Author Topic: Trying to start our 'staches, but can't see the forest for the trees. Help!  (Read 10770 times)

EK

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My husband and I are reformed spendthrifts and we're trying to start building our 'staches!  The situation is a little complicated, but any advice/ suggestions/ face punching is welcome!  This is extremely lengthy and I apologize for that!!!  Advice is GREATLY APPRECIATED though!

We're both 26 and we're basically starting from scratch here.  We are both on board, me probably a LITTLE bit more on board than Mr. Evakatharina.  We messed up our taxes, ended up owing about $4000.  But we didn't have it, had to borrow from my mom, it was an unpleasant situation we never want to be in again.

  Over the past few months we've paid off the small amount of consumer debt we had on credit cards (around $1500) and started actively keeping a budget to help us fix our bad habits.  We have a budget on mint that we've been good about sticking to.

What we would specifically like advice on is our budget (where to improve), and advice on how to prioritize the extra money we'll have for paying debt and investing. We've worked very hard to pull a system together and we've done really well so far, but we want to do better and we're struggling to get the big picture on what to do with the money that we now have to save.  I've arbitrarily targeted wanting to get to 50% savings of our take-home pay.



 Here are the numbers:

Debt:
$17900 student loan debt (average interest approx 6%)
$3500 bank of mom @ 0% interest and unlimited time to repay

Assets:
$2099.81 cash in the bank
1 car worth about $1500 - '98 Volvo, reliable car, around 200,000 miles on it

Income (net pay after taxes): $6300
$4200 income #1 - mine
$900 income #2 (approx, varies a bit month to month) - his
$1200 income #3 (also variable, this one by season) - his

Monthly expenses:
$750 rent
$150 car insurance (going to reduce this by a lot after insurance covers a repair being made this weekend)
$250 gasoline
$450-500 train travel
$380 gas & electric
$50 Internet
$55 directv (I know... We're trapped in a contract for another year, at which time we'll be replacing this with a $9 Netflix bill)
$280 groceries
$160 eating out
$150 pets
$25 personal care items
$25 misc household items (example: I used this money this month to replace a broken coffee pot... I like to keep this in the budget because those little things always creep in)
$316 minimum student loan payments
$200 mom loan
_________
=3241-3291 basic spending
That puts us pretty close to 50% savings (where I'd like to be), and at a glance it looks easy to get the budget where it needs to be...

But...

Some curveballs:
- Right now we don't have health insurance.  I will get health insurance through my job starting later this year.  Cost/month $910 for the two of us.  We don't have the savings to make a cheaper, high-deductible plan a good option for us.  That's a big chunk of our money though that would be available for savings.  For me only it's around $300... Is there a way to get just him insured for less than $600 a month?  We are both healthy.  We are active and eat a very healthy vegetarian diet.

- gasoline can only be reduced by a minimal amount right now.  The vast bulk of that expense is necessary work related driving for income #3.  (Dog walking- he has to drive house to house.)

- to reduce gasoline use, I suggested a scooter for him to drive to work and save us a huge amount of money (probably 1/3 of what it is now).   He is NOT INTERESTED.  He's paranoid that it would be dangerous.  I would be okay with getting rid of the car completely and then also being able to save a ton off of insurance too, but like I said, he is not having it. 

- to buy a new (used) fuel efficient car that he would deem "Safe enough" (to be a little fair... He does A LOT of driving...) we'd probably be looking in the $5000-$8000 range and we just don't have the money yet.  The car is old and when we do end up replacing it, we'll definitely look for something more fuel efficient, but replacing it immediately doesn't seem like an option.   Open to suggestions here.

- we want him to keep the dog walking job that requires all the driving because it's good income, especially in the summer, plus it's fun.  He gets to be outside all day walking dogs.

- we use the car very infrequently for personal things.  We can walk almost anywhere, and I'm working on convincing Mr. Evakatharina that biking would be a good way for us to get around town, specifically to the grocery store.

- train travel expense is another one that looks like an easy target, but isn't.  I take the amtrak from Virginia to New York every other week for my job.  Some months the cost is even lower, around $400, but the cost varies seasonally so best to leave a safety margin to account for high prices around the holidays.

- I want to keep my job (income #1) for a variety of reasons: 1) it is our largest and most reliable income by a lot, 2) only job that we can get benefits through, 3) the pay is easy more than double what I would get at any other job with my current skill set, (if i could even find another job!) 4) this is the big one- I only work every other week!!!! It is an awesome schedule!!!!!! (I am employed as a live-in nanny, but there's a second nanny who alternates weeks with me).

- long term caveat: I am a nanny.  The kid I am nanny for is not going to always be a kid.  When she's old enough, I'm going to need a new job, and I might have to go to school for a couple years to get some job skills. No other nanny job is going to be even remotely comparable pay either.

- we're currently eating out 1-2x per week.  I would be fine with dinners out as a special treat maybe once a month, but the Mr. eats out with his mom and considers those times to be "special traditions".  Sometimes I convince him to invite her over to eat at our house instead, but he's pretty inflexible here.  He's reading the responses to this though so if someone who isn't me suggests it he might be more likely to listen. ;)

- I'm very open to ideas for upping our income.  I have A LOT of free time and I'm working on some projects that might eventually make me a little money, but maybe not (I have an etsy shop, and I've just started a design blog).  The Mr. has only little free time, but he has writing and copy editing skills. I think he  could make money as a freelance writer and/or copy editor.  I have casually suggested, but his reaction is "oh yeah... That might be nice..." (no intent to act on it)

- I get a $10,000 Christmas bonus each year, more like $6000 after taxes but its something.

- we have tried to lower the pet budget, but with 2 cats and 1 dog, we've been unsuccessful.  Short of switching them to bargain basement food (this is not something I am willing to do AT ALL.  Non-negotiable for me to feed them well.) it is very difficult to spend less than this after food, litter, flea prevention, and yearly vet check-ups.  We do all their grooming at home and I love them very, very much.


AND THEN!

Once the budget is ironed out.... What do we do with our extra money, and in what order???  I have some ideas, but I'm struggling to get the big picture and pull together A Plan.  What I want to do:
- pay off student loans
- open Roth IRAs for each of us
- start investing in index funds
- save for a new car
- save for a house down payment
- emergency fund- we'd like to keep around $3000 cash in the bank- we have credit cards as backup if we really need it.  We're more inclined to do things with extra money than let it sit.
- anything else We should be thinking about???

We're both going to be reading the responses!  Hah hopefully at least one person got through this whole post and will take a minute to offer some advice!  :)
« Last Edit: May 02, 2013, 12:50:38 PM by Evakatharina »

Another Reader

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In my opinion, your husband needs to look for a real job or find some other way to increase his income.  More dogs, some petsitting, and some higher-paying overnight petsitting jobs would be a start.  In the meantime, he needs to stop demanding his way in so many areas. 

Your job is risky, as your current employer could develop any number of reasons to make a nanny superfluous.  Saving is more important than investing right now, because both of your employment and income are just not that secure.  You have a lot of debt relative to your income and that should also be a focus. 

If a cheap high deductible health plan for him is available in your state, that needs to be looked at.  The health plan through your employer may work for you, but it's too expensive for him. 

Pay off the debt and focus on the income problem.  In your shoes, I would get rid of the debt and focus on increasing and stabilizing the income before I thought about saving beyond a large emergency fund.

pop pop!

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You may want to reconsider the high-deductible plan option.  You can save the difference you save in premiums every month into an emergency fund to pay off bills.  In the meantime, use your credit cards in the unlikely event that you incur some unexpected medical bills to meet the deductible.  Then use the money you save into your emergency fund to pay off the credit card bill.

A lot to wade through here.  Things that jump out at me are your high gas and electric bills, the $400-$500 for "train travel", and $50/month internet.  Since you have Direct TV, you don't need to stream TV, so you may be able to get away with a less expensive high-speed internet plan.  (I recently switched to $18.99/month plan from freedompop, which I learned about on this website, and it works fine for me and my wife, but beware the data limits.)  I wonder why your utilities are so high, maybe you need to consider your electricity and gas usage.  If you live in an old drafty rental or something, you might be able to move to a newer, smaller place that will be less expensive to cool and heat.  And train travel.  If it's purely discretionary, you might consider cutting back.

As for dining out -- it can't hurt to try eating out only once per week and see if you can make one meal per week at home a "special one", either make something new, have friends over, or do something else different to mix it up.

I'm sure there's more here but that's what I got for now.

EK

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Just to clarify (just FYI to anyone else willing to look at our situation here)

1) the reason for his two jobs right now is that the dog walking is income, but the 2nd job (income #2) is great job experience in a line of work that he's interested in (copy-editing) that could open up much better full time possibilities down the line (not enough experience yet to be a good applicant but in a year or two he will be.) The dog walking is flexible enough to accommodate any strange hours at the low-paying but best-future-prospects copy editing job.  Between the two of us we make over 100k before taxes which is not shabby at all for 26- many friends with more practical educations are much worse off income-wise- so the dog walking seems decently lucrative for a side hustle while he's getting experience in a field he'd like to work in long term???? Any ideas on other side hustle type things he could do with similar flexible hours?  Both jobs are pretty secure.  Chances of losing either are unlikely at this point.

2) my job, at least for the immediate future (5-7 years) is very secure for as long as I'm willing to keep it.  Nanny sounds like a fake kind of job, but it's not a standard gig.  They are extremely wealthy, and the nanny would be about the last thing on the chopping block in the event of financial catastrophe.


Thank you very much for your input!!
« Last Edit: May 02, 2013, 10:29:11 AM by Evakatharina »

EK

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Internet thought is a good one, especially since we are locked into directv for the time being (we would have to buy out in full the entire remaining year of service we have left, so we might as well keep it for now.  I did look into it.)

As for as the house- it's a give and take with the low rent (for the area) and the high utilities.  It's a huge 3 bedroom house that is worth easily double what we pay in rent in this area.  It's a drafty old house with baseboard heat, and the windows are sealed closed so we cant even open them in the summer to save on the air conditioning.  Reason rent is low is because is owned by a family friend and basically they're being nice to us.  If we were to look for alternate housing, we'd have to pay 1000-1200 for even something very basic so compared to to the $750+ridiculous utility bill, it's a wash money-wise, with the current place being the better option because its a beautiful, spacious place to live.
« Last Edit: May 02, 2013, 10:28:39 AM by Evakatharina »

Spork

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Curious... if you're spending $500 for the train a month for a job... is that something your employer would pay for?  I'm not a nanny, but if I so much as drive 100 miles and back, I can expense the cost.

And, like others said, maybe reconsider the high deductible plan.  The monthly savings are huge.  In the unlikely event that there was an issue before you stash away the deductible safely, it's likely you can put this on a credit card or finance it with a medical provider.   A year's worth of stashing away the difference between the two plans will generally cover the deductible for years to come.

EK

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I'm looking up health plans right now... Looks like we could both potentially get insured for around $250 a month for both of us under a high deductible plan where the max out of pocket is low enough that we could likely pay by credit card if we had to in the unlikely event of a huge emergency.  My parents would also be able to lend us money in thr event of emergency, but I HATE to burden them.  So we wouldn't be on the street regardless.  And chance of catastrophic injury is low and it would keep us within spitting distance of that 50% net savings target... Hmmmm... Must discuss with the mister.  I'm glad I posted here before signing up for that $900/mo plan. 

I MAY be able to convince my employer to pay at least part of my train travel at my end of year review.  I'll get a 3-5% raise anyways, and I'm already ludicrously over-compensated for my line of work, but It's a good thought and I don't think it would hurt to ask.

These ideas are all really appreciated.  It's great to get a new take on some things I had considered inflexible.

DaftShadow

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Hey Eva,

You look like you've got a strong grasp of the fundamentals here, and you also seem to have pretty well identified that getting your partner truly onboard is perhaps the most important part of this.  :)

Three major things stick out at me:
  • There is over $1000 in cashflow not accounted for
  • Train Travel
  • Housing+Bills

I'll start with #1.  4200+900+1200 = 6300   .  Multuply by  * .7  to subtract 30% total taxes = $4410 net income.

If your total cash outflows are really $3291 per month, then you should have an extra $1100 every single month...  Either you are overestimating the annual income of yourself and your partner, *or* you are spending more money than you think.  Track it down.


Regarding #2, train travel.  I've taken megabus, boltbus, and greyhound many times from DC to New York.  It's a fantastic ride, just as comfortable as train travel.  The cost was always far lower than the train (almost half), and the time was just a little longer. I don't know what city you're in, but invariably it will be serviced by greyhound, at a minimum.  If you're only doing the route twice a month, you could possibly save $200 per month taking buses instead.  Think of the extra hours on the bus as "time spent making $50/hour just by being awesome." :)


Regarding #3, I want to point out that while you are correct, you are simultaneously making a beginner mistake that will hurt you in the long run:  Even if something is a good deal in general, that doesn't mean it's a good deal FOR YOU. 

To use an analogy, restaurants are constantly offering great deals to come to their store.  "Come to subway with this coupon and get 2 sandwiches and a drink for $9!  Save $7!".  And compared to eating at subway normally, that *is* a great deal.  But compared to making your lunch at home, it's a disastrous deal! 

Housing is no different.  Just because you can afford to live in the "huge 3 bedroom house", does not mean you *should*.  :)

Obviously, it's easy for us to say "go smaller, you'll be fine", and you need to make the call for yourself.  But do keep in mind that you are paying extra wages (aka keeping yourself further from retirement) every month to keep heated 2 extra rooms that you don't need or use.  How you *deal* with that, is up to you.  Don't feel pressured to do something you don't want.  But don't avoid it either.  It may look like it's impossible to find a better housing situation, but as with most things in life, we are usually somewhat wrong.

Remember too that there are always creative ways to solve things: Wearing sweaters more often at home is potentially a starter solution that could keep you in luxury, while decreasing expenses and adding a tiny little stress to remind you of what you are paying for the wonderful extravegance you live in...

You've had good ideas, and great input from the community.  Try not to nickle and dime yourself too much.  Focus on the big expenses, make sure you're not lying to yourself too much (we all do it... try to do it less), and have a great time every day.  You'll get there.

Good luck

~ DaftShadow
« Last Edit: May 02, 2013, 11:10:46 AM by DaftShadow »

pop pop!

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Regarding the heating issue, have you considered keeping part of your house partially shut off from the rest (meaning shut the doors when not in use) to save on heating or cooling?  You might be able to vary the heating in your house to mostly heat the rooms that you use (keeping the rarely used rooms at a lower temperature -- this works best if each room has its own thermostat, which is common with baseboard heat).  Could also put up heavy drapes or other window treatments to insulate them a bit better (I once used some old towels for a smaller window in a pinch).  This is pretty common practice in Japan, a place I've lived, where electricity is very expensive.  It's typical for the whole family to spend their evenings together in the common room (kids studying, parents watching tv, etc.). Central heat is for rich people in Japan, and bedrooms are heated only for a few hours before bedtime, and then the heat is shut off at night while everyone sleeps under heavy blankets.

Joet

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not to be a debbie downer [but here it comes], normally 'Nanny' positions spin-out in your early mid/30s when you're no longer that cute/young/etc thing. Unfortunately I've seen this quite a few times with the various people I've seen in this role. Maybe you'll last longer, but you REALLY need a backup career plan.
Also copy-editor sounds like a hot field to enter if print were still a growth industry. Say like 50 years ago.

I think the both of you are doing FINE on expenses. I'm worried about your careers and backup plans. Is there a small-business you guys could launch?

Given that you're both in the NYC area, can one/both of you enter finance/general accounting or even some of the various broker/FA certs?
« Last Edit: May 02, 2013, 11:31:27 AM by Joet »

Dee18

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It's great that you are thinking ahead to your future.  Once you have some ideas of what you might like to do after your nanny job, you could do volunteer or part time work in that area or take an online course to test out your interest. Since you provide most of the income, you do need to be prepared for that transition.   In the meantime, I think you might want to declare a debt emergency.  You and you husband have debt, and almost no assets, with significant income.  I agree with DaftShadow that you want to identify the leak of $1100.  Direct every penny of that income toward your debt.  Then consider other ways to tackle that debt.  You could work part time in your off week and put that money solely toward your debt. Your husband could consider additional work--tutoring?  Teaching essay writing for ACT/SAT?   You and your husband could agree that for 90 days you will not eat out, will try to reduce energy costs (should be easy this time of year), and drive as little as possible (can he ride a bike to at least one of his jobs?) It can be depressing to think about never eating out--but unpleasant things become tolerable when they are for limited time periods (and by then you may get used to them)  Check to see what the penalty is for getting out of directtv--if it's less than $600, cancel it and buy an antenna---there really is still free tv, and tons of shows available via internet.  I live in a drafty old house too.  I just turn the heat off when we go to bed in the winter.  The temperature rarely goes below 50 which is actually a nice sleeping temp if you have a good comforter.  Get the windows unstuck in your bedroom.  (When I complained about my painted shut windows a painter told me any window can be opened, and he did it to one window in my bedroom so I can get fresh air.)   As for where the money should go:  first pay off Mom, then pay off student loan, then establish IRAs and education fund for your future (which could be invested). Postpone car buying until yours dies since you like it and then buy a fuel efficient used car.  Agree with your husband that you will not get any more pets until you are debt free with an emergency fund.  Best of luck!  It's great to be aware of all of this at such a young age.

ScottEric

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Regarding the utility bills, if the place is a good deal otherwise it might be worth spending some time un-sticking those windows and otherwise doing some weather sealing, tossing in a programmable thermostat etc. 

We did some of that when we moved into our apartment and our bills were about 75% less than the previous occupant, plus we kept the heat on higher (the wife won't abide anything under 68).

EK

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Thanks for the input!!  I really, really appreciate people taking the time to wade through this nonsense!

1.  I'm not seeing the $1000 cash flow missing??  Maybe I'm a dope... Like I said I have kind of a numbers mental block and its quite possible that I've miscalculated something??

2. The train travel is hard to get around, and I've tried to think it through.  Maybe if I give more details someone will think of something I haven't.  I actually travel 4 times per month (every Tuesday make a trip between Long Island (NY) and Fredericksburg, VA.  I have tried boltbus, but it stops in DC and getting between DC and fredericksburg at the off times that I travel is very tedious, time consuming, and expensive too.  Going to work I HAVE to be there by the time the nanny kid I'm watching gets home from school.  It's non-negotiable and one of the few things they might fire me for at this point if I started f'ing it up.  There is a greyhound bus that goes to fredericksburg, but it's not reliable enough time wise for me to count on getting to work on time.  The train is very reliable.  It's also a much shorter ride, which gives me maximum time at home which is the best part of the job and the whole reason that its really worth it for me to stick with it.  Additionally, I take a short commuter train between NY penn station and where I work on LI- greyhound doesn't go directly into penn station like the Amtrak does.  Going home, I'm not in such a time crunch.... But I want to be at home!  The time at home is the whole reason to keep the job and if I'm spending 10 hours traveling (surely the kind of people who post in an early retirement forum can appreciate the value of free time)!  So that's where I'm at on all that train travel.

3. I've thought about the house, and it is legitimately a good deal.  A basic apartment in town (very important to be in town so that amenities are walkable/bike-able... Especially with one car and me home all day on my "off" weeks) runs 1000-1200 which is about what we're paying all in for the big, nice house.  Plus we get to live in the big nice house instead of somewhere crappy and small!  We're not willing go into a roommate situation. 



For heating in the winter, we kept it low (62-65) and turned off heat in unused rooms (basement, attic, the 2 extra bedrooms).  As much as possible we relied on electric space heaters instead of turning on the central heat.  Even doing that, the heating cost for december was around $700!!! (we're on a plan where we pay smaller installments all year so single month out of pocket is never that high). Next winter we're going to look into insulating more via heavy drapes and that shrink wrap stuff. 

Anyhow, thanks again for all the input!  Keep it coming! :D

Cindy

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I think people were confused about your cash flow situation.  You said your net income is $6300 and I think they were thinking that was your gross.

EK

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Yes. To be clear, $6300 is approximately what appears in our bank account AFTER taxes.  Our gross combined annual pay is probably something like $120,000.  Not bad for 2 people with fake jobs.
« Last Edit: May 02, 2013, 01:55:34 PM by Evakatharina »

EK

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Let me throw out another question:

Right now starting today, seems like best option for extra money:
- 1/2 towards emergency fund that we will build up until its big enough for $3000 cash flow + enough to replace the car when it dies
- 1/2 towards loan repayment (split between mom and student loans)

Now, after that immediate crisis is solved:
-Mathematically, it is obviously best to pay off our loans ASAP (we can do this by the end of the year if my bonus goes right to the loans).
- Psychologically... we are both super pumped to invest. 
- might it be worth it to divide the resources towards both goals to keep us excited even if mathematically it isn't?

My mom is very forgiving on repayment schedule for the loan, and she is really excited that we're taking the opportunity to buckle down and get our finances secure.  Obviously, she's my mom and I want to pay her back in a timely manner because I value that relationship, but it's really not necessary to apply 100% towards that right away.


I should add, we are both reformed spenders.  Me on stupid girl shit like clothes, nails, makeup, etc.  I've more or less gone cold turkey and it feels GREAT.  Never been happier.  Him on impulse drinks and snacks basically every day which really adds up.  He is feeling deprived- not really to the spending less is more awesome than spending more point yet.  We are both committed, but I am really paranoid about a backslide!!!  I'm desperate to maintain motivation and leave my spending ways behind me!!


I'm going to try and unstick at least some of the windows.  They are painted shut and I assumed could never be opened, but I will try harder now that I know it's possible!!

His work transportation- vehicle transportation is completely unavoidable for the dog walking.  No way around it.  We would be spending less month to month with a more fuel efficient vehicle, but current funds don't allow an immediate replacement.  He walks to his copy editing job which is only a few blocks from our house (another reason to stay)

Our long term job/ money making that I've thought of:
Me-
- I've got some notion of transitioning into free-lance design and creative work.  I've started to test the waters on that and I'm working on building up some marketable skills in that area... I've got a time cushion with my current gig, but it's definitely on my mind.  I have a useless undergrad degree in art history. (Good grades though.)
- another idea for me: go back to school after nanny gig and get certified as an ultrasound technician.  I'm interested in it and it seems to be good bang for the buck as far as cost of schooling compared to average salary.
- another idea: when we have a down payment and buy a house... Buy a multi-unit building and live in one of the units while other tenants pay the mortgage and then some.  Need to research more into local market to see if this is a viable idea, but it's a thought I've had regarding long term.  I love houses in general and home improvement specifically.  Being a landlord is an appealing idea.
- another idea: given interest i have in houses, get a real estate license.
- me going into finance (as one poster suggested- and I thank that poster very much for their time)... lets just say that me doing anything numbers related does not play to my natural talents and chances of success might be low.

Him-
- im not convinced that copy editing is not such a dead field.  Written things still need a copy editor, print or digital, and he is GREAT at it. Easily best copy editor where he works, and he's only a few months in.  We know other people who make a decent living doing it full time. So I'm not dismissing it.
- teaching certification for HS English teacher
- go to school for writing MFA, teach at college level.
- he is incredibly talented with the written word, and while its a tough field right now, I have 100% faith that he can succeed. 
- him going into any numbers-related field would be ridiculous.  Not his talent.

We don't care if we ever make a gazillion dollars a year.  Really.  We have simple needs and wants.  We just want enough to cover our expenses, save responsibly, and provide for one future child.

Dee18

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ultrasound tech sounds like an interesting choice, and would probably permit part time work  if you wanted to also do something artistic. 

Joet

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yea medicine is a great idea---also look at physicians assistant [possibly more lucrative than an MD moving forward]

SunshineGirl

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Have you considered using those extra rooms to offer dog-sitting services? Then you could write off some of your utilities and rent. Even if you only take in 1-2 dogs per month for a couple nights, it's a legitimate business and you could lower your housing/utility expenses that way.

EK

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I have actually investigated physicians assistant a bit too and I haven't ruled it out as a possibility.

Reason for ultrasound tech vs physicians assistant:
- physicians assistant schooling somewhat competitive to get into, and science undergrad is preferred (I don't have that). I also lack some necessary science pre-req's.
- going to a good PA school would be more expensive- you can get ultrasound tech degree at a community college, while to get the most employable PA degree I'd be looking to go back to a "real" college
- if I don't want to work at a proper job all that long (if I could snap my fingers and make a dream life appear, I'd be doing freelance creative work on my own terms, and spending lots of time with future evakatharina jr.) extra school for higher salary might not be worth it mathematically.
-PAs probably need to be better at math-y type sciences to get through school.  I COULD do it, but it would be a struggle.  I'm not a dummy (not by a long shot), but I'm extremely visually oriented and numbers have just never been my "thing".  So PA school seems scary to me.

Does anyone work in the medical field that might have insight about whether my impressions are correct?  I don't know anyone personally who knows anything about it to talk to, so I could be way, way off base.  I'd love some input from someone who knows more about it than I've gleaned with some half-assed poking around on the Internet.

EK

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SunshineGirl-

Wow, I NEVER would have thought about it.  Definitely something to look into.  Might be problematic with our current 3 pets, but that's a really interesting idea that could knock some money off one of our most problematic expenses...

EK

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Okay here's another really weirdo thing I'm just going to throw out here:

The reason that we got directv in the first place is because my Mr. is a huge, HUGE football fan.  He's always been a redskins fan, and he watches every game.  It's just one of his "things".  It's not something he's ever going to just stop caring about to save some money.  It's just not.

Now... When we ditch directv, he is going to be heartbroken if he misses the games.  We didn't have cable for the first few years that we lived together (didn't even have a tv), so we've lived without it and he sort of made-do watching online, but it makes him miserable.  I don't want him to be miserable.

So... My weirdo thought is, what if we got a couple season tickets.  One for him to go to every game, and the other to try to sell for enough money to cover both seats and basically make the awesome fan experience of seeing every game live cost us $0 dollars.  Or even buy 3 tickets and sell two of them.  Now, having bought some tickets on stub hub.... It seems like you can pretty easily get at least double the sticker price on tickets that you're re-selling.  Obv we don't have the cash now, but say we got the cash to pay for the season tickets... Is there a reason that this is not a good idea that I'm not thinking of?

momo

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Okay here's another really weirdo thing I'm just going to throw out here:

The reason that we got directv in the first place is because my Mr. is a huge, HUGE football fan.  He's always been a redskins fan, and he watches every game.  It's just one of his "things".  It's not something he's ever going to just stop caring about to save some money.  It's just not.

Now... When we ditch directv, he is going to be heartbroken if he misses the games.  We didn't have cable for the first few years that we lived together (didn't even have a tv), so we've lived without it and he sort of made-do watching online, but it makes him miserable.  I don't want him to be miserable.

So... My weirdo thought is, what if we got a couple season tickets.  One for him to go to every game, and the other to try to sell for enough money to cover both seats and basically make the awesome fan experience of seeing every game live cost us $0 dollars.  Or even buy 3 tickets and sell two of them.  Now, having bought some tickets on stub hub.... It seems like you can pretty easily get at least double the sticker price on tickets that you're re-selling.  Obv we don't have the cash now, but say we got the cash to pay for the season tickets... Is there a reason that this is not a good idea that I'm not thinking of?
Why not just stream it online instead? Definitely will save you two money.

EK

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He did that back before we had cable and didn't live in the redskins local market, but it never really worked the way we wanted it to.  The feed would always cut out during some crucial play and his grumpiness over it turned him into a monster :/. So I've been trying to think of something else to satisfy that hobby and keep him happy.

momo

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SunshineGirl-

Wow, I NEVER would have thought about it.  Definitely something to look into.  Might be problematic with our current 3 pets, but that's a really interesting idea that could knock some money off one of our most problematic expenses...

Perhaps you can store your pets elsewhere in the house, or in the garage or or in-law unit if the house has one? That way you can free up the backyard, garage or other parts and dedicate it to the potential pet service?

Expanding to have more dog walkers on your team might be good too. More hands can help increase productivity. How about offering extended pet sitting services on your property? This can work if you can securely store them in the garage of some other parts of the house. How about bundling taking pets for owners to the vet and/or grooming services? Have you looked into adding these too? Definitely consider expanding the services you offer since you two have time and energy to handle this until you two decide to have a kid.

Owning pets is expensive and takes a lot of sacrifice and dedication. I can relate b/c I have two dogs Akitas; they are wonderful companions, but rapidly aging one is 11 and the other 9. Once they pass I won't get another pet b/c I am long overdue to downsize and sell the house. In my area not having pets offers more flexibility which is what I want, especially when raising a family. Good luck.
« Last Edit: May 02, 2013, 05:04:44 PM by StashtasticMomo »

footenote

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Two ideas:
1) While I agree that you could "age out" of nanny-dom eventually, have you considered finding a nanny gig in DC? If you could match your current rate, you could potentially go FT, commuting home each weekend. Fred'berg <---> DC = much lower transportation expense and opportunity to go FT (M-F). And you would double your nanny income.

2) Could your Mr. expand his dog walking business? What if he became not only a dog walker, but a recruiter of other dog walkers, business manager?

You are both so young - consider lots and lots of alternatives. That's the way to think your way to Mustachian-ismo! Congratulations on taking the first, most difficult steps.

momo

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He did that back before we had cable and didn't live in the redskins local market, but it never really worked the way we wanted it to.  The feed would always cut out during some crucial play and his grumpiness over it turned him into a monster :/. So I've been trying to think of something else to satisfy that hobby and keep him happy.


Maybe he can join a social group that watches the same team as him? Has he researched local meetup groups? There might be a social group that already exists that enjoys the Redskins too and he can share with them? And if one does not exist, perhaps he can start one? Or does the local sports bars broadcast the games?

Also just my ten cents but it sounds your husband might benefit from being a bit more flexible with his luxury hobby.

DaftShadow

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Yes. To be clear, $6300 is approximately what appears in our bank account AFTER taxes.  Our gross combined annual pay is probably something like $120,000.  Not bad for 2 people with fake jobs.

The most important formula in all of finance is  "Income - Expense = Savings."  If you have X dollars every month in after tax income, and Y dollars every month in spending...  then you will also have Z dollars in "savings" each month.  X - Y = Z . 

X = 6300
Y = 3500

6300 - 3500 = 2800. 

This shows that, if everything you have written is true, you should have a surplus of $2800 every single month, right now!  If you've had these jobs for 6 months, then by simple math I can assure you that you must also have $16,000 in the bank!!

However, since you do not have that much money in your bank accounts, what this tells me is also very simple:  Either (a) you are making less money than you think, or (b) you are spending far more money than your list of expenses shows. 

There is literally no other way to explain your situation.  One of those two numbers *must* be dramatically incorrect.

You *must* figure out what the true answers are, or you will never be able to dig yourself out.  Nothing else is more important.  Not your TV patterns, not bicycles, not housing expenses, not lunches with mom.  Ignore them.  Keep your eye on the ball:  Re-focus on getting true and accurate numbers.  Find out what you are truly spending your money on.  I promise you, it will be the most important thing you ever do for your future success. 

Good luck

~ DaftShadow
p.s. A hint to get you started:  sometimes when people have major "missing expenses" each month, it comes in the form of cash spending.  Are you withdrawing more than 1000 in cash each month?  If so, I can almost guarantee that your estimates of spending are incorrect, and much much higher than you think... 

EK

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Ahhhhh gotcha.  I see the confusion.

We started this budgeting business in January, but we were wiped out by the tax issue (paying back taxes and getting ourselves together for appropriate quarterly payments), getting those credit cards cleared and some other little issues not worth going into. Now that April (and that stupid tax disaster) is behind us, we are basically starting fresh.  May is our first month that we won't be using the extra money we've found in the budget by cutting out all the stupid crap, so this is the first month that we'll be able to actually do anything with the extra money that we will have now going forward.  We have managed to solve the mystery of where all the money was going to.  $2800 is a staggering amount to have squandered every month for the past 3.5 years and I'm appropriately ashamed. :(

So in 6 months we should have a good chunk of that student debt gone forever and we should have some money in the bank!!  With my bonus, I think we can aim to eliminate the student loans by end of the year (especially if mr.'s dog walking picks up in the summer like last year)!!!

So basically we can consider may our big start and were just figuring out where to go from here!!
« Last Edit: May 02, 2013, 08:53:14 PM by Evakatharina »

DaftShadow

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That explains it... 

Well, your money plans for the next few months sound controlled.  Trust yourself here, you know what you're doing now.  Once you've got that debt under control, might I recommend JLCollins thoughts on his Simple Path to Wealth?  It's a good path to take you the rest of the way. 

It seems you are about to experience an exciting year!  ;)

~ DaftShadow
« Last Edit: May 02, 2013, 07:51:44 PM by DaftShadow »

kkbmustang

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If the Mister is good with copyediting, he might also consider freelance writing. He could target pet/animal related industries with his experience with animals. Check out www.thewellfedwriter.com or www.makealivingwriting.com. Tell him to stay away from content mills. Good freelance writers should make $50/hour minimum.

EK

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I will check out The Simple Path To Wealth from the library!   And hopefully I'll be able to come back to this thread in a few months with an update on how much money we're saving up and how much our debt is shrinking! :D

Kkbmustang I am very glad you mentioned freelance writing and put up those links.  He's definitely capable & qualified.  He read the whole thread and we discussed the suggestions, and when the suggestion to pursue freelancing comes from someone other than me he seems a lot more into it!! I think he's going to go for it!!!!!!


Haha, my mr. is also concerned that I made him out to look like he's dead weight in this relationship.  So I'd like to go on record as saying that he's not! Our income is unequal right now, but the tables may one day be turned, and he does a lot to hold up his end of things by taking extra hours at work when he can and helping a whole lot at home.  So don't judge him TOO harshly.  Plus, he's pretty cute I guess. ;) He may be responsible for the directv, but I'm 100% responsible for those money-pit pets (CUTE money pits!) that waste a lot more money than his football.  And I've contributed WAY more than him to our past over-spending problems, so neither are blameless here!

dorothyc

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I can highly recommend You Need A Budget - it lets you see exactly where you are each month - zero based budgeting - and you can have a conversation with your spouse about where the extra money needs to be focused without you seeming the bad guy all the time. Typical conversation might be - " Well, we planned to pay that much to the debt, but after we ate out every week we can now only afford to pay this much."

They offer a 34 day free trial, which is a full version of the software, and if you like it, you just purchase and apply your registration code. The forums are great and they offer free webinars on a regular basis.

http://www.youneedabudget.com/

kh

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Another thought on that train expense - pay for it with pre-tax dollars.  Up to $245 in public transit expenses can be paid for with pre-tax dollars if you use it to commute, I use this to take some of the bite off of my monthly train ticket I use to get to work.  I think you have to work through your employer for this benefit, but it costs them nothing, and saves you probably... $70/mo in taxes?  Might be worth agitating for.

http://www.kiplinger.com/article/taxes/T054-C001-S001-tax-benefits-for-using-public-transportation.html

EK

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Another thought on that train expense - pay for it with pre-tax dollars.  Up to $245 in public transit expenses can be paid for with pre-tax dollars if you use it to commute, I use this to take some of the bite off of my monthly train ticket I use to get to work.  I think you have to work through your employer for this benefit, but it costs them nothing, and saves you probably... $70/mo in taxes?  Might be worth agitating for.

http://www.kiplinger.com/article/taxes/T054-C001-S001-tax-benefits-for-using-public-transportation.html

I had no idea about that!!  I think I'm going to have to pester my employer to get that set up for sure.  Thank you.

Hotstreak

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Evakatharina, what do you do on your weeks off?  I realize as a traveling nanny you are away from home and put in substantial hours, but do you really need to take the whole week off between?  What about filling in at a daycare, babysitting, or tutoring a few hours a week while you're at home?  Housekeeping is another income source that you might have some skill transfer on (assuming you clean up after the kids), and many clients only want you there every other week or once a month.  You could schedule these extra hours while your husband is working so you don't miss out on family time, and rake in a decent amount of extra money while you're at it.  Even without a car you could perform those services in your neighborhood by biking or walking.

As far as your question, it looks like you should establish a larger emergency fund.  If your husband broke his ankle not only do you have expensive bills, but he may not be able to walk dogs for a while.  If your employer moves too far away, or for any reason at all decides to stop or reduce your services.. you are in a world of hurt!  Your eggs are literally in one basket in that regard, I would be very cautious relying on your one client (which you say is irreplaceable) to never change their mind about your services.  Quite scary.  After you build 6 months living expenses, focus on attacking your loans, then worry about investing or saving for a home.

Good luck!