Tuesday, June 30, 2009

2008 Taxes UGH.

Due to circumstances that are mostly my fault (and will be blogged about in future posts), I owe big time money to the government (both Federal and state). I had been putting off dealing with it, because it just depresses me to think about how much money this is that I don't have. But since I got another notice from Uncle Sam the other day and today is payday, I figured better do it now.

I owe (including most recent penalties and fees)...

Federal: $3,876.88
State: $1,185.43

Yes, ouch. Big time.

Anyway, a while back, I got a horrid piece of junk mail from Capital One that promised that I could get a credit card with no interest for a year. So, on a lark, I figured that I could pay a big chunk of the debt to the government that way, and pay off the card no interest before June 2010 (one year later). So, I applied online, hoping that they'd tell me what the credit limit would be and that I could accept or decline. Unfortunately, there was no such thing. And about a week later, I got a card in the mail saying that I had a $500 limit.

Well, crap. The limit isn't really enough to pay anyone in full. So, I put it off to the side and didn't think about it.

Tonight, I figured that I'd spend the $400+ in my savings on the taxes to get the ball rolling. I looked online at the Federal website, and I saw that I was eligible for a monthly payment plan. So, I signed up for that and promised to pay $250/month (I'll probably send more), until it's done. It also says that if I am eligible for a refund for 2009 that they'll apply the refund to my balance instead of sending a refund. That will be nice, since now that taxes are being withheld (they weren't before), I'll probably be getting a small refund. So, Federal is taken care of, for now. My first payment is due in August.

As for state, no such luck. So, I went online and paid $400 on the Capital One card (for a $9.96 fee), and I used their bill to mail them a check for an additional $350, which is coming from my savings. This should bring my balance down to $435.43. That's way more manageable.

It's going to suck major ass not being able to put much money in savings, but I was only putting money in savings now to pay the taxes later. So, it evens out. Plus, I'll be reducing fees by paying the state taxes off in the next few months. And I know that I just increased my credit card debt some, but it's interest free for a year, and I can pay off the $410 in a year (well, 11 months). And I'm not going to use the card for anything else. It's already in the drawer in the kitchen and not in my wallet.

And this has been way too much dealing with money for one night. I need some Toaster Strudel.

Trying a new way to save money away.

The other night, I was reading The Simple Dollar, and he posted about a two-account system for savings. And I've been thinking about this ever since in the back of my head. I think that I an adapt this for my own routine. So, here's my plan...

What I would ordinarily do is on Bill Day I'd transfer the difference of my checking account balance and my paycheck to my ING savings account. This works, but it leaves me to my own devices for the whole month with my whole paycheck. This is not always the best thing, especially when I get in one of my "shopping therapy" moods.

So, my plan is this. Once all the bills are paid, I'll transfer nearly all of my money out of my checking account into my savings leaving only $100 behind. On one day, each week, I'll set up an automatic transfer of $100 from my savings to my checking.

Hopefully, this will (a) force me to subsist on $100/week, (b) have more money in savings at the end of the month, and (c) gain a small amount of interest for having more money hang out in savings longer. Of course, the ultimate goal of this money is to pay off my 2008 taxes by the end of the year (an not go to prison). I'm planning on writing a post about the whole taxes thing later tonight, so hold on for more details.

Anyway, I'm going to enact this plan for July and cross my fingers that it works (and that I don't overdraft my checking account.

Bill Day (July 2009)

Today was payday, which can only mean one thing... it's also Bill Day.

This is the first "official" Bill Day since starting my blog. I anticipate that this will be easier than usual, since I've been putting my receipts in the Quicken each week for my Where'd my money go? posts.

(1) Balance checking account

(20 minutes later...) Starting Balance: $4,016.29

(2) Ordinarily, this is where I'd transfer the difference between my paycheck and the balance to savings. But, as I'll post about once this is finished, I'm going to try something new for July. So, we'll leave the full balance where it is... for now.

(3) Bills

Rent: $925 (I posted before about my rent being annoyingly cashed late. So, today I got a money order at the bank. Luckily, I know the people at the bank really well, and they waived the $5 fee for me.)

Insurance: $75.16

Care Credit: $1,176.26 (Balance Paid in Full! Thanks Laura for the advice, and thanks mom, for the money.)

CitiLoan: $217.19
Cell Phone: $50.97
CitiCard: $170
Student Loan: $105.66
Gas: $38.45
Cable: $70.85
Electricity: $65.09
Mastercard: $131.00
Netflix: $18.01
TiVo: $13.08

Total Bills: $3,056.72

Money Left for July: $959.57

It's Tuesday... Where'd my money go?

I've been off my schedule this month due to unforseen circumstances. So, here's my "Sunday" post on Tuesday. It's also the end of the month, and I've been thinking about some new things lately, so I'll probably make a few posts tonight.

It's Tuesday... Where'd my money go??

June 23 - 30, 2009

$8.99 - Amazon.com - I was week. I saw Black Sheep via Netflix over the weekend. And it was just so fabulous that I had to own it. Luckily, it was under $10, or I probably wouldn't have bought it.

$35.21 - Target - All necessities: shower stuff, mouthwash, laundry detergent, drinks ($0.79 vs. $2.25 at work), and cat litter. Plus, I had to get some new headphones, because I keep breaking the ones I have, but those were only $10.

$11.12 - 7-11 - UGH. Yes. Cigarettes. It was a 2-pack sale deal, but still. I need to quit. It's just so difficult right now.

$27.75 - 7-11 - Gas for the car. An unfortunate necessity.

$19.86 - Groceries

$12.05 - The Little Store - Drinks at work and a pack of cigs. (I should be slapped.)

$7.14 - 7-11 - Cigs again. Seriously? That's for one pack and nothing else. I remember when I was pissed that the price went up to $2.50/pack. I really need to quit.

TOTAL MONEY SPENT (Debit Card): $122.12 (ouch)

Now for the cash...

Starting cash $14

$85 - Cash Withdrawl (one $50 and one $35)
$5 - Tuesday Lunch
$8 - Wednesday Lunch
$13 - Thursday Lunch (big group lunch out for Chinese buffet)
$5 - Strawberries (big group out berry picking on Thursday)
$1 - Drink on the way home
$6 - Friday Lunch
$4 - Walgreens (needed Tums at work)
$12 - Saturday Lunch (for me and J, whom I owed for dinner the night before)
$3 - Weekend drinks
$6 - Monday Lunch
$5 - Tuesday Lunch
$3 - Extra drink at work today

TOTAL CASH IN: $99
TOTAL CASH OUT: $71

Difference: $28

Actual Cash Left: $28 YAY! Balanced.

Monday, June 22, 2009

What to do with $1,000?

So, I got $1,000 from my parents to help cover the vet costs. So, where's the question? Use the $1000 to pay the vet bill. But here's my conundrum...

(1) The vet bill is $1176.26 that is on a credit card that is only usable at the vet and is interest free for 3 months.

(2) I owe a total of about $5000 in state and federal taxes for 2008.

(3) There's only about $330 in my savings account.

So, what should I do?

(a) Pay the vet bill in full and have a net loss of $176.26 in my accounts.

(b) Use the money to pay part of my taxes right now, which would reduce fees and penalties that would be accrued over the rest of the year.

(c) Put the money in savings to gain a bit of interest until I eventually use it to pay the taxes at the end of the year.

I can kind of see the up-sides and down-sides to each option. Of course, no matter what option I pick, I need to tell my mother (when she asks) that the money did go to the vet bill. But she has no clue of my overall financial status. I think that right now, I'm leaning toward paying the state taxes with this money. The state tax has the lower amount owed, and with this money and what's in savings now, I could probably pay the whole thing in July. This would mean ZERO penalties and fees from the state of CT, but no payment to federal.

Hmm. I, of course, welcome opinions and additional options. I just deposited the check today, so I'm going to have to wait a few days anyway to make a final decision on this money. I just wish that things weren't so complicated right now.

It's Monday... Where'd my money go?

I was too tired last night to write this post. But now I'm home, watching The Young & the Restless (my newest addiction), and ready to pour over my spending from the last six days. Due to my busy weekend, last week's Sunday post was postponed to Tuesday. So, this is only covering from last Tuesday through today.

June 16 - 22, 2009

$9.13 - 7-11 - Yeah, it was a shitty week, so yesterday, I went out and got some cigarettes. UGH. I wish that Toaster Strudel was my only vice.

$7 - Cappuccinos - Friday's comfort lunch of pancakes. YUM!

$32.11 - Target - Target is a wonderful store that has the power to SUCK money out of me. They were having a great DVD sale. (Major League for $3.98 and House Season 4 for $18.99! I couldn't say no.) The rest was groceries, which did include the best Toaster Strudel of them all Strawberry & Cream Cheese.

$6.65 - Dunkin Donuts - Bagels for lab meeting. It's the tradition that the person presenting at the meeting in the morning buys breakfast for everyone. Seeing as how I only present about four times each year, it's not too bad.

$7.47 - The Little Store - Snacks and drinks at work. Sigh. I need to stop doing this.

$13.96 - Krispy Kreme - Donuts for lab meeting. I drive way out of my way to get Krispy Kremes for the meeting instead of walking the 1/2 block to Dunkin Donuts, because Dunkin Donuts is the spawn of Satan. Plus, everyone gets Dunkin Donuts; it's nice to mix it up. (Krispy Kremes are WAY better.)

$8 - Groceries

$14.29 - 7-11 - Yes, the shitty week required more cigarettes that I would like (ideally, none).

$84.42 - City Tax - UGH. It's once a year, and it always surprises me. But it's based off the value of my car, since my car is a POS, it could have been a lot worse.

$1176.26 - Vet Bill

+ $55.36 - Surprise settlement money

+ $1000 - A gift from my mother to help defray the vet costs.

Now for the cash...

Starting Cash: $3

$35 - Cash withdrawl
$10 - Thursday Lunch (me and a friend to whom I owed a lunch)
$6 - Monday Lunch
$7 - Coffee at Target ($6.31, but the change went in the change bucket)

TOTAL CASH IN: $38
TOTAL CASH OUT: $23

Cash left over = $15
Actual cash left over = $14

Just remembered I gave Lyndsey $1 for a lottery ticket. So, WOO! Balanced.

TOTAL MONEY SPENT THIS WEEK: $1,394.29 Of course, this is far from a usual week. But there are places were I could have definitely spent less money. And thank my parents so much for that extra $1000 to cover most of the vet costs.

Additionally this week, I blogged about this when it happened, but it's worth mentioning again here. I opened a new ING savings account with $20 for future vet costs for my surviving cat.

Also, my Amazon Prime membership was up for renewal. Since I'm curbing my spending all over the place, I decided that I'd be spending less at Amazon in general, so I wouldn't use the Prime as much. I canceled the membership and put the $79 that I would have spent to renew the membership into my savings account. It's a win-win that will hopefully pay off in the long run.

Sunday, June 21, 2009

Posts coming soon

I know that I'm still really new at this whole blogging thing (aside from my personal journal) and that there aren't very many people that read this or expect anything from me. But I just have to apologize for the lack of things going on with Addicted to Toaster Strudel lately. I still need to write a few more history posts, and I need to do this week's Sunday post. But today was just one of those days where it's so difficult to make myself do anything. Part of it is that I'm planning a trip to the bank tomorrow, and I wanted to write it all in one post. And part of it is that it's just been a difficult week in general.

But I'll get better. I plan to write the Sunday post tomorrow after work.

Wednesday, June 17, 2009

13 Hour Vet Crisis and a Plan for the Future

Last night, I had to take my cat to the vet. It's been a very difficult time, and I've blogged about the details in my personal journal. But there are some financial things that I wanted to discuss that seemed inappropriate to post there.

Last night, I learned that my cat was way more sick that anyone originally thought, and he required an overnight hospital stay. I was prepared to spend a few hundred dollars getting things taken care of, but I got a that what I thought was constipation from a hairball actually being advanced cancer and at "deposit" for the hospital stay of $1,306.

I was not prepared at all for that. Even if I sold my car on the spot, I couldn't scrape up $1,300. But the vet has a credit plan, and she signed me up for it. I was approved for a $1,500 limit. The good things about this is that most importantly, the vet got paid and my cat got some help and the account is interest free for the first 3 months. The downside is that this is $1,500 in the wrong financial direction with more credit cards. But, you have to do what you have to do.

This morning, things got much worse when my cat's health deteriorated rapidly. Sadly, he needed to be put to sleep. And as awful as that was, I know that he's not hurting any more, and he's with his old pal (another cat that passed in 2005) in Kitty Heaven. Dealing with all of this is extraordinarily difficult, but still, you're at the vet and there are money issues to handle. Luckily, because he passed before the more detailed tests that were scheduled for this afternoon, my deposit was an overpayment. So the credited my account $129.74.

I talked with my parents (they were here visiting this weekend and saw him and helped when we thought he was just constipated), and they offered to send me a check for $1,000 to go to my cat's final expenses. This is an incredible gift that will definitely help off-set my costs of last night. She also demanded that I get vet insurance for my other cat.

I looked into vet insurance yesterday (ironically) before taking my cat to the vet. It sounds like a good idea on the surface. However, reading into it and how it works, it doesn't sound like it's going to work for me. Based on what I've read and talking to Dr. Faith, it looks like if your cat is in good health and needs only minor and routine visits to the vet, getting the insurance is actually costing more money than paying the vet directly. Odd. Plus, the insurance doesn't actually pay the bill. They are reimbursement plans. So, not only would I need to pay $30-50 each month in premiums, there'd be a $50 deductible per visit, and I'd have to pay the whole bill myself and then get reimbursed. For me, at this time in my life and situation, it makes more sense to open a new savings account and deposit $30-50 each month. In addition to saving the cost of the preimiums, I'd be earning interest as well. I thought about it more this morning, and that's what I've decided to do. Thirty minutes ago, I opened a second ING Savings account that will be strictly for vet funds.

Here are a couple of links that I was reading, if you're interested: Veterinary Pet Insurance and ConsumerReports: Pets & Vets, is pet insurance worth it?

Tuesday, June 16, 2009

Where'd my money go? (addendum)

I just figured out why my cash totals were off.

I said that I should have $2 left over, but I had $3. I forgot that I started with $7.

That makes...

CASH IN: $59
CASH OUT: $50

And means that I must have paid $6 to park at work on Sunday, which was the only cash transaction that I forgot to write down.

That leaves $3 left over, which is what I have! WOO! I balanced.

It's Tuesday... Where'd my money go?

I realize that I intend to do this post on Sundays, but my parents were here for the weekend. So, I'm doing it on Tuesday instead. That makes this "week" long and next "week" short. Oh well, it's blog, I'll do whatever I want. Deal with it. =)

June 8 - 16, 2009

$7.01 - Walgreens - Drinks for at work. Grr. It's a dirty habit, but I need an afternoon drink at work. But, I got $2 cash for buying a drink for a friend that didn't go to the store, so really, it's only $5. We'll balance out the cash at the end.

$9.28 - Walgreens - UGH. Snacks and drinks for work. Seriously? I'm a snack-whore, I guess.

$23.44 - Groceries - Reasonable.

$15.60 - 7-11 - Gas for the car.

$13.31 - 7-11 - A drink for the road and two packs of cigarettes. UNACCEPTABLE! I'm shaming myself right now. Really? I didn't need to spend $10.49 on DEATH! Plus, now I know that I can get my drink from the grocery store at 5/$5 instead of paying $2.19 at 7-11. That's way better! Live and learn.

$31.13 - PetCo - My cat's not been feeling well, so this is extra cat expenses, but worth it if he'll just poop already.

$10.45 - Ikea - Probably unnecessary. $2 on lions (I would have bought more, but I only found 4 in the bin). Lions are a really bad habit I should break. They're only $0.49 each, but seeing as how I have about 400 of them... I've spent roughly $200 on little stuffed lions, and that's retarded! I also got some more hangers (8 hangers for $4, not a bad deal), but I've been living without these extra hangers until now, so I probably could have gotten by without them. But I'll use them. This is what happens when the driver of the carpool wants to stop places on the way home. I have no impulse control. I'd have spent $20 on lions, if I could have found 40 of them. Retarded!!

But that's it for Debit card transactions. Not bad for 9 days. ($110.22) Okay adding it up, it sounds like a ridiculous amount of money to spend on things, when really only $70.17 were necessary. I could have not spent $40.05. Again, something to work on.

Now for the cash. Per last week, I had $7 cash.

Cash In:
$45 - ATM withdrawl
$2 - from JP for a drink
$5 - from mother for airport parking

Cash Out:
$6.50 - Monday Lunch
$7 - Tuesday Lunch
$3 - Tuesday Drink ($2.33 $0.67 into change bucket at home)
$6 - Wednesday Lunch
$7.50 - Thursday Lunch
$4.50 - Thursday Airport Parking
$4 - Monday parking at work
$2.50 - Monday Airport Parking
$7 - Tuesday Lunch
$2 - Tuesday Ikea hot dog and drink

Cash in hand now: $3

TOTAL CASH IN: $52
TOTAL CASH OUT: $50

I should have only $2 in cash, and I know that I paid to park at work on Sunday (I don't remember how much). So, I'm off somewhere. I'm still not used to keeping track of cash).

TOTAL MONEY IN: $107.36
TOTAL MONEY OUT: $244.64

The totals reflect additions and subtractions from today's mail, and those transactions aren't listed above (mainly because I wasn't sure where to list them. (+$55.36 and -$84.42)

Seriously, no more frivolous spending. **kicks self in face** But really, June is more about keeping track of things so I know how and where to change things for July and the future.

An interesting day at the mail box.

So, I was planning on making some of my posts that I'm behind on tonight after I take care of some things. But I was so excited about the mail, that I had to share this before I did anything else.

At first I was worried, because I saw two envelopes from some random lawyerly sounding place. I immediately jumped to worry and dread, because I'm a very nervous and high-strung person. I opened the first one and this is what it read...

    Dear Consumer:

    The Federal Trade Commission...filed a lawsuit against...(long list of names). The complaint charged that the defendants were billing consumers without authorization for alleged visits to websites. Consumers saw charges on their credit card bills under the names...(long list of names). The defendants bought access to lists from a bank that provided the account numbers for more than 3 million valid Visa and MasterCard credit cards. Rather than use the lists to confirm that potential customers had valid cards, the defendants debited the cards for web site services the cardholder had never used.

    The unauthorized charges were incurred by you many years ago, and you may no longer have the credit card that was charged. The enclosed check is your share of the funds collected.

    ...(more details that are irrelevant here).


At the bottom is attached a check for $27.68! And I got two identical letters! That's $55.36! And that's totally awesome. The sad thing is that I probably never noticed the unauthorized charges way back when. I had really bad habits, and even though I was scraping by to pay the minimums each month, I never took the time to look over statements too carefully. So now, I get a little extra money this month!

Unfortunately, this is canceled out by a third piece of mail. A statement from the city for 2008 taxes for $84.42. Luckily, the tax is based off of the value of your car, and I drive a piece of crap. So, the tax could be a LOT worse. And I have these mana from heaven checks to help offset the tax. So I'm only out $29.06 instead of the whole $84.42.

Plus, I got a late birthday present DVD from a friend, so it really was a banner day of mail today. Hopefully, I'll be able to get to some more posting tonight. I still did to do the "Where'd my money go?" and "History of My World Part III" posts. Fingers crossed that that actually happens tonight.

Monday, June 15, 2009

Frustrated as Frak

I haven't posted for a few days, mostly because my parents were in town, and I'm completely wiped out. I never like to do this, but I'm posting a little snippet from work.

I'm just really pissed at my landlord. Why the hell is rent due on the 1st, and I get charged a late fee if he doesn't get my check by the 5th if he's not going to cash my rent check for weeks and weeks. It's the 15th, and my rent money is still in my checking account. For some people, this isn't a problem, because they have a month or so cushion in their accounts. But for me (and others I know), this is a dangerous thing to do, because I live paycheck-to-paycheck. If I'm not paying close attention to what's going on, I can easily overdraw my account and bounce my rent check, all because the landlord holds onto the check for weeks longer than he should. I've done this before, it's not pretty.

Luckily, I've set up Bank of America to email me every morning with the balance in my account. That's how I've caught it this time. As much as I would LOVE to actually have the $1550+ in my account like it says, I know that $925 of it can disappear in an instant. I'm contemplating enclosing a little note next time asking him nicely to cash the check promptly. I don't know if this is an assholy thing to do or not. But I may just do it.

Sunday, June 7, 2009

It's Sunday... Where'd my money go?

When I first started thinking about this blog, I thought it would be a good idea to sit down every night and post about what money I spent that day. In practice, this is not a good idea, because it invites failure on my part. It would just be too easy to fall behind.

So, a happy compromise was found, and here's the inaugural post of this type. For me, Sunday is the end of the week. Monday is just around the corner, and another week of work is about to begin. It seemed only logical that I should post about my spending tonight. Also, posting about what I spent where and on what is an excellent way to keep tabs on myself. If I know that I'm going to have to justify a purchase to the blog, I may think a bit harder before I actually buy it. Plus, this will make Bill Day a lot easier, because I won't have a month's worth of receipts to enter into the Quicken, as long as I enter them on Sundays along with this post. So, without further ado...

It's Sunday. Where'd my money go? (June 1 - 7, 2009)

$32.97 - Amazon.com - Timecop, Blade - Trinity, and Repo! The Genetic Opera DVDs. Yes, it's a splurge, but they were all on sale and all cheaper than the equivalent at Best Buy or Target. Plus, I get free shipping, so it's there's no extra cost. However, I need to note that this is a splurge and should not become a habit. Typically, I'll limit myself to one "frivolous" Amazon.com purchase per month; it's just sad that it happened in the first week.

$14.50 - Snacks at the movies - A friend took me to see Star Trek this afternoon for my birthday. He paid for the movie, but I felt bad (he and his wife are just as poor as I am), so I offered to pay for snacks. He gave me $5 cash for sharing.

$5.56 - Groceries - No biggie.

$26.90 - Walgreens - I went to get a new inhaler and picked up some drinks and candy for my desk at work. So, it's $21 necessary and $7 junk.

$42.99 - Best Buy - Guitar Hero Metallica. Okay okay. Yes, bad idea. But it was a present for myself for my birthday. That's okay, right??

$27.84 - Target - Okay, Target is one of my weaknesses. I can easily spend hundreds of dollars at Target without blinking. I've gotten better over the years, and this trip wasn't too bad. Household items, shower supplies, and (of course) Toaster Strudel.

$5.48 - Dunkin Donuts - Breakfast before work on Friday. **sigh** It's hard to resist the ham, egg, and cheese croissant.

$12.57 - The Little Store - That's the nickname we have for the store under the parking garage at work. This was a totally avoidable expense. I spent $6+ on a pack of cigarettes, which will hopefully be my last. I just needed to get through the weekend and get a drink for me and my friend while we were working on Saturday. The cigarette spending will disappear this week, I promise.

CASH - My major cash expense for the week is lunch at work. It's difficult to keep track of, but we'll see how we do. I started the week with whatever cash was left from last week, plus $20 cash in a birthday card. Plus a $25 birthday check from my mother. And during the week, I withdrew $50 from the bank. That's roughly $100 cash to start (following Sundays will have a more accurate cash start count), and I ended today with $7. So, where the frak did that $93 go?? Approx $7/day for lunch at work ($42). Chipping in for dinner with friends on Friday ($14) and ice cream out afterwards ($3). That's only $69. My guess is that I ate the rest ($24) in snacks and drinks at work. Holy crap!

TOTAL MONEY IN: $45
TOTAL MONEY OUT: $150.17 OUCH!

Cash remaining to start next week: $7

Here's my promise to be more frugal this coming week. Shouldn't be too hard, my parents are coming for a visit this weekend, and they'll likely at least chip in for some expenses.

Friday, June 5, 2009

History of My World - Part II

I was just sitting on the deck with the laptop, headphones, and a cigarette (yes, quitting is still a goal) trying to get comfortable to start Part II of my financial history. The rain is nice and relaxing; however, it's just too chilly to get comfy outside to focus. Now, I'm snuggled in my bed with blankets and Shamus the Bedtime Whale. That's spelled like Shamu but pronounced like Seamus (an Irish dude's name). The Captain just joined me on the bed, and that can only mean one thing: it's time to get serious about blogging. So without further ado...

Part II: The College Years (mid-1990s; Age 18-22)

Unlike the majority of people I went to high school with, I decided not only to go to college but to go to college and NOT live at home. This without a doubt can be counted as one of the best decisions I have made in my life. It's just one of those things. Being raised to be independent, I needed to get out on my own. I moved out of my parents place, and really, never went back.

College was a fantastic time in my life with many, many personal discoveries and life decisions. Most of the talk of college isn't really appropriate here, and I think that most people that go away to college have similar experiences on some level. It really is about getting out on your own, meeting people, gaining knowledge (both book learning and life learning). Of course, what I'm going to focus on is my financial learning, which save for a hard-earned C in Economics class my senior year is real life learning. Unfortunately, the real learning for me happened in retrospect years later.

Right off the bat, I have to say that NONE of this would have been possible without my parents. My story would have been very, very different had they not made the choices for me that they did. During the early years (discussed yesterday), my parents were socking away money for college for both me and my brother. Having grown up and done the college thing themselves, they knew that my brother and I needed the college fund as well as a college education. I got a small scholarship that paid a portion of my tuition (as long as I maintained a 3.2 average). The rest of everything was paid for by my parents. They told me several times that the didn't want me distracted having to worry about money for school or having a job and wearing myself out. The ultimate goal was for their son to get an education and join the world with no debt from school. I will be forever grateful for this, and I don't think that I really thought about this much during my time at school. Unfortunately, I don't think I fully expressed my appreciation to my parents for their hard work behind the scenes of my education. I'm going to have to rectify this.

Even today, I'm not entirely sure how my parents managed to pay for four years of a private university for me (and my brother). But this is what I do remember. I had offered to take out student loans to help out, but they insisted that I not do that. Instead, they paid my tuition, room, board, books, etc. on their Visa card. It seems kind of insane to do such a thing, but they had a scheme. Their Visa card gave them points for air miles and miscellaneous things, which they needed and used. Then, they paid off the balance in full each month from the college fund, which netted them very few finance charges. Pretty, smart I think.

Anyway, how this relates to me, I really had nothing to worry about financially in my first two years of school. I lived in the dorm and had a meal plan through the university. My parents paid for bills and supplies. And then there was The Credit Card. Given to me again to cover emergency expenses, groceries, trips to Target, and what not. Also, my minuscule savings account from high school had money place in it for when cash was needed. Looking back on it now, this was the perfect set up for me -- had I not been an ungrateful brat at the time.

Quickly I developed abusing schemes involving The Credit Card. The mini Post Office at the local grocery store sold money orders that could be paid for by credit card. I joined a mail order CD club, and paid for my CDs with money orders bought with The Credit Card. Receipts from which were marked as from the grocery store. So, all the parents knew was that I was buying groceries, which was an approved use of The Credit Card. I do believe that sometimes, I'd use The Credit Card to buy groceries for friends in exchange for cash, as well. Eventually, the mini-PO stopped selling money orders on credit cards and that scheme ended.

At the end of my freshman year, I was approached by one of my professors about doing some summer research. Faced with the facts that (1) I didn't want to go back to my parents' house for the summer, (2) I really loved science, and (3) I wanted/needed extra money, this was a win-win-win situation. My parents loved the idea as well, and thus I started spending summers at school working in the lab. During the school year, I got class credit and I was paid in the summers, and I never had to live with my parents again. That first summer, I had to move out of the dorm and into a house with five strangers (I sublet a room from a guy I found on a message board for the summer). I reiterate that this was another great decision. Not only did I gain work experience and stay away from "home", I met one of my best friends of my whole life that first summer. We're still friends to this day. And seeing as how I was living at school for the summer, learning and working, my parents were happy to pay the rent for the summer. My pay check paid for me to do fun things or buy groceries and stuff.

The next year was back into the dorm, and really nothing of too much consequence financially. Other than to say that sophomore year is when the smoking really kicked into high gear. I dabbled at parties and social things my freshman year. But that second year, it was apparent that I was addicted. I'd go out and talk with friends in the 10 minutes between class and smoke. I'd smoke on the way to class, on the way home, on a break from research, and pretty much whenever I got the chance. It never really occurred to me at the time that this could end up being a huge mistake. It was cool, I felt cool, and it was something that my parents definitely would not approve of. The Credit Card was often use to buy cigarettes at the grocery store. I distinctly remember when the price of cigarettes was jacked up in one swoop during college. All of sudden they were $2.50/pack! I thought of quitting, but didn't. Now, $2.50 sounds like nothing as I pay about $6.75/pack now. What a waste.

Moving on, junior year, I moved out of the dorms and into an apartment with friends. My parents thought that since they were paying for the dorm and meal plan and rent and groceries were cheaper that they'd pay for it as well. Looking back, I really was a spoiled brat and didn't appreciate how easy I had it. This makes me sad now, and I wish I could go back in time and kick my own ass. Junior year was also the time when I was introduced to my own credit cards for the first time. Again, the thought was, I'll have a "real job" later and can pay it all off in the future with no problem. I understand that this is a common thought for people, but it's oh so horribly wrong. Nevertheless, I dove head on into consumer debt. By junior year, I was getting regular lectures about the proper use of The Credit Card, and there were many fights between my mother and I on the subject. I was working on not using this card, and since I had several (yes, several) of my own, there wasn't too much of a problem. Quickly, my tiny credit limits were maxed out (~$500-1000 each over 3 or 4 cards), and I was stuck. So, I'd have to use The Credit Card again, which would lead to another lecture/fight. It really was a downward spiral.

And what, you might ask, did a 19/20 year old man-boy buy on credit? I don't even remember. Computer games, porn, clothes, alcohol, cigarettes. NOTHING that I still have now (with the exception of one porn magazine kept for sentimental reasons). That's the awful truth. I got in huge debt for really no good reason, except for the fact that I wanted things.

My senior year was a bit more of the same. I moved to a different apartment with different friends (my friends from the junior year place were no longer my friends after living with them for about 3 months). I kept spending and paying minimums. I started my VHS collection (DVDs were still years away). I had my part-time employment through my major department, which paid for some minimal spending money. My junior year, I got a second part-time job at a local government research lab, and this helped the money in-flow some. But at this point in things, I was already at the point where I was paying everything into the cards and then having to use the cards to buy things.

Unfortunately, I learned nothing about my personal finances during college. It's really only been in the last 6-7 years that I've learned my lesson, and even today, I'm still trying to dig myself out of the mess I created 15 years ago.

After graduation, I decided to move across the country and go to graduate school. My birthday just happened to be around graduation time, so as a combination birthday/graduation present, my parents bought me a car, paid for my move to California, and helped me get settled in my new place. This was all given to me with the explicit words that I was now "on my own". My brother was going to be starting college soon, and he was going to get the same treatment I did. This meant that there was no way they could pay for me. Being 22 years old, I was fine with that.

Now officially on my own, started the third part of my story: graduate school -- a story for another day.

Lessons Learned Part II: The caveat here is that I didn't learn these lessons during this time. It was only on dealing with the future that was created did I learn.

(1) Credit Cards are good, if you can manage them correctly. I thought this was the case and that I just wasn't doing it right.
(2) My parents were awesome, and I was very lucky. I don't think that I really learned this completely until tonight.
(3) Smoking is expensive, but manageable, because it's cool.

Next Up: Part III - Graduate School

Thursday, June 4, 2009

Some Goals for 2009

If you noticed over the past hour or so, I've been updating the Strudel Trackers with some actual numbers and goals. For 2009 the goals are all about debt of some form or another.

I have four sources of debt right now. Credit Card, Student Loan, CitiLoan, and my 2008 Taxes.

Basically, the student loan is inconsequential in the long run. It's a huge loan (more on this in the coming days), and my monthly payment is only $105.66. As long as I pay it each month... no problem.

Credit Cards: A topic to be discussed in more detail in future "History of My World" posts, since it is a prevailing theme in the horrors of my financial past. Currently, I'm down to only two credit cards only one of which I can actually use. The Mastercard is closed and being automatically paid every month. The CitiCard used to be that way until a while ago when my "good payment history" allowed them to open it again. As of January 2008 statements I owed a total of $10,394.74. WAY down from past highs (again, more later), but still high. Upon looking at what I typically pay each month, I've set the goal to pay a total of just under $4,400 in 2009 to get the total debt down to $6,000. After paying the June bills, my total balance is now $9,694.69. So, I've paid $700.05 so far in 2009, and for the first time in a long time, my total balance is down to four digits! Go me!

The CitiLoan: The reason behind this loan is ridiculous and worth of more discussion in future posts, but the short version is at the end of 2007, I took out a $7,500 personal loan from Citibank. At the end of 2008, I restructured the loan to get roughly another $1000 from Citibank. I can't find a current statement, so I don't know what the total balance is right now. But this loan seriously damaged my finances. So, a goal for 2009 is to pay this down. I hate that I had to take out this loan, but there were no other options at the time. My minimum monthly payment is $217.19, so the goal for 2009 is to keep that up and pay off roughly $2,700 of this loan. Since I've paid for six months, I'm half way there.

My 2008 Taxes: This is another horrible situation that I've found myself in. Okay that's putting myself in a passive position, which isn't the case. We'll talk a lot about the taxes and the horrors of being blessed with an NIH fellowship. But for now, just accept that I owe roughly $5,000 in taxes to both Federal and the state of Connecticut. The goal for 2009 is to pay my taxes, which for the most part is going to involve frugality and throwing every spare dollar and penny I get into my savings account in hopes of getting it all taken care of by the December 31 deadline. In the grand scheme of tax evasion, I'm small potatoes, but the idea of prison does not sound good to me at all. Basically, my savings account is what I paid into it on Sunday, so there's a long way to go on this one. The goal for 2009 is to get $6,000 to pay the taxes and start rebuilding the savings account for what it's actually for--saving money.

There's one more goal. It's not entirely financial, but it does involve money. I need to quit smoking (again). Another thread throughout my history, and there definitely will be more on this later. But smoking is gross, addictive, expensive, and can kill me, so it's got to go. I'm going to start this month, so I'm hoping to get this kicked over the summer. Part of this blog will be about that as well.

So, there you have it. My 2009 goals: pay down debt, quit smoking, and don't go to prison.

A Good Start (well, a start)

As a first run at getting this PF blog up and running, here's my thought. In my original thinking, I would have started this on May 31st to go over my bills and my routine, but I dawdled and hemmed and hawed. So, we'll just have to be content with doing this a week late. Sue me.

So, the best place to start this off is to present my routine. I've been working in academia for quite some time, which typically means a monthly paycheck instead of biweekly (which I understand is how "normal" usually get paid). When this started for me, it was a bit of a shock -- having access to a month's worth of money all at once was exciting, but it wasn't until I ran out of money mid-month a few times to get in the habit of getting myself under control. So, here's what I do.

I get paid on the last working day of the month. That evening, when I get home from work, I balance my "checkbook" (I use Quicken, so it's all electronic... no book.), and pay ALL my bills at the same time. This was the key for me that I learned a while back to avoiding overdrafts and late fees (for the most part). Now, all my bills are due between the 1st and the 15th or 16th of the month, so it's a bit easier. Used to be that some were due before I was paid, so those were always late. But more about the past later.

Moving on... Here's what happened last Bill Day:

Checking Balance: $3229.92
June 2009 Pay: $2906.30
Difference: $323.62

This difference is immediately transferred to my ING savings account, which (in theory) should earn me some interest. This also forces two things: (1) forces me to save money and (2) forces me to subsist for the month on only my paycheck. This I have learned is a good thing.

The next step is to pay all the bills and see what's left for the month:

Rent: $925.00
Gas: $41.02
Cable/Internet: $70.85
Electric: $64.16
Cell Phone: $51.17
Insurance: $75.16
CitiCard: $150.00
Mastercard: $131.00
Student Loan: $105.66
CitiLoan: $217.19
Netflix: $18.01
TiVo: $13.08

And that's it for monthly recurring bills. Mastercard, Netflix, and TiVo are automatically deducted from my account each month on a set date, so all I have to do is note it. Most bills I can pay online, which saves checks and stamps. Getting this nailed down took me several months. I keep an Excel file with all my bills listed out with URLs, usernames, and passwords, so each Bill Day, I simply have to go down the list clicking and paying. It only takes about 90 minutes to go through the whole routine, and it spends about 1/3 of my monthly pay. It's depressing, but really it's just one really painful day followed by 30-ish days of not having to worry about it. This really works for me.

History of My World - Part I

One of the things that I really wanted to do with my PF blog was to tell my story. I've had some high points and lots of low points. Mistakes were made. But instead of one really long post, I figured that I'd post in chunks. So, over the next few days, we'll get the history of my world.

Part I: Life in the DelMoniq House (Birth - Age 18)

This will likely be the shortest chunk of history (but cover the most time). Honestly, I don't remember too much about my childhood--good or bad. But we'll see what I can dredge up from the bowels of my brain.

Of course, being a child/teenager, I was under the direct financial influence of my parents and, for the most part, was completely supported by them financially. I'd definitely classify our family as middle-class. I'm not entirely sure what that means in "real people terms" but for me that means we weren't wealthy. We didn't live in a mansion and have servants, but my parents owned our home, and I have no memory of ever lacking any of life's necessities (food, shelter, clothes, etc.). I do remember being embarrassed, because the latent-hippie in my mother would make clothes for us when I was really young.

Ingrained in me from as early as I can remember was the fact that one had to earn his/her own way in life and should never expect things to be simply given to him/her. Well, when you're 10 years old, this is a HUGE bummer, because you don't get an allowance. No matter how hard I begged and presented case after case of friends at school that got allowances, I never got one. My brother and I were told that if we wanted/needed money for things we had to do chores. Different chores had different monetary values, and we could do things around the house to earn the money we needed to go to that movie with our friends, for example. This worked very well except for a few major flaws (most memorably from my high school years). My brother would frequently decide that he didn't really want the money enough to justify what ever chore was expected of him, and he opted not to do the chores. This typically lead to yelling, because for my parents it wasn't so much about teaching their two boys about financial responsibility as it was about them not wanting to do the chores themselves. So, after a while, my mother would talk me into doing whatever chores my brother was supposed to have done. The second major flaw was that my mother never seemed to have cash on hand for payment for said chores (never mind the fact that I was expected to do my brother's chores without compensation). She said that she was keeping a tally of things that I had done around the house and monies that I was owed. Very rarely did she ever pay up. **sigh**

This lead to the very awkward high school job hunt, for me. I remember applying to Burger King, and I actually got an interview. Of course, believing (as my father frequently told me) that the world revolved around me, my interview skills were quite lacking. Turns out that honesty is not always the best policy in job interviews, especially when you say that you want spending money and to get out of the house and away from the parents instead of saying that you really like Burger King burgers and want to be part of the fast food community or some other bullshit.

Eventually, though, I learned (some), and I landed a job at a department store at the mall. Ah yes, the naive, young Okturn folded clothes and such for hours on end, often helping clueless mothers pick out outfits for their teenaged sons that were "about your size". This job was great, because I did make some money and get some real world experience. This included the realization that seasonal help was NOT a long-term part time job and that creepy old men that work at department stores like to hit on younger guys by smacking their asses with hangers.

The downside of the high school job was that I was sucked in to the 25% employee discount (10% off at other stored owned by the same parent company). Nearly all of my pay went back into the coffers of the Dayton-Hudson corporation, and I got some really awesome early-90s fashions for my closet.

This also lead to my first taste of credit cards. Dut-duh-duuuuhh (dramatic music). But to get the full thrust of the credit card talk, we need to dial back a couple years.

Picture it... suburban Chicago, 1992. I'm offered a great opportunity as one of the honor students in the school district to travel Eastern Europe, recently after the fall of the Iron Curtain. It's a great opportunity, and my parents were all for it. Nine cities, six countries, 18 days, no parents. At 16 years old, this is an AWESOME thing (hell at 33 years old, I'd still kill to do this again). This trip introduced something into my life that would last for the next six or seven years -- The Credit Card. I use capital letters instead of just the credit card, because this was not just my introduction to credit cards as a financial concept. This was The Credit Card.

To explain... on top of the trip adviser recommended traverlers cheques, my parents decided that it would be a great idea to give me a Visa card. This card had my name on it, but it was not my own account. No. This card was linked to my mother's Chase account, and with her excellent credit The Credit Card had an unholy credit limit (I wouldn't learn the exact limit until years later, so you'll have to wait as well for that bit). The Credit Card was given basically for emergencies, but they trusted me.

In high school, The Credit Card was never a huge issue. I think, if I remember correctly, I gave The Credit Card back to my mother after the Europe trip. However, the spending habits of my parents that I watched and absorbed throughout the flourishing 1980s and early 90s really was a lesson that in retrospect should not have been learned.

I mentioned that they taught us that we needed to earn our way in life. However, my parents did not practice what they preached. I don't think that my parents over-spent themselves to financial ruin or anything that dramatic. But we always had the latest gadgets and electronics. My parents remodeled every house we ever lived in. And there were frequently new cars and such high ticket items being purchased. Hell, we had internet in our house in 1993! Not many of my friends at the time could say that. We had several computers when most people had none. So, really, instead of completely embracing the "earn your money" lesson, I rather learned that really, anyone could get whatever he/she wanted as long as he/she had a little piece of plastic and promised to pay for it later.

One non-financial lesson from my early years (that has direct bearing on my financial life now) was how to be self-sufficient, independent, and take care of myself. I guess that's three ways of saying the same thing, really. But seriously, by the time I was leaving home for college, I was cooking dinner for myself, if not the whole family, several nights per week. Doing my own laundry and caring for my younger brother on my own. Well, I had been de facto babysitter for my brother since I was 12. Some people that I've shared more personal details about my young life have said that this is a result of bad parenting or lazy parenting. I've even been told that my parents shouldn't have had children. I can't say that I completely disagree with that assessment, but my parents' parenting is not what this is about. The end result, and I'm glad this is how my life was (now), is that I'm a rather independent person for the most part. I may not like doing "grown-up" things, but I know what to do and how to get things done without relying on my parents. And that is definitely a good thing.

Lessons Learned in Part I:
(1) Earn your way in life; don't expect to be handed money/things.
(2) Credit cards are good (although the full thrust of this lesson had yet to hit home for me).
(3) Independence.
(4) My parents favored my brother over me (whether this is real or imagined is subject of debate, but this is from MY perspective).

Next up: Part II - The College Years

Wednesday, June 3, 2009

Welcome to Addicted to Toaster Strudel

Woo! My first blog post on my new blog. I'm on the cusp of falling asleep (after working the past few hours on customizing and setting up and tweaking the blog), so this is just a quick welcome message and promise to do my best to start the "real" blogging tomorrow.

On of my dearest friends friends writes her own personal finance blog, and a while back, she suggested that I join in and write about myself and my trials and tribulations with my personal finances. She suggested a couple of blogs to check out: Give Me Back My Five Bucks and The Simple Dollar. I spent some time considering this idea, talked it out with the cats, felt intimidated by other bloggers, and then ulitmately decided that I had something to contribute. Thus, tonight, "Addicted to Toaster Strudel" was born.

As with finances, it's good to have goals, and I'm going to start this off with what my goals are for this new venture of mine. This is going to be a way to hold myself accountable for my finances and to set and to monitor my financial goals. Also, I'll be posting my own personal history struggling with money and working on being able to live more comfortably and responsibly with my money. I'll do my best not to get sidetracked with non-finance related things and save those posts for my personal journal.

I hope that by narrating and sharing my own financial life that I'll be able to think more objectively and critically and my highs and lows and to keep track of myself and my money more effectively.

Also, please note, that I'm a scientist by trade, a writer by desire, and that I got a C in my college Econ class by shear force of will and a butt-ton of luck.

(Side Note: The Strudel Tracker bars to the right are by no means accurate right now, because I'm too tired to go to the other computer and look up some actual numbers. This should get fixed with a new post tomorrow evening.)