Stacking Pennies . . .

I just got off the phone with the evil cable company, and reduced my internet speed to a slower connection and cut down to the most basic cable. The most basic cable is STILL 20/mo, so later on I'll decide if I want to keep it. She did offer me 20% off my current set up, but it ended up being 20% off the non-promo rate, so it was still 90/mo. Now for cable and internet, I'll pay just 45/mo! Half price!

This will most certainly do for the summer, maybe in the fall I'll bump my cable back up so I can watch MTV. =)

Living
My biggest luxury is living alone. Perhaps if I wasn't planning on moving in 6 months, I'd rethink this. At first, I didn't consider it a luxury, but almost a necessity! If I was wiser, I would have lived with a friend--this would have allowed me to NOT buy furniture that I'm only going to have to store (my next apartment will be TINY--moving to a much more expensive area). But I do value this luxury--I love living alone. My monthly rent for a smallish 1 bdrm is $575. This is a lot, but living alone wouldn't even be an option in more expensive areas.

Another luxury is cable internet and TV. I'm working on finding a cheaper solution. I could ditch the highest speed internet, and drop down to the cheapest cable. I think that would be about 40 dollars.


Personal
I also spend a fair amount of money on my hair. Every 3-4 months (I try to stretch it to 4!) I go to the salon, get my highlights touched up, a cut, and my eyebrows waxed. With tip, it usually comes to about $150--a lot! If I didn't adore my stylist, I might be motivated to go cheap, but she is REALLY good.

Travel/Adventure
This is a luxury that I haven't indulged in much this year (quite an expensive luxury!), but it is something that I value highly and am willing to spend money on (if I have it), always. The next several years we probably will just be doing small trips, but I hope to save up for something awesome--South America, perhaps? Also we are considering skydiving this summer, which would be about 150-200!

Eating Out
I try to limit this--I rarely eat out for lunch, but I really enjoy a good sushi dinner with the boyfriend. We are addicted! Occasionally, I also buy some less cheap groceries and cook. I'm a bit of a mess in the kitchen, but I like to try.

I could most certainly cut some (all?) of these luxuries out. It would allow me to pay off my student loans more quickly. Perhaps add a bit extra to my 401k. But I allow myself them because each month, I'm still gaining more assets and reducing debt. I'm making good progress, and I have good earning potential. I allow myself these luxuries because I won't mind paying my student loans a little bit longer in order to improve my quality of life now.

I don't allow myself every luxury. I would love a new car, I wouldn't mind eating out more, I don't buy too much for clothes. I have really crappy bedroom furniture. I've been desiring a coach purse from the outlet store for well over a year, new work shoes for months, a new swimsuit since they came out for the year, and a "water pik" for a week.

Still, I could probably have less splurges on things I don't really value highly.

First, I had a minor emergency today. I scheduled an HSBC withdrawal from my checking that would have caused an overdraft if I wasn't paying attention. Stupid mistake on my part, and I had no access to cash to fix it. I found a solution, but it makes me think I should put a little in savings to cover things like this.

The main reason I don't like to keep money there is because I take issue with Wells Fargo, but I don't want to switch my checking account for a couple reasons. One, my boyfriend, sister and parents have an account there. I know at this point in my life, there should be very little intermingling of family finances, but it happens, and it's just easiest if we all have the same bank. The boyfriend and I probably will be mingling our finances increasingly. Two, I consolidated my student loans there, so I have to have an account for that, and I don't need another bank. It seems like I'm stuck with them for a few years. Anyway, thus far their customer service for the loan has been beyond awful, and the other services have been average.

Now for the new goal. I've decided is once my high yield savings account hits 6500 I want to start up a T-bill ladder. It will complicate my taxes a little, but since I pay about 8% state tax, my effective yield, based on the past week would be 5.335%. For a better week, it could have been about 6%. I'll keep an eye on the rates while that is building, because they have been dropping.

It really won't generate that much extra revenue since I'm working with just a little money, but it is something slightly more "advanced" to do with my cash savings, still pretty liquid, and will continue to work as my cash savings grows.

Now if only those rebates from this laptop would show up. Seriously, I hate rebates. This is the first major rebate I've ever had, and it's turned me off of the process.

When I first moved here, I got a deal for about 60/mo for high speed internet and digital cable with stars. After 6 months, the rate jumped to 90, and I figured if I were to get regular cable and stars, it would go back to 60 or so.

I had been lazy and hadn't gone cheap, but today I was determined! I called up my cable provider, and said I wanted to get rid of digital cable and Stars. "Certainly! I can help you with that! But do you realize if you get rid of digital cable and stars, your rate on cable will go up?"

"No... What??"

Apparently, I'm *still* on a promotional rate, just a "lesser" promotion! Are you kidding? I don't consider 90/mo reasonable, much less promotional! It would be MORE expensive for me to get rid of digital cable and stars than to keep it for the remaining two months. WOW.

"Family cable" would cover any channel I watch (2-72) plus more, and would be about 50 a a month. Internet would be 45/mo. The cheapest cable is 16 a month, but only covers 2-22--most network shows, but not the other stuff I watch. I forgot to ask if they offer an lower speed cheaper internet. Probably not.

I'm going to have to do something differently, these rates are ridiculous. I'm not opposed to DSL, and maybe I could just get NetFlix and start watching movies instead of cable.....

I'm outraged. Maybe this means I should invest in cable television and broadband companies. =) Someone is making a killing here.

I recently set a June 22nd "in the black" goal.

I also want to talk about my goals for the year. My original (financial) goals were as follows:

-Open Roth IRA and contribute 3000 over the course of this year
-Contribute 10-15% of pre-tax dollars to 401k
-Save 100/wk in INGDIRECT account
-Pay at least 200/month on student loans

My updated goals are as follows:
-Max out Roth contributions at 4k
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Save 150/wk in HSBC account (switch banks!)
-Pay 250/month on student loans

And the "reach" goals, that I don't even know if are possible:
-Max out Roth contributions at 4k (same)
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Accumulate 10k in HSBC account (about 1k extra)
-Reduce loan debt to 16k (about 2k extra)

Good luck to me!

Something I've noticed in some of the financial blogs I read is that some people who have their money "figured out" are quite arrogant about it. I notice it more so in the comments than in the actual bloggers. It's sure nice to pay your credit card in full every month and to be sitting on a pile of savings and able to live within your means. It's practically essential for happiness, I think. But just because someone hasn't been able to do this, doesn't mean they are a worse person, it means they either started in a worse position or made a series of poor decisions (or both). I applaud anyone who has their finances under control, but those who do not aren't going to improve by us judging them. Of course, I tend to be slightly liberal and fall subject to the "bleeding heart" stereotype occasionally.

One opinion I came across personally offended me, because it was essentially calling me a worse person because I didn't follow their rules. This is the opinion that advocates never taking on debt and ridding yourself of debt before investing. At first glance, that seems reasonable. However, my life hasn't worked that way, and I don't think that I did it (or am doing it) "wrong".


I understand most people agree that education and houses are "good debt", but there are those that think there is no such thing.

I financed my entire college education on student loans. Oh sure, I had jobs. They helped out, but you can only make so much money working part time and summers. Some would say that was a mistake, that I should have went to work full time until I could save up enough to afford to pay for college in cash. There are people who do this, and it is admirable. However, education was very important to me, I was always a bright student, and I knew that i wouldn't be happy if I didn't go to college. I picked a major I enjoyed that would allow me to earn a good living, and put my heart into school. For the most part, my loans were subsidized and accrued no interest until I graduated. A year before I graduated, I received a job offer of a respectable 55k + benefits in an low cost area, and took my final semester abroad. Financially, it wasn't responsible for me to go to Asia for my last semester. Still, I don't regret it. I knew that it was on borrowed money, but it was the only time in my life that I would have the time to do something like that. So I did it. I don't regret it.

Since then, I've been working on paying my debt down. I've paid about 6k so far, and have slowed down now that the interest is subsidized again (since I am taking classes part time while working). I have about 20k left. If I had waited until I could afford college, I would have wasted years of my life in a low paying job when I am capable of more.

Also, I'm investing even though I still have debt. I'm not just investing enough to get the company match--I'm investing 10% as well as maxing out a Roth. At the end of the year, I know that the 4000 I have in my Roth could be 4000 less on my loans. I think this is a good move, given the low interest rate on my loans (and no interest for now), and time is on my side for compounding interest. Even though the loans are accumulating interest each month, it isn't compounding.

Debt can be repaid, but time, you can never get that back.

This is my first month of tracking expenses and it has helped me to limit my spending--i know if i buy something, I have to record it!

Still, it's not going so well. This month I have a paycheck income of about 2700. I've subtracted out rent, planned payments to student loans, planned automatic savings to my Roth and my HSBC account, bills I already have paid and bills that will come due this month. Then I have subtracted money I've already spent. All that is left for the rest of the month for food, clothes, entertainment, gifts, etc is $311! I expected to have more!

The reasons for this are explainable. I had an auto repair this month, something unusual, of about 200. I also went on a long road trip, driving about 1000 miles more than I usually do, which increased my gas expenditure by about $80. Also, I really need to ditch the expensive cable and go back to basic!

Still, tracking this month will help me see if my savings goals are reasonable. On my salary, is it reasonable for me to be able to save 600/mo in savings, 350 in a Roth, and also pay 250/month on my loans? That is about $1200, just under 50% of my take home pay. It is tight, and I'm not sure, but that is what I'd really like to do in order to get where I need to be.

Also, the 250/mo on my student loans is arguably a stupid financial move. I took two graduate classes while working, which put me in "school status" which means that interest doesn't accumulate on the loans. It is MUCH smarter financially to throw that money elsewhere.

The reason I am paying anything on them, much less extra, is two-fold. First, I'm not interested in paying student loans for the rest of my life, despite the fact that the rate is low. It's psychological, and I know this, but I would like the freedom of not having them. The second reason is because of my boyfriend, whom I am expecting to soon be engaged to. He is fortunate enough to have no student loans, and actually a few thousand in various savings as a college graduate of just one week (congrats, T!). Debt makes him anxious, and he doesn't even have a credit card yet. After about 2 years, I think I have finally convinced him he needs one in order to have a credit history and he plans to get one soon. That explains how he feels about debt! Since we plan to unite our finances in the next year or so, I sought his opinion on what I should be paying on them, since I was considering reducing payments. I informed him they weren't accumulating interest at this time, and that I could easily put the money into my savings and my money would work for me there. He still argued to pay them off as fast as possible, so I compromised and said I'd just keep it at the same level.

I had second thoughts about my compromise, and since it is still my money and my debt, I came up with an alternate plan. I will continue to "pay" $125 out of each paycheck to the loans, except I'll funnel it into it's own separate high interest savings which will be untouchable. As soon as interest kicks in, I'll dump the money into the loan, plus any accumulated interest. Arguably, this interest could be minimal--even if I have it in there a whole year, maybe just 100 or so. Still I just can't justify paying off a 0% loan.

In the begining...
In the past month, I have been perusing through the world of personal finance blogs. I have seen some very good things from a variety of people. I briefly considered emulating some of my favorite blogs and trying to set up a site that could generate some amount income. At this point, it didn't seem like a road I need to go down, probably not worth the effort since I don't expect a large readership. There are a lot of good financial blogs out there already and I don't know if I have the time to devote to making a blog that would be truly unique. If my blog becomes wildly popular, I may change this, but for now, I did what I knew how to do--went to blogger.com and hit the ground running.

Instead, I am just going to chronicle my journey, as many others do, so I can track my progress and stay motivated.

Roughly one year ago, I graduated from college and realized that money was more difficult to manage when there was more to do than just show up for financial aid dispersement and spend the money they gave me. I started taking an interest in personal finance, starting with a "Personal Finance for Dummies" book (which really, wasn't incredibly useful) and listening to Marketplace Money every weekend (which has been useful). Then I discovered the blog world.

The college years
Let's review my situation. I did a few things right in college and a few things wrong. There wasn't a penny saved for my education (nor do I think I'm entitled to have my parents save up. It would have been nice, but they did pay for four years of a private high school). My parents helped out some, providing me with a car and insurance, along with little bits of money, but mostly, it was funded on loans.

Here's what I had going for me.
-I had $2000/yr in scholarships and went to a relatively inexpensive state school.
-I worked part time throughout college
-I lived at home for 3 semesters (for free! Thanks mom and dad!)
-I opened a credit card to build credit history, and never carried a balance
-In the later years (once I became smarter with my money), I used money I was eligible for from subsidized federal loans (0% interest) to pay back most of my "alternative loans" that I took out my first year or two.
-I didn't go on spring breaks. Though some would say I missed out, I haven't had a chance to regret it

Here's what I could have done better, had I known.
-I took summer school my first two summers and while I worked, so I didn't work full time. This allowed me to get some difficult classes out of the way (and they were a bit easier in the summer), but was a financial mistake. Not only did I not make much money those summers, I also had to take out extra loans to fund them.
-I worked jobs that didn't pay well when i could have done something better. I worked in retail when, at minimum, I could have been making much much more waitressing.
-I didn't apply for internships related to my major until after my junior year (these paid around $15/hr), when I probably could have got one sooner.
-I studied abroad. Worth every penny, but realistically probably added at least 5000 to my student loan debt, maybe more. I don't like to think about it. =)
-I didn't finish in four years, but five. To be fair, I took one semester off for an internship (paid), so it was really 4.5 years. And I could have squeezed it in in 4 had I not studied abroad. Also, few people in my major get out in 4 flat, though it isn't unheard of by any means.
-I could have spent less money (but who couldn't?)

The after effects of the college years
Here's where things stand now. My base salary is about 56k, and I'm contributing 10% to my works 401k plan and getting a match on 6% of that. I have a Health Savings Account which I'm contributing 200/month to for the first half of the year, then it will be fully funded. I decided to do that in case I needed the money for a medical expense--I wanted it to be there ASAP. I'm contributing 350/month to a Roth IRA I opened in January (but I started out just contributing 250) with plans of maxing it.

I started working in June, and paid off about 6000 of student loan debt in the first six months. The interest rate was around 8% for that chunk of non-federal loans. I consolidated my federal loans through Wells Fargo, and I must say I'm really unhappy with how the process went. In fact, it is still not complete--somehow about 5500 of debt was "forgot" in the consolidation, and I'm waiting for them to finish adding it. Perhaps I'll discuss later, but Wells Fargo has left a bad taste in my mouth but now I'm stuck with them for the life of my student loan.

I opened a savings account at INGDirect after realizing Wells Fargo was paying me .5% or so on any money I kept there. Later I switched to HSBC for their "new money" deal, and plan on sticking with it. I'm paid bi-weekly, and have 300 from each paycheck automatically deposited in that account.

Here are the numbers, neglecting credit card balance ( always paid in full) and checking account (less than 500 anyway):
Student Loans at Wells Fargo (currently at 0% interest): $14,800
Student Loans waiting to be consolidated: 5,500 (7.14% interest... thanks for screwing up WF!): $5446
Roth IRA: $1100
401k: $9057
HSBC: $4130

The numbers won't add up exactly, but this includes everything:
NET WORTH: $-6,300

Oh look, it is still red.

I comfort myself by the thought that I have roughly $2000 coming to me in tuition reimbursement (once I finish my last project) and $300 coming in mail in rebates (what a pain!) from my laptop, so that brings the pretty red number to about $-4000. But really, that money isn't in my possession yet, so I can't count it. It would be just as sneaky to count this weeks paycheck!

Changing those numbers
I'm trying to set a goal for when I'll see that number turn black, but I just recently started tracking everything, and I really have no idea how much each paycheck will affect it. Usually, I immediately see about 1300 in my checking/savings, but that doesn't include my 401k+match, which probably is around another 300 or so. I imagine it'll be very soon--within months. Today is May 09th, and I imagine it'll take at least 4 paychecks to get in the black... so let's go with June 22nd as the date to be "in the black".

What I like about this goal is that I'm allowed to arrange my money how I want to meet it. I don't have to focus on increasing my savings at the expense of my 401k, I can attack everything in a balanced manner and still see a huge overall impact.

Let the learning begin.

I just got off the phone with the evil cable company, and reduced my internet speed to a slower connection and cut down to the most basic cable. The most basic cable is STILL 20/mo, so later on I'll decide if I want to keep it. She did offer me 20% off my current set up, but it ended up being 20% off the non-promo rate, so it was still 90/mo. Now for cable and internet, I'll pay just 45/mo! Half price!

This will most certainly do for the summer, maybe in the fall I'll bump my cable back up so I can watch MTV. =)

Living
My biggest luxury is living alone. Perhaps if I wasn't planning on moving in 6 months, I'd rethink this. At first, I didn't consider it a luxury, but almost a necessity! If I was wiser, I would have lived with a friend--this would have allowed me to NOT buy furniture that I'm only going to have to store (my next apartment will be TINY--moving to a much more expensive area). But I do value this luxury--I love living alone. My monthly rent for a smallish 1 bdrm is $575. This is a lot, but living alone wouldn't even be an option in more expensive areas.

Another luxury is cable internet and TV. I'm working on finding a cheaper solution. I could ditch the highest speed internet, and drop down to the cheapest cable. I think that would be about 40 dollars.


Personal
I also spend a fair amount of money on my hair. Every 3-4 months (I try to stretch it to 4!) I go to the salon, get my highlights touched up, a cut, and my eyebrows waxed. With tip, it usually comes to about $150--a lot! If I didn't adore my stylist, I might be motivated to go cheap, but she is REALLY good.

Travel/Adventure
This is a luxury that I haven't indulged in much this year (quite an expensive luxury!), but it is something that I value highly and am willing to spend money on (if I have it), always. The next several years we probably will just be doing small trips, but I hope to save up for something awesome--South America, perhaps? Also we are considering skydiving this summer, which would be about 150-200!

Eating Out
I try to limit this--I rarely eat out for lunch, but I really enjoy a good sushi dinner with the boyfriend. We are addicted! Occasionally, I also buy some less cheap groceries and cook. I'm a bit of a mess in the kitchen, but I like to try.

I could most certainly cut some (all?) of these luxuries out. It would allow me to pay off my student loans more quickly. Perhaps add a bit extra to my 401k. But I allow myself them because each month, I'm still gaining more assets and reducing debt. I'm making good progress, and I have good earning potential. I allow myself these luxuries because I won't mind paying my student loans a little bit longer in order to improve my quality of life now.

I don't allow myself every luxury. I would love a new car, I wouldn't mind eating out more, I don't buy too much for clothes. I have really crappy bedroom furniture. I've been desiring a coach purse from the outlet store for well over a year, new work shoes for months, a new swimsuit since they came out for the year, and a "water pik" for a week.

Still, I could probably have less splurges on things I don't really value highly.

First, I had a minor emergency today. I scheduled an HSBC withdrawal from my checking that would have caused an overdraft if I wasn't paying attention. Stupid mistake on my part, and I had no access to cash to fix it. I found a solution, but it makes me think I should put a little in savings to cover things like this.

The main reason I don't like to keep money there is because I take issue with Wells Fargo, but I don't want to switch my checking account for a couple reasons. One, my boyfriend, sister and parents have an account there. I know at this point in my life, there should be very little intermingling of family finances, but it happens, and it's just easiest if we all have the same bank. The boyfriend and I probably will be mingling our finances increasingly. Two, I consolidated my student loans there, so I have to have an account for that, and I don't need another bank. It seems like I'm stuck with them for a few years. Anyway, thus far their customer service for the loan has been beyond awful, and the other services have been average.

Now for the new goal. I've decided is once my high yield savings account hits 6500 I want to start up a T-bill ladder. It will complicate my taxes a little, but since I pay about 8% state tax, my effective yield, based on the past week would be 5.335%. For a better week, it could have been about 6%. I'll keep an eye on the rates while that is building, because they have been dropping.

It really won't generate that much extra revenue since I'm working with just a little money, but it is something slightly more "advanced" to do with my cash savings, still pretty liquid, and will continue to work as my cash savings grows.

Now if only those rebates from this laptop would show up. Seriously, I hate rebates. This is the first major rebate I've ever had, and it's turned me off of the process.

When I first moved here, I got a deal for about 60/mo for high speed internet and digital cable with stars. After 6 months, the rate jumped to 90, and I figured if I were to get regular cable and stars, it would go back to 60 or so.

I had been lazy and hadn't gone cheap, but today I was determined! I called up my cable provider, and said I wanted to get rid of digital cable and Stars. "Certainly! I can help you with that! But do you realize if you get rid of digital cable and stars, your rate on cable will go up?"

"No... What??"

Apparently, I'm *still* on a promotional rate, just a "lesser" promotion! Are you kidding? I don't consider 90/mo reasonable, much less promotional! It would be MORE expensive for me to get rid of digital cable and stars than to keep it for the remaining two months. WOW.

"Family cable" would cover any channel I watch (2-72) plus more, and would be about 50 a a month. Internet would be 45/mo. The cheapest cable is 16 a month, but only covers 2-22--most network shows, but not the other stuff I watch. I forgot to ask if they offer an lower speed cheaper internet. Probably not.

I'm going to have to do something differently, these rates are ridiculous. I'm not opposed to DSL, and maybe I could just get NetFlix and start watching movies instead of cable.....

I'm outraged. Maybe this means I should invest in cable television and broadband companies. =) Someone is making a killing here.

I recently set a June 22nd "in the black" goal.

I also want to talk about my goals for the year. My original (financial) goals were as follows:

-Open Roth IRA and contribute 3000 over the course of this year
-Contribute 10-15% of pre-tax dollars to 401k
-Save 100/wk in INGDIRECT account
-Pay at least 200/month on student loans

My updated goals are as follows:
-Max out Roth contributions at 4k
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Save 150/wk in HSBC account (switch banks!)
-Pay 250/month on student loans

And the "reach" goals, that I don't even know if are possible:
-Max out Roth contributions at 4k (same)
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Accumulate 10k in HSBC account (about 1k extra)
-Reduce loan debt to 16k (about 2k extra)

Good luck to me!

Something I've noticed in some of the financial blogs I read is that some people who have their money "figured out" are quite arrogant about it. I notice it more so in the comments than in the actual bloggers. It's sure nice to pay your credit card in full every month and to be sitting on a pile of savings and able to live within your means. It's practically essential for happiness, I think. But just because someone hasn't been able to do this, doesn't mean they are a worse person, it means they either started in a worse position or made a series of poor decisions (or both). I applaud anyone who has their finances under control, but those who do not aren't going to improve by us judging them. Of course, I tend to be slightly liberal and fall subject to the "bleeding heart" stereotype occasionally.

One opinion I came across personally offended me, because it was essentially calling me a worse person because I didn't follow their rules. This is the opinion that advocates never taking on debt and ridding yourself of debt before investing. At first glance, that seems reasonable. However, my life hasn't worked that way, and I don't think that I did it (or am doing it) "wrong".


I understand most people agree that education and houses are "good debt", but there are those that think there is no such thing.

I financed my entire college education on student loans. Oh sure, I had jobs. They helped out, but you can only make so much money working part time and summers. Some would say that was a mistake, that I should have went to work full time until I could save up enough to afford to pay for college in cash. There are people who do this, and it is admirable. However, education was very important to me, I was always a bright student, and I knew that i wouldn't be happy if I didn't go to college. I picked a major I enjoyed that would allow me to earn a good living, and put my heart into school. For the most part, my loans were subsidized and accrued no interest until I graduated. A year before I graduated, I received a job offer of a respectable 55k + benefits in an low cost area, and took my final semester abroad. Financially, it wasn't responsible for me to go to Asia for my last semester. Still, I don't regret it. I knew that it was on borrowed money, but it was the only time in my life that I would have the time to do something like that. So I did it. I don't regret it.

Since then, I've been working on paying my debt down. I've paid about 6k so far, and have slowed down now that the interest is subsidized again (since I am taking classes part time while working). I have about 20k left. If I had waited until I could afford college, I would have wasted years of my life in a low paying job when I am capable of more.

Also, I'm investing even though I still have debt. I'm not just investing enough to get the company match--I'm investing 10% as well as maxing out a Roth. At the end of the year, I know that the 4000 I have in my Roth could be 4000 less on my loans. I think this is a good move, given the low interest rate on my loans (and no interest for now), and time is on my side for compounding interest. Even though the loans are accumulating interest each month, it isn't compounding.

Debt can be repaid, but time, you can never get that back.

This is my first month of tracking expenses and it has helped me to limit my spending--i know if i buy something, I have to record it!

Still, it's not going so well. This month I have a paycheck income of about 2700. I've subtracted out rent, planned payments to student loans, planned automatic savings to my Roth and my HSBC account, bills I already have paid and bills that will come due this month. Then I have subtracted money I've already spent. All that is left for the rest of the month for food, clothes, entertainment, gifts, etc is $311! I expected to have more!

The reasons for this are explainable. I had an auto repair this month, something unusual, of about 200. I also went on a long road trip, driving about 1000 miles more than I usually do, which increased my gas expenditure by about $80. Also, I really need to ditch the expensive cable and go back to basic!

Still, tracking this month will help me see if my savings goals are reasonable. On my salary, is it reasonable for me to be able to save 600/mo in savings, 350 in a Roth, and also pay 250/month on my loans? That is about $1200, just under 50% of my take home pay. It is tight, and I'm not sure, but that is what I'd really like to do in order to get where I need to be.

Also, the 250/mo on my student loans is arguably a stupid financial move. I took two graduate classes while working, which put me in "school status" which means that interest doesn't accumulate on the loans. It is MUCH smarter financially to throw that money elsewhere.

The reason I am paying anything on them, much less extra, is two-fold. First, I'm not interested in paying student loans for the rest of my life, despite the fact that the rate is low. It's psychological, and I know this, but I would like the freedom of not having them. The second reason is because of my boyfriend, whom I am expecting to soon be engaged to. He is fortunate enough to have no student loans, and actually a few thousand in various savings as a college graduate of just one week (congrats, T!). Debt makes him anxious, and he doesn't even have a credit card yet. After about 2 years, I think I have finally convinced him he needs one in order to have a credit history and he plans to get one soon. That explains how he feels about debt! Since we plan to unite our finances in the next year or so, I sought his opinion on what I should be paying on them, since I was considering reducing payments. I informed him they weren't accumulating interest at this time, and that I could easily put the money into my savings and my money would work for me there. He still argued to pay them off as fast as possible, so I compromised and said I'd just keep it at the same level.

I had second thoughts about my compromise, and since it is still my money and my debt, I came up with an alternate plan. I will continue to "pay" $125 out of each paycheck to the loans, except I'll funnel it into it's own separate high interest savings which will be untouchable. As soon as interest kicks in, I'll dump the money into the loan, plus any accumulated interest. Arguably, this interest could be minimal--even if I have it in there a whole year, maybe just 100 or so. Still I just can't justify paying off a 0% loan.

In the begining...
In the past month, I have been perusing through the world of personal finance blogs. I have seen some very good things from a variety of people. I briefly considered emulating some of my favorite blogs and trying to set up a site that could generate some amount income. At this point, it didn't seem like a road I need to go down, probably not worth the effort since I don't expect a large readership. There are a lot of good financial blogs out there already and I don't know if I have the time to devote to making a blog that would be truly unique. If my blog becomes wildly popular, I may change this, but for now, I did what I knew how to do--went to blogger.com and hit the ground running.

Instead, I am just going to chronicle my journey, as many others do, so I can track my progress and stay motivated.

Roughly one year ago, I graduated from college and realized that money was more difficult to manage when there was more to do than just show up for financial aid dispersement and spend the money they gave me. I started taking an interest in personal finance, starting with a "Personal Finance for Dummies" book (which really, wasn't incredibly useful) and listening to Marketplace Money every weekend (which has been useful). Then I discovered the blog world.

The college years
Let's review my situation. I did a few things right in college and a few things wrong. There wasn't a penny saved for my education (nor do I think I'm entitled to have my parents save up. It would have been nice, but they did pay for four years of a private high school). My parents helped out some, providing me with a car and insurance, along with little bits of money, but mostly, it was funded on loans.

Here's what I had going for me.
-I had $2000/yr in scholarships and went to a relatively inexpensive state school.
-I worked part time throughout college
-I lived at home for 3 semesters (for free! Thanks mom and dad!)
-I opened a credit card to build credit history, and never carried a balance
-In the later years (once I became smarter with my money), I used money I was eligible for from subsidized federal loans (0% interest) to pay back most of my "alternative loans" that I took out my first year or two.
-I didn't go on spring breaks. Though some would say I missed out, I haven't had a chance to regret it

Here's what I could have done better, had I known.
-I took summer school my first two summers and while I worked, so I didn't work full time. This allowed me to get some difficult classes out of the way (and they were a bit easier in the summer), but was a financial mistake. Not only did I not make much money those summers, I also had to take out extra loans to fund them.
-I worked jobs that didn't pay well when i could have done something better. I worked in retail when, at minimum, I could have been making much much more waitressing.
-I didn't apply for internships related to my major until after my junior year (these paid around $15/hr), when I probably could have got one sooner.
-I studied abroad. Worth every penny, but realistically probably added at least 5000 to my student loan debt, maybe more. I don't like to think about it. =)
-I didn't finish in four years, but five. To be fair, I took one semester off for an internship (paid), so it was really 4.5 years. And I could have squeezed it in in 4 had I not studied abroad. Also, few people in my major get out in 4 flat, though it isn't unheard of by any means.
-I could have spent less money (but who couldn't?)

The after effects of the college years
Here's where things stand now. My base salary is about 56k, and I'm contributing 10% to my works 401k plan and getting a match on 6% of that. I have a Health Savings Account which I'm contributing 200/month to for the first half of the year, then it will be fully funded. I decided to do that in case I needed the money for a medical expense--I wanted it to be there ASAP. I'm contributing 350/month to a Roth IRA I opened in January (but I started out just contributing 250) with plans of maxing it.

I started working in June, and paid off about 6000 of student loan debt in the first six months. The interest rate was around 8% for that chunk of non-federal loans. I consolidated my federal loans through Wells Fargo, and I must say I'm really unhappy with how the process went. In fact, it is still not complete--somehow about 5500 of debt was "forgot" in the consolidation, and I'm waiting for them to finish adding it. Perhaps I'll discuss later, but Wells Fargo has left a bad taste in my mouth but now I'm stuck with them for the life of my student loan.

I opened a savings account at INGDirect after realizing Wells Fargo was paying me .5% or so on any money I kept there. Later I switched to HSBC for their "new money" deal, and plan on sticking with it. I'm paid bi-weekly, and have 300 from each paycheck automatically deposited in that account.

Here are the numbers, neglecting credit card balance ( always paid in full) and checking account (less than 500 anyway):
Student Loans at Wells Fargo (currently at 0% interest): $14,800
Student Loans waiting to be consolidated: 5,500 (7.14% interest... thanks for screwing up WF!): $5446
Roth IRA: $1100
401k: $9057
HSBC: $4130

The numbers won't add up exactly, but this includes everything:
NET WORTH: $-6,300

Oh look, it is still red.

I comfort myself by the thought that I have roughly $2000 coming to me in tuition reimbursement (once I finish my last project) and $300 coming in mail in rebates (what a pain!) from my laptop, so that brings the pretty red number to about $-4000. But really, that money isn't in my possession yet, so I can't count it. It would be just as sneaky to count this weeks paycheck!

Changing those numbers
I'm trying to set a goal for when I'll see that number turn black, but I just recently started tracking everything, and I really have no idea how much each paycheck will affect it. Usually, I immediately see about 1300 in my checking/savings, but that doesn't include my 401k+match, which probably is around another 300 or so. I imagine it'll be very soon--within months. Today is May 09th, and I imagine it'll take at least 4 paychecks to get in the black... so let's go with June 22nd as the date to be "in the black".

What I like about this goal is that I'm allowed to arrange my money how I want to meet it. I don't have to focus on increasing my savings at the expense of my 401k, I can attack everything in a balanced manner and still see a huge overall impact.

Let the learning begin.

I just got off the phone with the evil cable company, and reduced my internet speed to a slower connection and cut down to the most basic cable. The most basic cable is STILL 20/mo, so later on I'll decide if I want to keep it. She did offer me 20% off my current set up, but it ended up being 20% off the non-promo rate, so it was still 90/mo. Now for cable and internet, I'll pay just 45/mo! Half price!

This will most certainly do for the summer, maybe in the fall I'll bump my cable back up so I can watch MTV. =)

Living
My biggest luxury is living alone. Perhaps if I wasn't planning on moving in 6 months, I'd rethink this. At first, I didn't consider it a luxury, but almost a necessity! If I was wiser, I would have lived with a friend--this would have allowed me to NOT buy furniture that I'm only going to have to store (my next apartment will be TINY--moving to a much more expensive area). But I do value this luxury--I love living alone. My monthly rent for a smallish 1 bdrm is $575. This is a lot, but living alone wouldn't even be an option in more expensive areas.

Another luxury is cable internet and TV. I'm working on finding a cheaper solution. I could ditch the highest speed internet, and drop down to the cheapest cable. I think that would be about 40 dollars.


Personal
I also spend a fair amount of money on my hair. Every 3-4 months (I try to stretch it to 4!) I go to the salon, get my highlights touched up, a cut, and my eyebrows waxed. With tip, it usually comes to about $150--a lot! If I didn't adore my stylist, I might be motivated to go cheap, but she is REALLY good.

Travel/Adventure
This is a luxury that I haven't indulged in much this year (quite an expensive luxury!), but it is something that I value highly and am willing to spend money on (if I have it), always. The next several years we probably will just be doing small trips, but I hope to save up for something awesome--South America, perhaps? Also we are considering skydiving this summer, which would be about 150-200!

Eating Out
I try to limit this--I rarely eat out for lunch, but I really enjoy a good sushi dinner with the boyfriend. We are addicted! Occasionally, I also buy some less cheap groceries and cook. I'm a bit of a mess in the kitchen, but I like to try.

I could most certainly cut some (all?) of these luxuries out. It would allow me to pay off my student loans more quickly. Perhaps add a bit extra to my 401k. But I allow myself them because each month, I'm still gaining more assets and reducing debt. I'm making good progress, and I have good earning potential. I allow myself these luxuries because I won't mind paying my student loans a little bit longer in order to improve my quality of life now.

I don't allow myself every luxury. I would love a new car, I wouldn't mind eating out more, I don't buy too much for clothes. I have really crappy bedroom furniture. I've been desiring a coach purse from the outlet store for well over a year, new work shoes for months, a new swimsuit since they came out for the year, and a "water pik" for a week.

Still, I could probably have less splurges on things I don't really value highly.

First, I had a minor emergency today. I scheduled an HSBC withdrawal from my checking that would have caused an overdraft if I wasn't paying attention. Stupid mistake on my part, and I had no access to cash to fix it. I found a solution, but it makes me think I should put a little in savings to cover things like this.

The main reason I don't like to keep money there is because I take issue with Wells Fargo, but I don't want to switch my checking account for a couple reasons. One, my boyfriend, sister and parents have an account there. I know at this point in my life, there should be very little intermingling of family finances, but it happens, and it's just easiest if we all have the same bank. The boyfriend and I probably will be mingling our finances increasingly. Two, I consolidated my student loans there, so I have to have an account for that, and I don't need another bank. It seems like I'm stuck with them for a few years. Anyway, thus far their customer service for the loan has been beyond awful, and the other services have been average.

Now for the new goal. I've decided is once my high yield savings account hits 6500 I want to start up a T-bill ladder. It will complicate my taxes a little, but since I pay about 8% state tax, my effective yield, based on the past week would be 5.335%. For a better week, it could have been about 6%. I'll keep an eye on the rates while that is building, because they have been dropping.

It really won't generate that much extra revenue since I'm working with just a little money, but it is something slightly more "advanced" to do with my cash savings, still pretty liquid, and will continue to work as my cash savings grows.

Now if only those rebates from this laptop would show up. Seriously, I hate rebates. This is the first major rebate I've ever had, and it's turned me off of the process.

When I first moved here, I got a deal for about 60/mo for high speed internet and digital cable with stars. After 6 months, the rate jumped to 90, and I figured if I were to get regular cable and stars, it would go back to 60 or so.

I had been lazy and hadn't gone cheap, but today I was determined! I called up my cable provider, and said I wanted to get rid of digital cable and Stars. "Certainly! I can help you with that! But do you realize if you get rid of digital cable and stars, your rate on cable will go up?"

"No... What??"

Apparently, I'm *still* on a promotional rate, just a "lesser" promotion! Are you kidding? I don't consider 90/mo reasonable, much less promotional! It would be MORE expensive for me to get rid of digital cable and stars than to keep it for the remaining two months. WOW.

"Family cable" would cover any channel I watch (2-72) plus more, and would be about 50 a a month. Internet would be 45/mo. The cheapest cable is 16 a month, but only covers 2-22--most network shows, but not the other stuff I watch. I forgot to ask if they offer an lower speed cheaper internet. Probably not.

I'm going to have to do something differently, these rates are ridiculous. I'm not opposed to DSL, and maybe I could just get NetFlix and start watching movies instead of cable.....

I'm outraged. Maybe this means I should invest in cable television and broadband companies. =) Someone is making a killing here.

I recently set a June 22nd "in the black" goal.

I also want to talk about my goals for the year. My original (financial) goals were as follows:

-Open Roth IRA and contribute 3000 over the course of this year
-Contribute 10-15% of pre-tax dollars to 401k
-Save 100/wk in INGDIRECT account
-Pay at least 200/month on student loans

My updated goals are as follows:
-Max out Roth contributions at 4k
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Save 150/wk in HSBC account (switch banks!)
-Pay 250/month on student loans

And the "reach" goals, that I don't even know if are possible:
-Max out Roth contributions at 4k (same)
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Accumulate 10k in HSBC account (about 1k extra)
-Reduce loan debt to 16k (about 2k extra)

Good luck to me!

Something I've noticed in some of the financial blogs I read is that some people who have their money "figured out" are quite arrogant about it. I notice it more so in the comments than in the actual bloggers. It's sure nice to pay your credit card in full every month and to be sitting on a pile of savings and able to live within your means. It's practically essential for happiness, I think. But just because someone hasn't been able to do this, doesn't mean they are a worse person, it means they either started in a worse position or made a series of poor decisions (or both). I applaud anyone who has their finances under control, but those who do not aren't going to improve by us judging them. Of course, I tend to be slightly liberal and fall subject to the "bleeding heart" stereotype occasionally.

One opinion I came across personally offended me, because it was essentially calling me a worse person because I didn't follow their rules. This is the opinion that advocates never taking on debt and ridding yourself of debt before investing. At first glance, that seems reasonable. However, my life hasn't worked that way, and I don't think that I did it (or am doing it) "wrong".


I understand most people agree that education and houses are "good debt", but there are those that think there is no such thing.

I financed my entire college education on student loans. Oh sure, I had jobs. They helped out, but you can only make so much money working part time and summers. Some would say that was a mistake, that I should have went to work full time until I could save up enough to afford to pay for college in cash. There are people who do this, and it is admirable. However, education was very important to me, I was always a bright student, and I knew that i wouldn't be happy if I didn't go to college. I picked a major I enjoyed that would allow me to earn a good living, and put my heart into school. For the most part, my loans were subsidized and accrued no interest until I graduated. A year before I graduated, I received a job offer of a respectable 55k + benefits in an low cost area, and took my final semester abroad. Financially, it wasn't responsible for me to go to Asia for my last semester. Still, I don't regret it. I knew that it was on borrowed money, but it was the only time in my life that I would have the time to do something like that. So I did it. I don't regret it.

Since then, I've been working on paying my debt down. I've paid about 6k so far, and have slowed down now that the interest is subsidized again (since I am taking classes part time while working). I have about 20k left. If I had waited until I could afford college, I would have wasted years of my life in a low paying job when I am capable of more.

Also, I'm investing even though I still have debt. I'm not just investing enough to get the company match--I'm investing 10% as well as maxing out a Roth. At the end of the year, I know that the 4000 I have in my Roth could be 4000 less on my loans. I think this is a good move, given the low interest rate on my loans (and no interest for now), and time is on my side for compounding interest. Even though the loans are accumulating interest each month, it isn't compounding.

Debt can be repaid, but time, you can never get that back.

This is my first month of tracking expenses and it has helped me to limit my spending--i know if i buy something, I have to record it!

Still, it's not going so well. This month I have a paycheck income of about 2700. I've subtracted out rent, planned payments to student loans, planned automatic savings to my Roth and my HSBC account, bills I already have paid and bills that will come due this month. Then I have subtracted money I've already spent. All that is left for the rest of the month for food, clothes, entertainment, gifts, etc is $311! I expected to have more!

The reasons for this are explainable. I had an auto repair this month, something unusual, of about 200. I also went on a long road trip, driving about 1000 miles more than I usually do, which increased my gas expenditure by about $80. Also, I really need to ditch the expensive cable and go back to basic!

Still, tracking this month will help me see if my savings goals are reasonable. On my salary, is it reasonable for me to be able to save 600/mo in savings, 350 in a Roth, and also pay 250/month on my loans? That is about $1200, just under 50% of my take home pay. It is tight, and I'm not sure, but that is what I'd really like to do in order to get where I need to be.

Also, the 250/mo on my student loans is arguably a stupid financial move. I took two graduate classes while working, which put me in "school status" which means that interest doesn't accumulate on the loans. It is MUCH smarter financially to throw that money elsewhere.

The reason I am paying anything on them, much less extra, is two-fold. First, I'm not interested in paying student loans for the rest of my life, despite the fact that the rate is low. It's psychological, and I know this, but I would like the freedom of not having them. The second reason is because of my boyfriend, whom I am expecting to soon be engaged to. He is fortunate enough to have no student loans, and actually a few thousand in various savings as a college graduate of just one week (congrats, T!). Debt makes him anxious, and he doesn't even have a credit card yet. After about 2 years, I think I have finally convinced him he needs one in order to have a credit history and he plans to get one soon. That explains how he feels about debt! Since we plan to unite our finances in the next year or so, I sought his opinion on what I should be paying on them, since I was considering reducing payments. I informed him they weren't accumulating interest at this time, and that I could easily put the money into my savings and my money would work for me there. He still argued to pay them off as fast as possible, so I compromised and said I'd just keep it at the same level.

I had second thoughts about my compromise, and since it is still my money and my debt, I came up with an alternate plan. I will continue to "pay" $125 out of each paycheck to the loans, except I'll funnel it into it's own separate high interest savings which will be untouchable. As soon as interest kicks in, I'll dump the money into the loan, plus any accumulated interest. Arguably, this interest could be minimal--even if I have it in there a whole year, maybe just 100 or so. Still I just can't justify paying off a 0% loan.

In the begining...
In the past month, I have been perusing through the world of personal finance blogs. I have seen some very good things from a variety of people. I briefly considered emulating some of my favorite blogs and trying to set up a site that could generate some amount income. At this point, it didn't seem like a road I need to go down, probably not worth the effort since I don't expect a large readership. There are a lot of good financial blogs out there already and I don't know if I have the time to devote to making a blog that would be truly unique. If my blog becomes wildly popular, I may change this, but for now, I did what I knew how to do--went to blogger.com and hit the ground running.

Instead, I am just going to chronicle my journey, as many others do, so I can track my progress and stay motivated.

Roughly one year ago, I graduated from college and realized that money was more difficult to manage when there was more to do than just show up for financial aid dispersement and spend the money they gave me. I started taking an interest in personal finance, starting with a "Personal Finance for Dummies" book (which really, wasn't incredibly useful) and listening to Marketplace Money every weekend (which has been useful). Then I discovered the blog world.

The college years
Let's review my situation. I did a few things right in college and a few things wrong. There wasn't a penny saved for my education (nor do I think I'm entitled to have my parents save up. It would have been nice, but they did pay for four years of a private high school). My parents helped out some, providing me with a car and insurance, along with little bits of money, but mostly, it was funded on loans.

Here's what I had going for me.
-I had $2000/yr in scholarships and went to a relatively inexpensive state school.
-I worked part time throughout college
-I lived at home for 3 semesters (for free! Thanks mom and dad!)
-I opened a credit card to build credit history, and never carried a balance
-In the later years (once I became smarter with my money), I used money I was eligible for from subsidized federal loans (0% interest) to pay back most of my "alternative loans" that I took out my first year or two.
-I didn't go on spring breaks. Though some would say I missed out, I haven't had a chance to regret it

Here's what I could have done better, had I known.
-I took summer school my first two summers and while I worked, so I didn't work full time. This allowed me to get some difficult classes out of the way (and they were a bit easier in the summer), but was a financial mistake. Not only did I not make much money those summers, I also had to take out extra loans to fund them.
-I worked jobs that didn't pay well when i could have done something better. I worked in retail when, at minimum, I could have been making much much more waitressing.
-I didn't apply for internships related to my major until after my junior year (these paid around $15/hr), when I probably could have got one sooner.
-I studied abroad. Worth every penny, but realistically probably added at least 5000 to my student loan debt, maybe more. I don't like to think about it. =)
-I didn't finish in four years, but five. To be fair, I took one semester off for an internship (paid), so it was really 4.5 years. And I could have squeezed it in in 4 had I not studied abroad. Also, few people in my major get out in 4 flat, though it isn't unheard of by any means.
-I could have spent less money (but who couldn't?)

The after effects of the college years
Here's where things stand now. My base salary is about 56k, and I'm contributing 10% to my works 401k plan and getting a match on 6% of that. I have a Health Savings Account which I'm contributing 200/month to for the first half of the year, then it will be fully funded. I decided to do that in case I needed the money for a medical expense--I wanted it to be there ASAP. I'm contributing 350/month to a Roth IRA I opened in January (but I started out just contributing 250) with plans of maxing it.

I started working in June, and paid off about 6000 of student loan debt in the first six months. The interest rate was around 8% for that chunk of non-federal loans. I consolidated my federal loans through Wells Fargo, and I must say I'm really unhappy with how the process went. In fact, it is still not complete--somehow about 5500 of debt was "forgot" in the consolidation, and I'm waiting for them to finish adding it. Perhaps I'll discuss later, but Wells Fargo has left a bad taste in my mouth but now I'm stuck with them for the life of my student loan.

I opened a savings account at INGDirect after realizing Wells Fargo was paying me .5% or so on any money I kept there. Later I switched to HSBC for their "new money" deal, and plan on sticking with it. I'm paid bi-weekly, and have 300 from each paycheck automatically deposited in that account.

Here are the numbers, neglecting credit card balance ( always paid in full) and checking account (less than 500 anyway):
Student Loans at Wells Fargo (currently at 0% interest): $14,800
Student Loans waiting to be consolidated: 5,500 (7.14% interest... thanks for screwing up WF!): $5446
Roth IRA: $1100
401k: $9057
HSBC: $4130

The numbers won't add up exactly, but this includes everything:
NET WORTH: $-6,300

Oh look, it is still red.

I comfort myself by the thought that I have roughly $2000 coming to me in tuition reimbursement (once I finish my last project) and $300 coming in mail in rebates (what a pain!) from my laptop, so that brings the pretty red number to about $-4000. But really, that money isn't in my possession yet, so I can't count it. It would be just as sneaky to count this weeks paycheck!

Changing those numbers
I'm trying to set a goal for when I'll see that number turn black, but I just recently started tracking everything, and I really have no idea how much each paycheck will affect it. Usually, I immediately see about 1300 in my checking/savings, but that doesn't include my 401k+match, which probably is around another 300 or so. I imagine it'll be very soon--within months. Today is May 09th, and I imagine it'll take at least 4 paychecks to get in the black... so let's go with June 22nd as the date to be "in the black".

What I like about this goal is that I'm allowed to arrange my money how I want to meet it. I don't have to focus on increasing my savings at the expense of my 401k, I can attack everything in a balanced manner and still see a huge overall impact.

Let the learning begin.

I just got off the phone with the evil cable company, and reduced my internet speed to a slower connection and cut down to the most basic cable. The most basic cable is STILL 20/mo, so later on I'll decide if I want to keep it. She did offer me 20% off my current set up, but it ended up being 20% off the non-promo rate, so it was still 90/mo. Now for cable and internet, I'll pay just 45/mo! Half price!

This will most certainly do for the summer, maybe in the fall I'll bump my cable back up so I can watch MTV. =)

Living
My biggest luxury is living alone. Perhaps if I wasn't planning on moving in 6 months, I'd rethink this. At first, I didn't consider it a luxury, but almost a necessity! If I was wiser, I would have lived with a friend--this would have allowed me to NOT buy furniture that I'm only going to have to store (my next apartment will be TINY--moving to a much more expensive area). But I do value this luxury--I love living alone. My monthly rent for a smallish 1 bdrm is $575. This is a lot, but living alone wouldn't even be an option in more expensive areas.

Another luxury is cable internet and TV. I'm working on finding a cheaper solution. I could ditch the highest speed internet, and drop down to the cheapest cable. I think that would be about 40 dollars.


Personal
I also spend a fair amount of money on my hair. Every 3-4 months (I try to stretch it to 4!) I go to the salon, get my highlights touched up, a cut, and my eyebrows waxed. With tip, it usually comes to about $150--a lot! If I didn't adore my stylist, I might be motivated to go cheap, but she is REALLY good.

Travel/Adventure
This is a luxury that I haven't indulged in much this year (quite an expensive luxury!), but it is something that I value highly and am willing to spend money on (if I have it), always. The next several years we probably will just be doing small trips, but I hope to save up for something awesome--South America, perhaps? Also we are considering skydiving this summer, which would be about 150-200!

Eating Out
I try to limit this--I rarely eat out for lunch, but I really enjoy a good sushi dinner with the boyfriend. We are addicted! Occasionally, I also buy some less cheap groceries and cook. I'm a bit of a mess in the kitchen, but I like to try.

I could most certainly cut some (all?) of these luxuries out. It would allow me to pay off my student loans more quickly. Perhaps add a bit extra to my 401k. But I allow myself them because each month, I'm still gaining more assets and reducing debt. I'm making good progress, and I have good earning potential. I allow myself these luxuries because I won't mind paying my student loans a little bit longer in order to improve my quality of life now.

I don't allow myself every luxury. I would love a new car, I wouldn't mind eating out more, I don't buy too much for clothes. I have really crappy bedroom furniture. I've been desiring a coach purse from the outlet store for well over a year, new work shoes for months, a new swimsuit since they came out for the year, and a "water pik" for a week.

Still, I could probably have less splurges on things I don't really value highly.

First, I had a minor emergency today. I scheduled an HSBC withdrawal from my checking that would have caused an overdraft if I wasn't paying attention. Stupid mistake on my part, and I had no access to cash to fix it. I found a solution, but it makes me think I should put a little in savings to cover things like this.

The main reason I don't like to keep money there is because I take issue with Wells Fargo, but I don't want to switch my checking account for a couple reasons. One, my boyfriend, sister and parents have an account there. I know at this point in my life, there should be very little intermingling of family finances, but it happens, and it's just easiest if we all have the same bank. The boyfriend and I probably will be mingling our finances increasingly. Two, I consolidated my student loans there, so I have to have an account for that, and I don't need another bank. It seems like I'm stuck with them for a few years. Anyway, thus far their customer service for the loan has been beyond awful, and the other services have been average.

Now for the new goal. I've decided is once my high yield savings account hits 6500 I want to start up a T-bill ladder. It will complicate my taxes a little, but since I pay about 8% state tax, my effective yield, based on the past week would be 5.335%. For a better week, it could have been about 6%. I'll keep an eye on the rates while that is building, because they have been dropping.

It really won't generate that much extra revenue since I'm working with just a little money, but it is something slightly more "advanced" to do with my cash savings, still pretty liquid, and will continue to work as my cash savings grows.

Now if only those rebates from this laptop would show up. Seriously, I hate rebates. This is the first major rebate I've ever had, and it's turned me off of the process.

When I first moved here, I got a deal for about 60/mo for high speed internet and digital cable with stars. After 6 months, the rate jumped to 90, and I figured if I were to get regular cable and stars, it would go back to 60 or so.

I had been lazy and hadn't gone cheap, but today I was determined! I called up my cable provider, and said I wanted to get rid of digital cable and Stars. "Certainly! I can help you with that! But do you realize if you get rid of digital cable and stars, your rate on cable will go up?"

"No... What??"

Apparently, I'm *still* on a promotional rate, just a "lesser" promotion! Are you kidding? I don't consider 90/mo reasonable, much less promotional! It would be MORE expensive for me to get rid of digital cable and stars than to keep it for the remaining two months. WOW.

"Family cable" would cover any channel I watch (2-72) plus more, and would be about 50 a a month. Internet would be 45/mo. The cheapest cable is 16 a month, but only covers 2-22--most network shows, but not the other stuff I watch. I forgot to ask if they offer an lower speed cheaper internet. Probably not.

I'm going to have to do something differently, these rates are ridiculous. I'm not opposed to DSL, and maybe I could just get NetFlix and start watching movies instead of cable.....

I'm outraged. Maybe this means I should invest in cable television and broadband companies. =) Someone is making a killing here.

I recently set a June 22nd "in the black" goal.

I also want to talk about my goals for the year. My original (financial) goals were as follows:

-Open Roth IRA and contribute 3000 over the course of this year
-Contribute 10-15% of pre-tax dollars to 401k
-Save 100/wk in INGDIRECT account
-Pay at least 200/month on student loans

My updated goals are as follows:
-Max out Roth contributions at 4k
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Save 150/wk in HSBC account (switch banks!)
-Pay 250/month on student loans

And the "reach" goals, that I don't even know if are possible:
-Max out Roth contributions at 4k (same)
-Contribute 10-15% of pre-tax dollars to 401k (same)
-Accumulate 10k in HSBC account (about 1k extra)
-Reduce loan debt to 16k (about 2k extra)

Good luck to me!

Something I've noticed in some of the financial blogs I read is that some people who have their money "figured out" are quite arrogant about it. I notice it more so in the comments than in the actual bloggers. It's sure nice to pay your credit card in full every month and to be sitting on a pile of savings and able to live within your means. It's practically essential for happiness, I think. But just because someone hasn't been able to do this, doesn't mean they are a worse person, it means they either started in a worse position or made a series of poor decisions (or both). I applaud anyone who has their finances under control, but those who do not aren't going to improve by us judging them. Of course, I tend to be slightly liberal and fall subject to the "bleeding heart" stereotype occasionally.

One opinion I came across personally offended me, because it was essentially calling me a worse person because I didn't follow their rules. This is the opinion that advocates never taking on debt and ridding yourself of debt before investing. At first glance, that seems reasonable. However, my life hasn't worked that way, and I don't think that I did it (or am doing it) "wrong".


I understand most people agree that education and houses are "good debt", but there are those that think there is no such thing.

I financed my entire college education on student loans. Oh sure, I had jobs. They helped out, but you can only make so much money working part time and summers. Some would say that was a mistake, that I should have went to work full time until I could save up enough to afford to pay for college in cash. There are people who do this, and it is admirable. However, education was very important to me, I was always a bright student, and I knew that i wouldn't be happy if I didn't go to college. I picked a major I enjoyed that would allow me to earn a good living, and put my heart into school. For the most part, my loans were subsidized and accrued no interest until I graduated. A year before I graduated, I received a job offer of a respectable 55k + benefits in an low cost area, and took my final semester abroad. Financially, it wasn't responsible for me to go to Asia for my last semester. Still, I don't regret it. I knew that it was on borrowed money, but it was the only time in my life that I would have the time to do something like that. So I did it. I don't regret it.

Since then, I've been working on paying my debt down. I've paid about 6k so far, and have slowed down now that the interest is subsidized again (since I am taking classes part time while working). I have about 20k left. If I had waited until I could afford college, I would have wasted years of my life in a low paying job when I am capable of more.

Also, I'm investing even though I still have debt. I'm not just investing enough to get the company match--I'm investing 10% as well as maxing out a Roth. At the end of the year, I know that the 4000 I have in my Roth could be 4000 less on my loans. I think this is a good move, given the low interest rate on my loans (and no interest for now), and time is on my side for compounding interest. Even though the loans are accumulating interest each month, it isn't compounding.

Debt can be repaid, but time, you can never get that back.

This is my first month of tracking expenses and it has helped me to limit my spending--i know if i buy something, I have to record it!

Still, it's not going so well. This month I have a paycheck income of about 2700. I've subtracted out rent, planned payments to student loans, planned automatic savings to my Roth and my HSBC account, bills I already have paid and bills that will come due this month. Then I have subtracted money I've already spent. All that is left for the rest of the month for food, clothes, entertainment, gifts, etc is $311! I expected to have more!

The reasons for this are explainable. I had an auto repair this month, something unusual, of about 200. I also went on a long road trip, driving about 1000 miles more than I usually do, which increased my gas expenditure by about $80. Also, I really need to ditch the expensive cable and go back to basic!

Still, tracking this month will help me see if my savings goals are reasonable. On my salary, is it reasonable for me to be able to save 600/mo in savings, 350 in a Roth, and also pay 250/month on my loans? That is about $1200, just under 50% of my take home pay. It is tight, and I'm not sure, but that is what I'd really like to do in order to get where I need to be.

Also, the 250/mo on my student loans is arguably a stupid financial move. I took two graduate classes while working, which put me in "school status" which means that interest doesn't accumulate on the loans. It is MUCH smarter financially to throw that money elsewhere.

The reason I am paying anything on them, much less extra, is two-fold. First, I'm not interested in paying student loans for the rest of my life, despite the fact that the rate is low. It's psychological, and I know this, but I would like the freedom of not having them. The second reason is because of my boyfriend, whom I am expecting to soon be engaged to. He is fortunate enough to have no student loans, and actually a few thousand in various savings as a college graduate of just one week (congrats, T!). Debt makes him anxious, and he doesn't even have a credit card yet. After about 2 years, I think I have finally convinced him he needs one in order to have a credit history and he plans to get one soon. That explains how he feels about debt! Since we plan to unite our finances in the next year or so, I sought his opinion on what I should be paying on them, since I was considering reducing payments. I informed him they weren't accumulating interest at this time, and that I could easily put the money into my savings and my money would work for me there. He still argued to pay them off as fast as possible, so I compromised and said I'd just keep it at the same level.

I had second thoughts about my compromise, and since it is still my money and my debt, I came up with an alternate plan. I will continue to "pay" $125 out of each paycheck to the loans, except I'll funnel it into it's own separate high interest savings which will be untouchable. As soon as interest kicks in, I'll dump the money into the loan, plus any accumulated interest. Arguably, this interest could be minimal--even if I have it in there a whole year, maybe just 100 or so. Still I just can't justify paying off a 0% loan.

In the begining...
In the past month, I have been perusing through the world of personal finance blogs. I have seen some very good things from a variety of people. I briefly considered emulating some of my favorite blogs and trying to set up a site that could generate some amount income. At this point, it didn't seem like a road I need to go down, probably not worth the effort since I don't expect a large readership. There are a lot of good financial blogs out there already and I don't know if I have the time to devote to making a blog that would be truly unique. If my blog becomes wildly popular, I may change this, but for now, I did what I knew how to do--went to blogger.com and hit the ground running.

Instead, I am just going to chronicle my journey, as many others do, so I can track my progress and stay motivated.

Roughly one year ago, I graduated from college and realized that money was more difficult to manage when there was more to do than just show up for financial aid dispersement and spend the money they gave me. I started taking an interest in personal finance, starting with a "Personal Finance for Dummies" book (which really, wasn't incredibly useful) and listening to Marketplace Money every weekend (which has been useful). Then I discovered the blog world.

The college years
Let's review my situation. I did a few things right in college and a few things wrong. There wasn't a penny saved for my education (nor do I think I'm entitled to have my parents save up. It would have been nice, but they did pay for four years of a private high school). My parents helped out some, providing me with a car and insurance, along with little bits of money, but mostly, it was funded on loans.

Here's what I had going for me.
-I had $2000/yr in scholarships and went to a relatively inexpensive state school.
-I worked part time throughout college
-I lived at home for 3 semesters (for free! Thanks mom and dad!)
-I opened a credit card to build credit history, and never carried a balance
-In the later years (once I became smarter with my money), I used money I was eligible for from subsidized federal loans (0% interest) to pay back most of my "alternative loans" that I took out my first year or two.
-I didn't go on spring breaks. Though some would say I missed out, I haven't had a chance to regret it

Here's what I could have done better, had I known.
-I took summer school my first two summers and while I worked, so I didn't work full time. This allowed me to get some difficult classes out of the way (and they were a bit easier in the summer), but was a financial mistake. Not only did I not make much money those summers, I also had to take out extra loans to fund them.
-I worked jobs that didn't pay well when i could have done something better. I worked in retail when, at minimum, I could have been making much much more waitressing.
-I didn't apply for internships related to my major until after my junior year (these paid around $15/hr), when I probably could have got one sooner.
-I studied abroad. Worth every penny, but realistically probably added at least 5000 to my student loan debt, maybe more. I don't like to think about it. =)
-I didn't finish in four years, but five. To be fair, I took one semester off for an internship (paid), so it was really 4.5 years. And I could have squeezed it in in 4 had I not studied abroad. Also, few people in my major get out in 4 flat, though it isn't unheard of by any means.
-I could have spent less money (but who couldn't?)

The after effects of the college years
Here's where things stand now. My base salary is about 56k, and I'm contributing 10% to my works 401k plan and getting a match on 6% of that. I have a Health Savings Account which I'm contributing 200/month to for the first half of the year, then it will be fully funded. I decided to do that in case I needed the money for a medical expense--I wanted it to be there ASAP. I'm contributing 350/month to a Roth IRA I opened in January (but I started out just contributing 250) with plans of maxing it.

I started working in June, and paid off about 6000 of student loan debt in the first six months. The interest rate was around 8% for that chunk of non-federal loans. I consolidated my federal loans through Wells Fargo, and I must say I'm really unhappy with how the process went. In fact, it is still not complete--somehow about 5500 of debt was "forgot" in the consolidation, and I'm waiting for them to finish adding it. Perhaps I'll discuss later, but Wells Fargo has left a bad taste in my mouth but now I'm stuck with them for the life of my student loan.

I opened a savings account at INGDirect after realizing Wells Fargo was paying me .5% or so on any money I kept there. Later I switched to HSBC for their "new money" deal, and plan on sticking with it. I'm paid bi-weekly, and have 300 from each paycheck automatically deposited in that account.

Here are the numbers, neglecting credit card balance ( always paid in full) and checking account (less than 500 anyway):
Student Loans at Wells Fargo (currently at 0% interest): $14,800
Student Loans waiting to be consolidated: 5,500 (7.14% interest... thanks for screwing up WF!): $5446
Roth IRA: $1100
401k: $9057
HSBC: $4130

The numbers won't add up exactly, but this includes everything:
NET WORTH: $-6,300

Oh look, it is still red.

I comfort myself by the thought that I have roughly $2000 coming to me in tuition reimbursement (once I finish my last project) and $300 coming in mail in rebates (what a pain!) from my laptop, so that brings the pretty red number to about $-4000. But really, that money isn't in my possession yet, so I can't count it. It would be just as sneaky to count this weeks paycheck!

Changing those numbers
I'm trying to set a goal for when I'll see that number turn black, but I just recently started tracking everything, and I really have no idea how much each paycheck will affect it. Usually, I immediately see about 1300 in my checking/savings, but that doesn't include my 401k+match, which probably is around another 300 or so. I imagine it'll be very soon--within months. Today is May 09th, and I imagine it'll take at least 4 paychecks to get in the black... so let's go with June 22nd as the date to be "in the black".

What I like about this goal is that I'm allowed to arrange my money how I want to meet it. I don't have to focus on increasing my savings at the expense of my 401k, I can attack everything in a balanced manner and still see a huge overall impact.

Let the learning begin.