A concious decision

I went to Target today and I actually went in and got what I went for instead of anything else! In and out, and all this while in the back of mind I was thinking "Well I really need this or I really need that". I feel good about that. Also, we have been doing decent on our $400 dollars every 2 weeks budget. I still think we need to make it $500 though. With gas prices the way they are, our money gets sucked up with gas pretty fast. Plus my husband is using the "bills" account for gas instead of the "spending" account, if we had the extra $100 he could use that account for gas instead of the "bills" account!

Where We Stand: Assets

Much to my own dissatisfaction, I've finally compiled all of our assets together. I don't like the idea of including our vehicles as assets, but I've chosen to do so since they do have some value, can be sold if necessary, and there are loans against them. I'm gathering that information from Kelly Blue Book, http://www.kbb.com/. So here's what we have:

Next up: Putting the debt and asset tables together to give our actual net worth. I'll post our first one for the end of August on Labor Day! Hopefully, the spender will put something out here soon!

Where We Stand: Debt

I'm still working to get all of our account balances and what not together so that I can show our Net Worth. I use Quicken to keep all our finances in order, so I could just crap out a report with the exact information we need. But, I decided to put this information together myself, without using Quicken. This way I can compare what I have, versus what Quicken should have. Ideally, the data should be the same, but I can tell already that there are a few discrepencies between what I have and what Quicken has. For example, I'm not putting down the money we still owe the hospital for our son's birth, nor am I including the money I need to pay my school (long story) so that I can finish my degree. In Quicken, I'm tracking the money I owe the school, but not the hospital, I also don't have the full value of my wife's student loans in there, but I'm including them here. Needless to say, this means that the financial picture I'm about to give is still somewhat inaccurate. (About $4,000 off, I think). So, without further ado, here's what we owe:

Goals? What Goals?

Honestly I do not think like my husband. Sure I would love to have tons of money in savings, but in my mind saving that much money seems impossible. How are we to live the life if the bulk of our money is being put away every month? I do want to save money, I just want to live life too. I guess maybe I would just rather use my money to live now rather than later. As I sit here and write this though, that kinda sounds ridiculous! If we just spent our money now and didnt save enough I would probably end up living very megerly later in life when I should be enjoying retirement! This blog really helps me think about things. I even skipped going to get my nails done with a friend today so that I didnt use a credit card and add $25 to our $45,000 in credit card debt. Yeah me! I do however need to buy some more work clothes... this is something that will probably go on a credit card. And this is what my husband means by not planning for things and having the money to buy things we need with cash instead of credit. Ok...so after writing this my goal is to be debt free in the next 5 years!! I want my dream house.... NOW!!

Where We Stand: Credit Cards

As I’m working on some pretty spreadsheets to show our financial ‘picture,’ I added up our credit card debt. This is just the credit card debt alone, no cars, no house, no assets that are tied to these accounts. All told, we owe roughly $45,000, for nothing. We have nothing to show for the $45,000 we’ve borrowed.

Of course, there’s a TV in our living room and a computer at my desk, and plenty of other ‘things’ we spent the money on, but we could have saved for that stuff! That way we’d have it all, free and clear.

This leads to a new problem. We’ve become accustom to the lifestyle. The ability to buy what we want whenever we want it has been great. But the cold realization is that we’ve been able to buy what we want when we can’t afford it. So, in addition to having to break the habit of spending the bank’s money, we also have to curb spending even more to pay down the debt in a reasonable time. Debt sucks.

My Goals

Finally, after thinking about this for a little while, I remembered that I'd had goals already set for my financial future. These goals were several years old, so I thought I'd dust them off, revise them, and put them out here. My primary goal was a Net Worth of $1,000,000 by the time I was 35. Given the past couple of years of financial turmoil, I've revised that goal to be a Net Worth of $1,000,000 by the time I'm 40. Right now, I'm 26, so that's 14 years to sock away a million clams.

To go along with that, I plan on being debt free (except the 'secured' loans, like the mortgage and maybe a car payment), by the age of 30, which is about 3 and 1/2 years. I'll also shoot for what's a-likely-to-be-even-more-difficult savings rate of 20% of our Gross Income. By the time my spouse is working, that should be an incredibly high $24,000 per year. Even with this high of a savings rate, and if we were at debt-zero already, we'd still be short by $125,000 (assuming a 12% return). Not to worry though, if we carry that plan through until we're almost 90, we'll have about $78,000,000. Plenty to leave behind for our great grandchildren!

I won't revise my goal to a more 'practical' number, there's just no fun in that. If I set the goal to a soft $250,000, where's the motivation? We could achieve that in less than 10 years with less than half the investment. By setting my goal higher than what I can presently achieve, I'm hoping to motivate myself into finding different streams of income (and saving that income).

As I'm proofreading this, I realize that I'm using the word 'I' almost exclusively for the goals that are outlined above. I think this comes back to the fact that neither she nor I communicate well when it comes to money. We'll see what my wife puts out here for her goals, and then we will come up with a common set to work from.

Why I spend

I realize as I am sitting here at home with just the baby that I find myself thinking "do I need to go anywhere?" I am realizing that while I spend money on things we need, it is not always necessary. I am bored; this is why I am trying to find somewhere to go. Unfortunately we don't have much to do around here so going to Target is about as fun as it gets sometimes, and it's at the expense of my pocket book. At least I'm not at the mall I suppose!

On another note, our "spending" account is down to $30. We always have $400 to spend for 2 weeks and by the beginning of the second week it is nearly gone. I told my husband I think $400 is unrealistic and that $500 would be better. But, we need to just get a freaking budget....that's the real problem!!

I don't know if I agree with my husband's post about this blog being pointless. I mean it's a place to get our thoughts out and share our feelings. Look what I just did instead of finding somewhere to go! Today I will stay home and clean, but tomorrow some good friends have invited me to lunch! Should I go? I want to.... I don't see them very often. We will see.

Whats the Point?

Well, after a few posts, I've realized that there's really no point to this blog. We haven't changed anything since we started 5 days ago. And of course, the obvious reason is a total lack of real goals. We don't have a budget, we don't know where our money's going, and we're not trying hard enough to fix that. We also don't have a good list of our financial desires. Without knowing where you are, and where you want to go, you can't really achieve much. So, starting next week, I'll be putting together an accurate list of everything we owe and start working on a plan. Real numbers coming soon!

Defeating the Purpose

Here's a good example of what my wife's talking about. We're getting ready to go out to eat, again, today, for the second time. Now, we were invited to go, and unfortunately we're very weak when it comes to our meals. So, while we have a delicious dinner planned already for this evening, we've decided to go ahead and enjoy the company of others and dine out. I'm not sure what it is about eating out, but it sure has it's spell on us. I know we're not saving any time by doing it: we've got to load up the kids, drive there, order, wait, wait, (wait some more, depending on where we are), eat, pay (a lot), and then drive home and unpack everyone. We kill two hours on a thirty minute meal! It's definately not saving money (wouldn't be talking about it if it did). So what is it? Why do we like to do it so often? Any thoughts?

Doing the Right Thing...

As I was churning through my overflowing inbox of unopened mail, side projects, and stuff my daughter likes to throw in there for fun, I came across a brand new credit card that had never been activated. It was from Citi and they had issued it to replace my Zales Card that I had opened several years ago. So, what should I do? Activate It, or call and close it? I decided to activate it, at least at first. I called the number on the front of the card (I really have the activation process down), and just as I heard the distant end start to ring, I hung up.

Printed in GIGANTIC letters next to the card was a different phone number that simply said, 'If you do not want the Citi MasterCard, call and we will close your account.' I dialed the number and within three minutes, the account was closed. No one tried to convince me to stay (or activate the card), I didn't get any great credit offer, nothing, just an automated thank you and a quick disconnect. I feel pretty good.

I'll admit, I had absolutely no intention of using the card, I mean the line was only $4,000. We have too much debt to take advantage of any 0% APR offer, so we would have just wound up buying a TV or furniture or something. Even though this isn't a huge victory over our mounds of debt, it was a step in the right direction. Now, where's my ice cream...

Our Spending

My husband and I have two beautiful children. Our daughter Kaitlynn is 3 years old and our son Kaleb is 1 month old. Like many parents we aspire to give our kids the world. They deserve it! We would like to put our kids in private school, but it costs 6,000 dollars a year. And by the time our eldest goes to college at a good university it will cost nearly 190,000 dollars for a four year degree. So my husband and I have to ask ourselves, how are we going to be able to pay for all this if we continue down this path of debt? Don't get me wrong my husband and I make decent money, but we could have so much more and save so much more if it weren't for the debt. We have tried numerous things to make ourselves stick to a budget. We gave ourselves 400 dollars every two weeks to "spend", but at the end of that two weeks we found ourselves spending money from other accounts! I have to say that our biggest spending problem is eating out. We eat out entirely too much! If we could just curb the frivolous spending we would do a lot better. I have a hard time keeping track of the money I spend too. I have tried writing it down and I have tried just carrying cash, but nothing seems to work. My husband gets very frustrated with me. I am by no means out shopping for myself, I just do most of the spending for everything. My husband seems to think our relationship when it comes to the finances is more of a father and daughter one, rather than a husband and wife one. He is probably right. The other night he asked me "If I died could you handle our finances?" My answer is simple, No. I don't know anything about our finances. I have always left the saving, budgeting, and paying of the bills to him. I really need to get more involved. The truth is that it just doesn't interest me much. With everything else I do around the house and taking care of the kids I find the idea of having to sit down and pay bills exhausting!

Welcome to Spender vs. Saver!

After 4 years of marriage, my wife and I are more in love than ever, but not with our pocket books. We've spent the last four years racking up an insurmountable amount of debt. Finally, it's time to get rid of it!

There's just one problem, neither one of us wants to drastically change our lifestyles. Now, I'm not a super-penny-pincher nor is my wife a shop-a-holic, we're just two young, average Americans that want to achieve our lives' ambitions early! But, as it turns out, ambitions cost money. Money we thought we'd pay back by now. And now, it's time.

So, we're turning to the Internet. While we intend to maintain as much anonymity as possible, we're going to live a nearly transparent financial life through this blog (sorry, no account numbers). Sharing with the world our financial ups and downs will hopefully help us to make wiser decisions about how we handle our money. Not just how we spend it, but how we save it as well.

Both my wife and I will post here as we learn the best ways to spend (and save) what we work for. We're open to suggestions, and of course, words of encouragement are always welcome!