Savings Challenge 2009

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October 13, 2009

Spending to Save

Sometimes you have to spend money in order to save money.  On the surface, this statement doesn’t make much sense.  However, during the past month I have come to understand what it means.  Being involved in the Savings Challenge, we have been trying to save as much money as possible.  We’ve set and re-set our budget.  We’ve cut back on dining out.  We stick to our list at the grocery store and we no longer buy things just because it’s a great bargain.  All the while, we put as much as possible into our savings account.

However, one thing I’ve learned is that just because we’re saving money in our account, we’re not necessarily “saving money.”  Let me clarify.  Like most people, we carry credit card debt.  We paid a bit above the minimum payment amount so that we were able to put more money into our savings account.  Unfortunately, in the current economy, the interest we earn is substantially less than the interest we pay.  Paying $10 a month in credit card interest to allow us to deposit an extra $5 a month in a savings account didn’t make sense to us.  We found that putting that money toward the credit card saved us more in interest payments than we would have saved if we had put the money in our savings account.  Eventually, with one less bill we were able to put the entire amount we were paying on the credit card into our savings account.  Now, we’re saving money!

Another way we were faced with “spending to save” was with our car.  We were looking forward to saving the money we were no longer spending on day care, but now it was starting to go toward car repairs.  Our car was eight years old with more than 105,000 miles on it.  It was beginning to need repairs on a regular basis.  It really wasn’t worth the amount of money we were putting into it, so we had to think about replacing the car.  We’ve always purchased used cars, but we were able to take part in “Cash for Clunkers” and were able to buy a new car for the amount we were planning to spend on a used car.  Yes, we have a car payment now, but it doesn’t affect our budget because it’s the money we were spending on day care and we still meet our monthly savings goal.   

So now you know what I mean by “spending to save.”  Definitely, make sure you deposit a set amount of money into a savings account every month but take the time to figure out where you should put this money so it’s the most beneficial.

In what ways have you effectively spent money to save more money in the long run?

--Lori

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September 21, 2009

Flourishing Through Changes

Although we’ve gotten tons of advice and have tried to prepare accordingly, the financial costs of a growing toddler have been astounding.  During the second half of this year, we’ve been faced with many costs for our growing one-year-old; from a new car seat to added day care costs due to her big appetite (she’s no longer satisfied with homemade baby food but wants the food she sees us eat for dinner!)  As costs arise for things we thought we adequately saved for, it is very tempting to fall back into our old habits and suspend saving in order to meet the (perceived) needs of the moment.

Now, when we are tempted we must remember to set an example for Aurora that will be a foundation for her financial education as she grows.  Sam and I will teach her to make a plan to deal with the unexpected, not grow discouraged and continue saving.  We continue to evaluate where we can cut costs or pay reduced prices so that we are able to pay for the things that she needs without sacrificing our savings.  We reduced our food consumption by getting quality food and portioning it out for the week (and limiting seconds.)  Instead of purchasing pre-packaged foods, we buy fresh foods that are in-season in New England and freeze the extras for the winter months.  We still seek out coupons and discounts for our toddler’s supplies and visit consignment shops and shop the clearance racks for her clothes and shoes.

What are some ways parents can save money on the costs of a growing toddler?
 
--Nicole Chevalier

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September 28, 2009

Nothing but the truth

Though not intended by the marketing department at Connex Credit Union, who thought of the Saving Challenge, I am sure this challenge has actually been several months of deep psycho-therapy for me. I have been faced to look at the following realizations:

1. Skipping a tax year payment really is a very big deal, and no, it is not easy playing catch-up.
2. Taking out loans for $50,000 (for an unfinished education) with interest, of course, did not mean anything to me 10 years ago.
3. Still having to pay off a credit card at a 15% interest rate for purchases from four, five, six years ago (and sadly, looking back, I can't recall what I even bought.)  Let’s not forget my trip to Mexico in 2006.  Ole!  
4. Thinking the only way out is to take itty, bitty, tiny, teeny steps, one dollar at a time.  The road ahead seems so very long. 
5. Knowing I will never ever spend more than what I have is my foundation of faith.  It is my financial sobriety.

My fellow bloggers, I don't see how one could continue getting themselves in deeper debt after looking at the truth of today. What you spend today adds up--- err, rather subtracts from your future financial goals.  The truth is a pair of shoes does put you in debt.  A latte does rob your retirement account.  A bargain vacation, even the best deal ever, sets you back for YEARS.  (Mucho pesos mi amigos!)

Now, I could go on about my childhood and how poor little Susie learned these careless behaviors or didn't learn the right behaviors, but that will not change a thing:  I am in a hole.  I am deep and I don't want to be here.  Truthfully, I have been in denial that I am here.  The first step was admitting I am in need of help and I want help.  This is hard.  This does bite.  The truth stinks but ignoring it is not the way out. 

I have a long way to go, no doubt, and every little step I’ve made, no matter how small or long ago, is toward progress.  I have savings, money allocated to debt that I could not find in my budget last winter and pride that I am creating positive changes.  I am excited to plan for the future and am no longer afraid of my debt.  I feel a sense of security that things will be okay. 

1. Stop.
2. Write down EVERYTHING including the bills, coffee, gas, the dollar you gave to the homeless guy and even the money you put into saving (which IS a "bill" or debit from your income that you have to budget for.) 
3. Before you spend another dime, look at where you spent the last one. 
4. Ask yourself if it is a need or want?
5. Is there an interest charge for what I am about to buy?
6. Talk to someone at Connex to help.
7. Ask someone you trust, who is wise with dollars, how they do it.
8. Be curious.  
9. You have to DO something to make changes, not just wish that things would be different or tomorrow you will do something, or think your story or things for you are different and these steps won't apply.  I thought the same way.

I was hemorrhaging my hard earned dollars to the past.  I had to stop the bleeding to heal, for my future.  Good luck.
 
Was it difficult for you to realize your spending behaviors before committing to a new saving goal?
 
--Susie

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September 8, 2009

Boring Can Be Good

Have you ever noticed within a couple there are always two distinct personalities?  Think Abbot and Costello, Lucy and Ricky Ricardo, Fred and Wilma Flintstone and Felix Unger and Oscar Madison.  If those names don’t ring a bell, how about Bert and Ernie from Sesame Street? Everyone knows those guys.  Bert is very neat, organized and has a certain routine he follows everyday day (boring.)  Ernie on the other hand is a bit messy and never knows what he’ll be doing at any given time.  A live-in-the-moment (fun) kind of guy.  Enter the Roche family.  My husband is so Bert (but not quite as neat) and I’m definitely Ernie (but not quite as messy.)

For years, my husband has told me “we need to have a routine for everything and stick to it everyday.”  BORING!  I like spontaneity.  I like variety.  I like new things.  However, I have learned that routine can be good.  It brings order to our lives and household.  Everyone knows what’s happening and when.

The school year brings routine and order to our lives—backpacks, folders and lunchboxes all in their place ready to go.  Lunches are made the night before.  Dinners are planned for the week so I know exactly what to get from the grocery store.  Homework, bath time and nightly reading are penciled in to our schedule.  School clothes are ready at night for the next morning.  We know where everything is and when something is going to happen.  No questions asked—it’s the same thing everyday.  Everything works well on a routine.

Budgeting is like a routine.  After you do it for a while it becomes second nature…no questions asked.  I have accounts for all of our bills.  I know how much to deposit each week so at the end of the month I just pay the bill.  I don’t have to worry about finding money to pay a bill.  The money is already there.  The same applies for our savings.  Every week the same amount gets deposited.  Now, I know where our money is going.

I have learned that having a routine does not mean boring.  Being able to pay our bills and save money—now that’s exciting!  One of our goals while participating in this challenge was to stop living paycheck to paycheck.  Mission accomplished!  Our income didn’t change, but our routine did.

Does the “routine” of budgeting get to you at times?  If so, what do you do to stay on track and stay motivated to attain your financial goals?

--Lori

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Savings Challenge Blog | August 2009

August 6, 2009

A Little Planning Ahead Can Lead to Big Savings!

As the summer continues, we are really becoming more and more convinced about the importance of doing research, getting multiple quotes, and asking for available discounts for products and services that we need.  Earlier this summer, our car needed major repairs so instead of taking it to the first shop we found, we got quotes from a few mechanics to compare the diagnoses and costs.  We were then able to make an informed decision about which shop to use instead of going with the first quote out of convenience.  Taking the extra time to consider our options was worth it!  We saved a couple of hundred dollars and still received quality work on our car.  Now, we always plan ahead for repairs.  When we got a flat tire on our car, we got multiple quotes for a new tire.  We went with the price that was in our budget and saved money on a quality tire.

Also, we always ask for available discounts.  Recently, we went to an outlet mall in upstate Connecticut to purchase new work clothes for Sam and I.  After Sam tried on some clothes, he asked the salesperson if they gave a discount for AAA members. They didn't but he directed us to the customer service desk of the outlet mall.  We never thought to ask for discounts from the mall customer service office.  They gave us a discount booklet full of coupons for various stores in the mall.  We went through it, looking for discounts at the stores we like.  I purchased a pair of sandals from one store, without checking the booklet for discounts.  It wasn’t until we left the store that I realized there was a coupon in the booklet that I could have used.  I was a bit hesitant to return to the store to redeem the coupon, which would only save me $3.  Sam had to remind me that $3 was still cash that we could save so I promptly returned to the store with the coupon.  It is very important to recognize that seemingly small amounts of money add up.  It’s important to take advantage of any possible discounts no matter how small the dollar amount may seem.
 
How do you plan ahead to save when making big purchases? 

-Nicole

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August 6, 2009

A Little Patience Goes a Long Way

Patience is a virtue. I’ve heard this repeatedly throughout my life. I tell my kids constantly, “If something is important, it is worth waiting for.” It could be anything—a toy, a person, recognition for a job well done, a phone call or just waiting for the right time to say something.

Usually with patience comes work, like earning money for an item, being diligent at work or biting your tongue so you don’t say the wrong thing. As a parent, I have a difficult time being patient with my children. Not so much in a disciplinary way, but in a learning way. Watching them struggle with something and not jumping in to help them is difficult for me. However, seeing them solve a problem on their own is gratifying to me and a great achievement for them.

You need to have patience in the Savings Challenge. Change takes time. Little by little I am seeing results of the plan that we have implemented. Our credit card balances have dropped substantially. I’m anxious to see the balance every month because I know we haven’t made any new charges.  Only credits for payments made should show up on the account. It’s taken a few months, but I’ve been patient and now I see the results of our efforts.

As with many people, our daycare expenses tend to increase during the summer. Since the beginning of the challenge, we started putting money aside each week to prepare for this. When I walked into the daycare and handed them a check that covered several weeks, I was so proud. As a matter of fact, the administrator mentioned that this year more than ever people are commenting about how difficult things are financially. She asked me for information about our savings tools and tips to share with other parents. 

At times, we are faced with unexpected car repairs or an appliance that needs to be replaced. Do we always have the money put aside? Not usually, but now I don’t panic. I know that even if we use our savings for something other than what is was intended, in time we can build it back up again. So, I don’t get defeated. I get patient. 

I am very proud of my family for being patient with the changes we have been making. In the beginning, it wasn’t easy to live by a set of rules that restricted us. Having enough patience to follow the plan has allowed us to see the benefits. Pizza night and movie night may happen less often, but having the patience to wait for them makes it more special.
  
How was your experience saving for any large purchases or upcoming expenses?

--Lori

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Savings Challenge Blog | June 2009

June 26, 2009

How we save big on birthdays

Every May, we find ourselves being tight with money because we celebrate Mothers’ Day and six birthdays, including Junior’s.  He decided this year he didn’t want a birthday party but wanted to invite a couple of friends out for a day of fun and sleepover for the weekend. 

The cost of a birthday party for roughly 30 guests is more than $500.  Considering we needed to purchase large amounts of drinks, food and party goodies for the kids, we were able to keep the cost of Junior’s fun weekend down to about $125 this year!  Instead of a store-bought cake, John baked a cake and I decorated it.  Instead of having a huge amount of people over for a party, we invited family only and everyone brought something.
 
This worked out so well!  We were looking for extra money and found another opportunity to save toward our goal.  I thought changing the party format would be difficult or take away from our son’s 8th birthday celebration but it actually worked out pretty well and Junior had a ball. He was able to hang out with his closest friends and have just as good of a time. We really learned a valuable lesson and will use this method for future birthday celebrations.

What have you done to save money while entertaining for birthday parties or other large gatherings?

- Jasmine
 

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June 11, 2009

Having strong family values can teach you important financial values.

Recently, I noticed my daughter was not acting like herself.  I asked her a few times what was bothering her and of course being a teenager she said “nothing.”  Well, after a few days of this she finally told us what was going on.  Apparently, during a conversation with a group of her friends at school everyone was discussing their plans for summer vacation.  When my daughter was asked about her plans she stated she would be working as many hours as possible.  When questioned as to why all the work she replied that she has to pay for her cell phone, her car insurance, gas for her car and then save as much money as possible to carry her through the school year when she doesn’t work as much. The problem occurred when one girl in the group questioned “why don’t your parents pay for all that?  Mine do.”  My daughter said, “Our family is big and we can’t afford to pay for everything.” Lastly the girl replied, “If your parents can’t afford it, then why did they have so many kids?”  This really bothered me.

Many times I have asked myself the same thing, “Were we wrong to have a large family because we’re not able to give them all the things they desire?”  The answer every time is a resounding “NO!”  We love our children.  We can give them everything they want: cars, video game systems, exotic vacations, designer clothes and private educations. However, the price for all of that is not just monetary (though we would be in huge debt.) The price for that would be losing everything we value. Our philosophy is to provide our children with a great foundation of life long values. Love of family, faith, moral convictions and monetary responsibility are just a few. If we bought our kids everything they wanted or just tried to “keep up with the Jones,” we wouldn’t be teaching our children the values of accomplishment and self-worth. My daughter takes pride in the fact that she pays her own bills. She has a sense of accomplishment and sometimes, yes, she gets frustrated because she can’t always do or get what she wants. But in time, she usually gets what she wants with a deeper appreciation because of all the effort she put into achieving her goal. For big stuff, we will usually meet her half way. She saves half and we put in the rest. In doing this we get the satisfaction of being able to help our daughter and she knows she’s done her part as well.

Being in the Savings Challenge has opened the door to many discussions about money, goals and values with people we wouldn’t normally discuss these things with.  People that have seen our commercial, co-workers and neighbors, have all shared their tools, tips, opinions, and even, their pitfalls.  It’s difficult living within your means.  It doesn’t matter how large or small your family is.  There will always be times when we wish it was easier financially.  We all should do our best whatever our values or incomes are. I’m not saying our way is the only way, or the right way.  But, it’s our way.
 
In what ways do you teach children important financial values? 

- Lori 

Comment here.
 

June 11, 2009

Take big steps toward a bright financial future by making a few small changes.

Since March, I made a few small changes that resulted in big savings like using water filters on my sink instead of paying for water delivery and dismissing my cable company because I don’t watch much if any TV at all.  Now, I’m “ahead” enough and have taken a big step by having money transferred to my savings each week.  It is a small amount set aside weekly that will be a big deal soon.   I knew if I had a larger amount of money transferred all at once, I would feel the squeeze on my budget and spend the money I worked so hard to save.  It’s sort of "psych-out" for the psyche, I know, but it works for me.  I am so excited to see my money grow.  

My student loan lender sent an e-mail to me offering a $30 bonus to open an account with a trading company.  I didn’t think I was in any position to invest in stock, but my investigation taught me that I could buy shares in the market for a very small price. Since I journal, listing everything I spend to see where it all goes, I noticed I hadn’t dined out in a while because I didn’t see it on my list.  Instantly, I thought about splurging but chose to use the money I normally spend on big dinners to match Sallie Mae’s investment offer.  Now, I am an official shareholder!  How cool is that?

A few weeks ago, I watched a super program on ABC on the topic of debt.  It was so informative and very supportive of this financial journey I am on.  It talked about credit card debt, living beyond your means, knowing where and how you spend, and how we should stop spending, start investing and save now.  Did you know that 30 % or less of your salary should go to your rent or mortgage?  The percentage of my salary that goes toward rent is even larger and this is true for most of my friends too.  Since I’ve become so enlightened about my finances, I took a big step and found a more budget-friendly apartment.  I’m proud to say, I am moving this month!   I'd be renting forever if I continued to spend so much each month to pay someone else’s mortgage.  My goal is to clean my credit and save enough to make a down payment next year.

I feel so empowered by saving, investing and being in charge of my dollars.  I wouldn’t have recognized my pre-challenge habits were holding me back.  My eyes have been opened to so many possibilities.  My financial future is exciting and I can see the security I didn't think possible.

What unnecessary expenses or luxuries can you omit to save more money?
 
--Susie
 

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Savings Challenge Blog | May 2009

This month our goal was finding extra money for savings.  In an effort to cut back our expenses and save extra money to put into our money market account, we unplugged all appliances when we weren’t using them and cut our trips to the grocery store down to save on gas.  I now try to go once a week and buy what I think will last us the entire week, instead of making multiple trips back and forth.  No more running to the store last minute to buy more food for meals.  I use what I have on hand, which save us lots of money.  I also take advantage of weekly sales and compare prices at different stores. 

The Internet has been a great source to my family and has allowed us to save in various ways.  By visiting websites like couponbug.com, I am able to download coupons that are not available otherwise, which helps us save on products we use a lot.  We also save on the cost of stamps by using online bill payment to pay bills directly from our checking account.  This move has made my husband a little disturbed since he works for the post office, but hey we have to cut and save where we can!

What is your favorite website that allows you to save by accessing coupons, Internet sales, etc? 

--Jasmine

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Also, with the birth of our new baby, Aurora, came many new expenses, such as baby food, diapers, clothing, etc.  We came up with ways to save and offset these expenses like purchasing quality diapers only when they are on sale, using washcloths primarily when we are at home instead of disposable wipes and by making baby food from fruits and veggies at home, which we make once every two weeks and freeze.  Since Aurora grows out of her clothes so quickly, we shop at consignment shops and second hand stores, as well as receive hand-me-downs that friends pass on.  If we can't find what we need for her through these avenues then we go to the clearance rack at regular department stores or baby stores.

After looking at these and other ways we can save and then reviewing our budget, we were able to set an amount that we could save safely each month.  And to make sure we are not tempted to spend it we have our savings deducted from our paycheck and put directly into our savings account. 

What are some other ways that new parents can save on items needed for their little ones?

--Nicole

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May 6, 2009

When Did Having Money Go Away (And Will It Come Back)?

I was always a really good saver…or maybe I just wasn’t a big spender.  I remember working part time at the grocery store during high school.  I had money for lunch at school, the movies, ice-skating and gas for my car.  I was so self-sufficient.  I even had a savings account…a growing one at that.  Every week, I would deposit my check minus my “spending money.”  That, in itself, is no big deal; commendable maybe, but no big deal.

The point is I had “extra money”…money I didn’t even need!  I kept five dollars in the glove compartment of my car for emergency money.  The ashtray in my car accumulated with the change from purchases.  I had a basket on my bureau filled with coins.  It seemed about every few months I would gather the coins, roll them and deposit them into my savings account.  Today however, I’m scrambling to find two quarters for the kids milk money every morning.  When did this happen?  Why don’t I ever seem to have spare change (let alone extra money)?

I started pondering this because last week my oldest son left for the Air Force and I was left with the chore of cleaning his room.  After the initial clean up of unmatched socks, old school papers, and guitar picks etc., I came across a small cloth bag.  I thought it was filled with marbles from when he was a little boy.  It was filled with coins.  Then I found another one also filled with coins.  On his shelf was a container overflowing with coins.  They were everywhere!  When all was said and done, I deposited $164 in his savings account.  All from extra change.  I, on the other hand, never have extra change to save.

Participating in the Savings Challenge has made me aware of where our money goes.  We have an allowance.  We set aside a certain amount of money each week for upcoming bills.  I think twice before I make a purchase and now I have my own spare change basket.  After a purchase, I take the change and put it in the basket.  It’s amazing how quickly my collection is growing.  Every little bit does make a difference!

How do you save your spare change?  What is the most you ever saved? 

--Lori

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May 6, 2009

Track EVERY dollar to budget effectively

So, we’re three months into the Connex Savings Challenge and what I am most aware of is how habitual spending money has been for me.  My routine of hitting the market on any random day, without thought, has stopped.  I would go to the market and see what I needed rather than taking inventory of my cupboards and making a list beforehand.
 
Last month, I started limiting my trips to the grocery store to see how I could get by with what I already had in my cupboard.  I had guests over for dinner, which was made with food I already had at home.  It was more than enough and, of course, DE-lish! 
  
Now, I make a weekly trip to the market to pick up fresh fruit and veggies. (I still have more than enough food in the cupboards.)  My “veggie need” will also cease soon, due to using my budding garden.  I hope to yield enough produce to freeze for use in the fall and winter.  I closed my garden way too early last year and will not make that error this year.
 
Also, I canceled my home water delivery and installed a purifier on my tap.  Another choice was to shut the cable off and cut my land phone service back to the minimum plan, which sliced my bill in half!
 
Tracking every dollar has been an eye-opener!  I utilize different accounts for different spending: one for business use only, for bill pay, and for food/household expenses only.  This has been great and SO easy.   Budgeting is really a cinch now.

Are there things that you have to buy frequently like food or gas?  What are some ways you could save on your frequent expenses?
 
--Susie

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