt
And another $150 check, also straight toward debt

Making it Difficult

We will be moving, and will have to take money out of our savings for a deposit, plus moving costs
Because of the move, we may have to pay a pet rent or deposit (something we don’t currently pay)
Eric is getting a new job and we are unsure if his paycheck will be more or less, and he may not get a paycheck for the first month
Our current apartment comes with a television but when we move, we may have to buy a TV, or we may go without one for as long as possible–we’ll see when the time comes

To make it to our six-month-goal, we have to average a monthly payment of $634. WITHOUT adding any extra onto our cards. Can we do it???

I sure hope so.

Tags: credit card, financial, husband, marriage, Money, newlywed, relationships and money, saving

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Aug
29

Simple Cutbacks, Big Savings

by newlywedsonabudget

Saving money when you’re already on a very tight budget is like saying no to an Oreo when you’re on a diet. It’s almost impossible.

Eric and I talked briefly about our finances before we got married. I knew he had some credit card debt, he knew I had student loans and a car loan, but somehow love conquers all and we’d figure out the money thing along the way, right?

Back up, Sleeping Beauty. The truth is, we should have been much more vigilant about our spending habits. We should have had a budget and been secure in our careers and had a sizable savings account to fall back on. None of which we had when we tied the knot.

After spending carelessly the first two months of our marriage, we sat down and looked over our finances. We realized that we really had nothing left over at the end of the month for extras, especially if we wanted to pay off the credit cards. This led to a cutback of almost all of the little (and not-so-little) extras that we had been spending on without even thinking about their cost.

This is an overview of things we’ve cut back on

Coffee: Having to be at work at 5 a.m., Eric would purchase a cup of coffee every morning and then an energy drink in the afternoon. He also would buy lunch frequently. Now, he uses our Keurig coffee maker , he got rid of the energy drinks (which are bad for you anyway) and takes lunch most days.

SAVINGS: $50/week

Beauty Rituals: Before I was married, I would get my hair done every three months ($130), a mani-pedi ($30), an eyebrow wax ($8) and a bikini wax once a month ($50). I am now letting my natural hair color grow out, paint my own nails, pluck my eyebrows and perform my own bikini waxes ( I swear by Gigi)!

SAVINGS: $1576/year

Shopping: I used to go shopping at least once a month, and it was always hard not to spend at least $200. I have drastically cut back on my shopping, and now go to consignment shops and Target if I really need to fulfill an urge.

SAVINGS: $1200/ year

Eating out: Eric and I would would frequently order pizza on a Friday night, go out to eat on Saturday night, and order take out on Sundays. We would easily spend at least $100 a week on eating out. We arn’t willing to cut back all our dining-out options yet, but we have cut back to eating out only once or twice a month, and ordering takeout about once a month. We no longer order pizza Friday nights and instead buy frozen pizzas on sale and eat that with a cheap bottle of wine, and wah-lah, the perfect Friday night.

SAVINGS: $300/month

So far, by changing some of our habits, we are able to save ourselves a grand total of about $7400. That’s a lot of money!

Our next step is to cut our rent and utilities at least $250/month and cut our cable completely $100/month, for an additional yearly savings of $4200.

That’s $11,600 that can go toward a down payment on a new home! I could get used to this saving thing…

Tags: budget, Finances, Newlyweds, savings

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Aug
27

The Budget Breakdown

Budgeting,
Finances

by newlywedsonabudget

So we can’t talk about being Broke Newlyweds without going over our budget. And at a glance, here it is.

Our biggest expense is Rent and Utilities, totaling 38% of our budget. Typically, rent is supposed to equal 30% of your budget. Our lease is up in October and we’re currently looking to move somewhere less expensive and more affordable—-for us, anyway. Affordable in Orange County is practically an oxymoron. We’re hoping to slash our rent by at least $200 and also move to a place that includes water, gas, and trash in the rent, thereby saving approximately $250 each month.

The rest of our expenses are pretty fixed, with food and gas being our only variables, but we pretty much stick to our budget on those.We could stand to cut a little from our savings, but we usually end up borrowing a bit from that account each month anyway.

I didn’t include extra money from Eric’s waiter job. We try to use his tips and checks from that job for spending money and to pay off our credit card debt.

Our financial plan for the next few months is to pay off our credit cards. Total, we currently have $3800 on two cards, one with a 0% interest until December. We hope to have it paid off by Christmas, but that may be a lofty goal around the holidays. We try and put at least $500 toward it each month, but usually unexpected expenses such as school costs, insurance, and car registration pop up and we end up falling behind.

After our credit card debt is paid off, we want to up our car payment so we can pay that off before the final payment is due on August 2012. After that, hopefully we can put in all the extra money into a savings plan and save up for a down payment for our very first home. Since homes in Orange County are super expensive (the minimum for a small two-bedroom townhome in a nice area is at least $400,000), we need to save a big chunk of money.

As for the savings account, we don’t have anything hefty, but its always at least a couple thousand dollars. We believe it’s important to have a lump sum of cash available for any last minute emergencies. So while we may touch it from time to time simply to make ends meet, we always keep at least $2000 on hand.

GOALS

Slash Rent/Utilities by $250
Cut cable $100/month
Pay off $3800 credit card debt by Dec. 25
After credit card debt paid off, pay off car payment
Begin to save for down payment

Tags: budget, Finances, Money, Newlyweds

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Newlyweds on a Budget