The Costs of Luxury

Sorry for last week's absence...huge event at church that I was in charge of.  Back to the real world this week.

Yesterday afternoon my mom took my two oldest kids for the afternoon.  She took them to a local playground and they had a blast.  I had a little luxury...a Sunday afternoon basically free.  (When you have three kids, only one seems "free.")  I spent it catching up on my favorite restaurant makeover shows and Gail Vaz-Oxlade's newest show, "Princess." 


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 The basic point of the show is for "princesses" - those who think they deserve the best of everything...and get it - to be cut off and learn to live on their own without going into debt.  If they succeed for 6 weeks and complete all of her "challenges" they win up to $5000. 

(Don't even bother trying to sign up to be on it...unless you live in Canada.)

But one of her points this weekend was eye-opening to me.

She had one of the princesses calculate how many hours of work it would require to buy their luxuries - purses; shoes; travel, eating out, etc...  But that wasn't the eye opener, she had them calculate it using their disposable income.

Basically, the girls would have to do their budget for the month, and (for simplicity) let's say they'd have $60 left over...yes, for the whole month.  An average, 40-hour/week, employee works 160 hours a month.  60/160 = $.375 of disposable income per hour.  Meaning, if they wanted a $400 pair of boots, it would require that they work 1067 hours.  That's 26 weeks...or half of the YEAR!!!

Not many people would work half a year for a pair of shoes.              

(Me...if it were the right pair...just maybe.   Lol.)

So I started doing that with random things around my house.  Not bragging, but just being honest, when you're debt-free it doesn't take long to pay off little things like a night out or a new dress. 

So I started doing that with the big things, Christmas, our Florida/Disney vacation we're planning in May 2012. 

And wow...it's going to take a while to work for those things.   More than a month is a lot to me..

More than two months is an eternity.  (What can I say...I have ADD.  Much longer than that and I lose interest.)

Anyhow, I just thought that was a neat little challenge that I would pass along.  When you're planning that weekend away or the new appliances, it is eye opening to see how long you have to work for it to be able to pay for it.

…And the greatest of these is….CHARITY

First of all, kudos to you if you know where that saying came from. 

Second, let’s talk about charity.

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Not a charity; your charity.

I’ve talked about my Give & Take on Tithing. 

Charitable giving, tithing especially, is one of those math equations that just don’t work.  The more you give, the more you seem to get.  Don’t ask me why.  It’s simple fact faith.

Yes, God rewards you for your tithing and charitable giving.

And so does the government.

You can deduct your tithes, offerings, charitable donations on your tax return.*

(*NOTE: You can only deduct them, if you have enough contributions, along with other things such as mortgage interest, to qualify you for taking itemized deductions over the standard deduction.  Not sure?  Ask a professional.)

This is one of those deductions that completely rely on your honesty.  You could put down that you donated $7,000,000 to charity.  Unless your income is well over 8 figures, I wouldn’t recommend that.

But how do you prove what you gave?

1.                  Give by check.  If I can give you one single piece of advice, this would be it.  GIVE by check.  You can easily get a copy of that check if you would need it.  Plus, it helps the organization you gave to be able to track the donation. 

2.                  Ask your church/charity to provide you with a year-end statement with the total that you gave.

Keep in mind that, never, not once, ever, has the statement that I received from a church been correct, so double check it.  Often times, they may leave out special offerings, fund raisers, etc. that are deductible. 

3.                  Make sure your donation is eligible for deduction. 

Even though you make think your local booster club is a “charity” they may not have applied for “501(c)(3) status.”  A 501(c)(3) organization has been recognized by the government as a bona fide tax-exempt organization.  If not, a donation to them is not tax deductible for you, and is actually taxable income to them.

Not sure?  Check here.  All 501(c)(3) organizations (other than churches) are listed there.  (Churches are inherently tax exempt, unless they make a big boo-boo.)

4.                  If you do give cash, if it’s over $250 get a receipt or put it in an envelope with your name on it.  Otherwise, there is no proof of it.  No proof equals no deduction.  If it’s less than $250, I would still recommend one of the above methods, but at least keep a note with the date and the amounts.

5.                  If you donate to a fundraiser for a bona fide organization, some of that may be deductible.  Say you bought a pizza for $20, and that pizza retails for $5.  You can deduct $15.  In other words, you can deduct the excess of what you paid from what it’s worth. 

6.                  If you donate items, get a receipt!!!  No matter the amount.  If not? See #4. 

If you give at all during the year, I would recommend keeping track.  Every $100 you give, means $25 back in your pocket.  (Assuming a 25% tax bracket.) 

Although you may not think it’s much, every little bit makes a difference to that charity and on your taxes.

The Secret to Successful Online Shopping

I love saving some dough, the Benjamins, cold hard cash.

And I will admit, I frequent the online world of shopping...shocking, I know.

But before I ever click on "Buy" I follow a couple steps to make sure I'm getting the absolute best price online.  I assumed the rest of the world operated this same way. 

So imagine how my debt dumping, ever saving, penny pinching world was rocked when I found out THEY DON'T.  The best way to convey my reaction is this...

I still love this movie!



I was shocked!  Aghast!  Flabbergasted! 

So, here are my top three tips for savvy online shopping.  (Does anyone else but me want to say "savvy" with an accent like Captain Jack Sparrow?)

1.  Go through a cash back service.

Always, always shop through a cash back service.  My personal favorite is Ebates.

All you do is go to the site, search for your retailer (such as Barnes & Noble, Groupon - yay!!, Sears, just to name a few.)  Click through their website and wa-lah, you'll be earning anywhere from 2%-10% back on your purchase.  Just for clicking through their link.  And if you're feeling philanthropic, you can choose to donate your cash back to a charity.

There is also Shop at Home which is a lot like Ebates.  Just different stores.

I've had an Ebates account since 2006 and earned $141 dollars.  That's not a huge amount, I know.  But $141 is $141.  (A tenth of the way to your emergency fund!)  I don't do ridiculous amounts of online shopping, but I usually rack up during the Christmas season.     


Ka-ching!



2.  Google "[retailer] promo code"

Even when using one of the above cash back sites, you can still use discount codes.  I typically google the name of the store and "promo code."  This will bring up several sites that "specialize" in this.  A word to the wise, don't just click on a random one.  You'll end up with smut all over your computer.  :) 

My favorite site is http://www.retailmenot.com/ .  They're bona fide.  But retailers can opt out or limit codes that can be posted so if you don't find success there, keep trying.

Ka-ching!

3.  Don't forget to price compare.

Pricegrabber compares prices online from different retailers.  When you factor in discounts, shipping costs, and sales, the amount you pay can vary widely on the same exact item. 



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Hopefully, on this Thrifty Thursday, these simple strategies can keep some coin in your pocket next time you single handedly decide to stimulate the economy. 

Me vs. The Machine

If you follow me (me, not DDA) on Facebook, you've been enduring my latest rants against my computer.

I have had the same work laptop for three years.  Every morning, as I walk into my office, I walk on a bridge that goes over four (or six?) railway lines.  I've really wanted to *accidentally* drop this computer off the bridge the last few months and let Norfolk Southern smash it to bits.
 
Now, you need to understand, in the real world, a three year old laptop would be outdated, but still fairly functional.

Not government laptops.

We buy outdated laptops and then uninstall any program created in the last 15 years.

Seriously, we should just carry these...


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Our computers are about as efficient.

The warranty on my laptop ran out last week. 

Ironic.

I'm fairly computer literate, so last Tuesday when my wireless capability all of the sudden was disabled, I thought, "No big deal.  I got this."  And after three hours on the phone with an IT guy (and I call him that loosely) who "fixed" my computer...I got this:

Dun...dun..dun...  THE BLUE SCREEN OF DEATH

Then Wednesday, in the middle of critical tax law research (fun! fun!) my cd/dvd rom drive decides it's not going to work...at all.  It wouldn't even read a Jason Aldean cd.   Tragic, I know.

So, after another phone call to IT, they overnight me a replacement cd/dvd drive...but no tools with which to actually replace the drive.  So after my feeble attempts with a steak knife, glasses screwdriver, and surgical scissors (don't ask), on Friday, I end up spending an hour in the office of one the best computer geeks I know just to perform what should be a fairly routine procedure.  And it ends up like this...


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 (Ok, a bit of an exaggeration, but still, it was in more pieces than it should be.) 

And today, after spending another two hours on the phone with IT, and finally getting all of my computer issues resolved, I was informed I was getting a replacement computer

Yes, this is an actual picture of my actual computer in my actual trashcan.

You think that information would've been relevant LAST WEEK!!!!

Funding Your Emergency Fund

If you're just starting FPU, your first "baby step" is to fund your emergency fund with $1000.  (This is so you don't add to your debt, while paying down debt.)

When we first started FPU, saving $1000 seemed almost impossible.  While $1000 is not life-changing, it's nothing to sneeze at either.  If we could save $1000 in a month, why would we be in debt?  I thought it would take us 2 or 3 months to fund our emergency fund.

So, I was shocked when we were able to raise $1000 in less than a month.  I know...in a matter of 4 weeks!!  And this is how we did it...

1.  We held a yard sale.

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Now, I am not a fan of yard sales.  Holding or going.  As much as I love saving, I hate haggling and being haggled with.  So I piggybacked.  One of our friends held a yardsale.  I took my stuff over, let them price and sell it.  I had zero stress and just got to pick up the cash.

2.  We sold excess furniture online.

Look around your house and I bet you can find at least two pieces of unused furniture that are in fairly nice enough condition to sell.  I was shocked when I listed a coffee table, end tables, and a dining room set on Craigslist and they all sold.  (It does help to be in a college town.)

3.  I sold everything I could on ebay.

I love purses.  (Before I collected shoes, I collected purses.)  I sold at least half my collection on eBay.  Along with candles, decorations, cookbooks, luggage, makeup, kitchen items...

Anything still in the box, with tags, or unopened, got sold. 

4.  We paid the minimum payment on EVERYthing.

This was the hardest for us.  We had always paid extra on everything.  (And yet, still grew deeper in debt.  Bad math, I know.)  We cut all our payments back to just the minimum and banked the difference.  Including our credit card.  It still turns my stomack to think about.

5.  We cut our variable expenses by half.

Heard of the rice & beans budget?  That is what you're supposed to live off while you're getting out of debt.  The first month, we just had the "rice budget."  I'll admit it, we ate ramen for dinner more than once.  We spent $0 on groceries other than absolute bare necesseties like milk.  The rest, went into savings.

These are only 5 options, I didn't even touch on second jobs, consulting income, etc.   $1000 can seem daunting, but it's doable.  And there is a direct corellation between your determination and your success. 

Hmm...maybe we should do it again...I could sure use some new shoes! 

Just kidding.





Maybe.

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One Classy Lady

We've talked about the importance of family...

We've talked about the importance of giving...

We've talked about the importance of loving..

Much of what I believe in how people should live and be treated has been ingrained in me since birth by my mother, grandmother, aunts, and leading ladies in my life.

One of those Leading Ladies was a woman named Wowo.

She wasn't my grandmother.  She was actually my cousin's grandmother.  But yet she always treated me like a granddaughter.  She had the biggest heart I know. 

When I was a small child, she would hide sticker sheets in her Bible and give them to me on Sunday nights after church.

When I was a teenager, I sat with her and her daughter Cathy almost every church service.  On the rare occassion I brought a boy to church, she'd even look the other way when we held hands. 

When I was a poor, broke newlywed, she'd invite me to Sunday lunch with her family and pick up the tab.

She was the first to welcome a vistor and loved practical jokes.

Wowo appreciated coordinated shoes & bags; and understood that a shopping trip, meant you need to go out of town to a really good mall.

On a church workday, she was the first to show up AND have a plan on how to get it all done. 

She would tell you "how it was" but with a smile on her face so you never felt dressed down.

She truly was the epitome of grace and class.  What every woman should strive to be when they grow up

Wowo graced Heaven's gates last night.  She will be sorely missed.  I've spent a better part of this evening looking through photos, crying, remembering, laughing...and editing this post furiously to attempt to do her justice.  It's almost midnight and I'm still not sure I've been able to convey what an amazing woman Wowo was. 

We love you, Wowo, and will miss you dearly!  I'm sure you're already organizing the robe closets in Heaven!  You leave behind some really big *coordinated* shoes to fill.