This Phone Bill Can't Be Right

I am a satisfied customer of AT&T. I don't have a "fancy phone" with internet access and whatnot (at least for now :>). I have a plan with just enough minutes (I have plenty that have "rolled over") and unlimited text messages. The base price for my rate plan is $59.99 ($39.99 for the minutes and $20 for unlimited text messages). I've gotten accustomed to paying just under $70 a month for my phone bill (including taxes, fees, and the occasional usage charge for when I accidentally access the internet<<those data charges suck!) However, I've noticed that my most recent bills have been $71+. 

At first, I thought I was accidentally accessing the internet more often than usual. Turns out, one of the miscellaneous fees has increased. Now you might say, "what the heck is your problem? It's just a couple of dollars." Well, I believe it "all adds up." Besides, I'm irritated that my monthly spending plans reflect a $70 expense for something that turns out to be a little bit more. At the current rate (approx. $71/month), I'm spending $12 to $24 more (per year) on my phone than planned!

Okay, so maybe I'm being a bit dramatic. You know what I did? I changed my billing address to my parents home (heck, I have their address on file for other accounts, so what's the big deal?). My hope is that the local fees for their city/county/state will be lower than the local fees for my city/county/state. I'm crossing my fingers I can go back to paying $69.82/month (or less). I'll keep you posted!

Would you change your billing address on an account if it meant paying lower taxes and/or fees? Why or why not?

P.S. I recently signed up for auto-pay on this account. I guess it took me so long because I have a thing with control and desire to move money when I want to. ..and this auto-pay plan doesn't allow you to set the payment date. Most importantly, I wanted to make sure that I'd have the funds available to cover the expense, as I assign certain expenses to the 1st or 2nd pay period of the month. However, I've been bought... there was a $10 incentive to switch to auto-pay or paperless billing (I did this eons ago). So I'm just waiting on my ten bucks! I'll probably ask you what to spend it on ;)

Lesson Learned

In my last post, I was gearing up for part two of my vacation to the Bahamas [to help my girlfriend celebrate her birthday]. Sadly, I didn't go. I left my passport [1: The Passport Story]. Shipping that sucker overnight would've been stupid expensive, not to mention the expense related to changing my flight reservation. To make matters worse, several hours after returning from the airport, I got sick. I don't know if it was something I ate or my distress over missing my girlfriend's birthday manifesting itself, but I was out of commission for 2.5 days. Fortunately, I've recovered, and my vacation is behind me :( 

Although I missed out being a Bahama Mama this past weekend and creating adventure-filled memories, I've managed to find a [financial] bright spot in the midst of it all. The money set aside for the trip went unspent. And once you consider that I was bed-ridden and in no mood to do any online shopping, that money has remained unspent. Previously, I mentioned the temptation to go above and beyond those funds, but considering all of the circumstances, it's safe to say that that's not an issue. 

Here is my question to you: what do I do with the unspent vacation funds?

So far this is what I've come up with: buy a gift for my girlfriend (had I attended the festivities, I would've footed the bill for something- dinner, drinks, souvenir, excursion, etc.), put the money back into savings, use it for another trip (I'll be in a winter wonderland of snowboarding this upcoming weekend), put it towards my car payment, or buy something nice for myself.  

What would YOU do with previously set aside funds that go unspent?

[1] The Passport Story: August 2008, my girlfriend (the same one whose birthday I missed :<) and I drove 8+ hours to Toronto. As we approached the US-Canada border, my friend asked me a very important question: "do you have your passport?" If you guessed my answer being "no", you guessed right. Despite a verbal reminder to pack that sucker, I left it behind and was faced with the possibility of turning around (no fun, if you've ever driven on New York's I-90 [the exits are 15 trillion miles apart from one another...I'm only exaggerating a little bit]). Luckily, we were allowed to pass through without issue. Perhaps I took that lesson for granted; this most recent incident hurt a lot (i.e. not being able to go). Undoubtedly, I consider this a major lesson learned!

Vacation Spending

I've been looking for a little inspiration for today's post. I've been on vacation for the past several days, so my routine of writing and posting has been thrown off (sorry about that!) But in the midst of my relaxation, I've uncovered the motivation to share today :)

I had been planning this vacation since October/November 2010. In addition to intently reading Trip Advisor reviews and making reservations, planning has included setting aside money for lodging, food, excursions, and even a few souvenirs. Part one of my vacation has ended, and I've gone over budget by $100 because I failed to include transportation in the expenses; otherwise, I would've been right on target. As I think about part two of my vacation, I wonder how realistic my budget will be. Just as I had done with the first part of my trip, I failed to include transportation costs. I am also left to wonder if I will have the benefit of shopping at a local grocer to make purchases that will help with the food portion of the budget (sandwiches and granola bars for lunch, anyone?) 

Fortunately, I have some cushion in my checking account to cover any expenses that go above my budget for the upcoming part of my trip. I should mention that part of this "cushion" will be spent for food and gas when I return to work next week. Luckily, I have a 4-day work week, a tank full of gas, and a plan to pack lunch [everyday next week]; in other words, I won't sweat part two of the vacation too much. I'll keep you posted =)

Early Graduation from Graduated Payments?

In Tuesday's post, I shared my negative net worth statement with you. It forced me to log on to the Direct Loan Servicing website to see the exact amount I owed (up until then, I referred to it as "$30,000+"). Well, it's $30,504.41 (down from the original $32,300). And that's not the only thing I noticed. For the past two years, I've been paying $229.21 a month for my student loans as part of the graduated repayment plan. This amount fit into my $35,000 yearly gross income at the time I began repayment (exactly 6 months after completing grad school...wow, I just had a moment....$35K income AFTER graduate school....:<).

Anywho, the graduated repayment plan allows debtors to pay off their loans in the same amount of time as standard repayment debtors (130 months). Rather than paying the same amount month after month (like the standard repayment plan), the graduated repayment plan allows you to pay a smaller amount for two years, then the amount increases for the next two years, then it increases again for two years, and so on. In fact, here's what my graduated repayment plan looks like:

You'll notice that I'm scheduled to pay an additional $36.76/month beginning February 2011 ($265.97-$229.21 = $36.76).  I've anticipated increasing my student loan payments....once my car note has been paid. Fortunately, the February '11 increase is feasible (by the way, the few bucks extra in my paycheck because of the tax holiday covers the $36.76 and then some). What I've started to think about, however, is if I should hurry into the standard repayment plan (that is, once my car note is paid off). By the way, here's the standard repayment schedule:

I'm thinking that I will "free up" more money to save and invest with the graduated repayment versus the standard repayment. The graduated plan costs $1163.54 more in interest; a "drop in the bucket," relatively speaking, but who wants to throw away money? Then again, my money wouldn't be tied up in a 5.3% loan and I could do more (i.e. earn more) by contributing to my Roth IRA, $10,000 goal and brokerage account.

What would YOU do?

A New Tradition?

Two of my favorite bloggers, Debt Ninja and J. Money, share monthly net worth updates with their readers. Since I'm down for being a copycat (disclaimer: so long as it's the right cat to copy ;>), I've decided to do the same at the beginning of the month. Here goes:

Here's a summary explanation:

Assets

403(b): $100 every pay check.

Emergency Savings: Currently, I'm not contributing to this account. However, I've tapped it a few times in 2010 to pay for major car repairs.

Regular Brokerage Account and Roth IRA: I'm not contributing to these accounts, at the moment. However, I made a random deposit (from my "emergency savings") to beef up the Roth a bit. In hindsight, it was totally a psychological band-aid for the realization that I haven't been maxing it out.

Savings Account: $25 month. I opened this account for overdraft protection, but I haven't had to use it for such in the past year. Yet, I sometimes transfer a few bucks to cover an unanticipated, small expense (like the crap I got around Thanksgiving 2010).

Liabilities

Car Loan: If you've read through my previous posts, you know that I'm a bit obsessed with paying off my car note sooner than later. I opened this account in July/August of 2009 with a $13,500 balance. If I paid what my credit union wants me to pay on a regular basis, I would retire this debt in 2014. However, I have other plans. I set aside $1,055/month to pay off this sucker. With my estimations of a nice tax refund and "extra" paycheck in April, I plan to completely eliminate this debt by May 2011.

Credit Card: Despite setting aside cold-hard-cash for holiday gifts, I still resorted to my credit card to make some purchases. Gas. Food. Clothes. Accessories. And they were all for me. Now I'm staring this junk in the face, wondering how I'm gonna pay it off (one of my goals this year is to avoid incurring interest charges) while staying on track to pay my car note off by May. I'll keep you posted (even though I suspect the funds will come from January's $1,055 car note money :/).

Student Loan: Six years of post secondary school for me = $30,000+ student loans. Currently, I am on a graduated repayment plan (which will adjust in February to a higher amount). I have no intentions of continuing to pay on this plan, as, ultimately, the total interest charges exceed those of the standard repayment amount (i.e. about eleven years of the same payment each month). As soon as financially possible (hopefully May of this year), I can begin paying the standard repayment amount ($360.10) and then some (you know, so I can knock this puppy outta the water!).

I'll also share my yearly net worth updates once per quarter. Heck, I might later change my mind and display the YTD net worth totals with the monthly ones. But seeing as this is my first stab at it for the year, I figured I could spare you the redundancy.

Do you check your net worth? How often do you calculate it? Monthly? Quarterly? Bi-Annually? Yearly? Never? What benefits do you glean from assessing the differences between your assets and liabilities?

One More Day of 2010

Image from: www.geeks.pirillo.com

Lately, I've been reflecting on this year and the past decade (technically, the past eleven years, but I digress). It never ceases to amaze me how quickly time "flies by." My sister warned me that "after 21, it's all a blur." Blur or no blur, I'd like to review some of my accomplishments and a few things I am looking forward to in the new year.

 

What I'm Proud of... 

• Procuring a higher-paying position with an organization I admire and a wonderful group of colleagues. 
• Making massive additional payments to eliminate my car loan debt.
• Reining in credit card spending and managing the account so that I have a small balance (i.e. less than 30% of my credit line) or zero balance.
• Sharing my financial experiences with the world [wide web].

What I'm Looking Forward to...

• Increasing my savings and investing amounts (including maxing out IRA and getting on track to save $10,000).
• Increasing my net income.
• Finally eliminating my car note...and increasing my principal payments to my student loan debt.
• Consistently paying my credit card balance in full.
• Expanding my knowledge about insurance, taxes and investing.

What was YOUR biggest financial accomplishment of 2010?

P.S. HAPPY NEW YEAR!!! Have fun and be safe!

Hooray for Tax Cut Holidays!!!

2011 is right around the corner and with it, our paychecks will have a little something extra. As part of the deal extending the Bush-era tax cuts, a number of employees will receive a 2% reduction in payroll taxes. As of now, this reduction is temporary (it will last only a year). What does this mean for me and likely for you? Mo' money! $40 'extra' per paycheck in my case. I used a nifty calculator at Kiplinger's website to confirm my own calculations.

Naturally, the first thing I did was update my 2011 spending plan to reflect this anticipated increase (too soon?). Then I started thinking about what I would do with an extra $80 a month. It isn't much, but it kinda is (with the price of gasoline going up, I think these few bucks will definitely come in handy!). At any rate, I'd like to plan how I would spend it. Here are my ideas:

• Add to my car payments
• Use for travel (particularly airfare to see the beau; I haven't budgeted for this for the first quarter of 2011 and I need to purchase airfare for February and March).
• Add to my savings (I did say I want to save $10,000 in 12 months, didn't I?)
• Add to my Roth (I also said I wanted to max out the ol' IRA...)
• Go shopping...a little

The last idea is inspired by my long-held desire to dress more stylishly. Undoubtedly, this is also what is expected of us, as this tax cut is labeled a sort of "stimulus package."

What are your plans for the few bucks additional to your 2011 paychecks?

Financial Goals for 2011

In my most recent post, I shared that I'd been organizing my finances (reconciling savings plans, debt reduction plans and budgets). Naturally, the next thing for me to do was to think about what my goals are for the upcoming year and what I need to do to make sure these goals are achieved. Below, you will find my goals and the steps I intend to take to make them a reality:

• Zero credit card balance: My goal is to end every credit card billing cycle without a balance. This is one way to ensure that I don't spend above my income. I can make regular purchases, such as gasoline and groceries, with my credit card. In fact, I've been considering a rewards card to earn points for ___________ (<<that means I don't know, yet >). This year, I paid $68.21 in interest charges.  That's enough money for gas (and then some), a nice dinner with my boyfriend, an outfit, or a small contribution to my savings plan (after all, it all adds up!).
• Max out my Roth IRA: You already know that I've been kind of obsessed about paying off my car note. As such, I don't have much money left over to max out my IRA. With a projected payoff date of April 28, 2011, I have May 2011 through April 15, 2012 to contribute $5,000 to my individual retirement account. What do I have to do to make this happen? Contribute $454.55 each month to the account. With two "extra" paychecks in 2011, I may have the flexibility to reduce the monthly amount, but this requires that I'm diligent about redirecting a sufficient amount of those checks to the IRA. Knowing me, I'd like to set a few bucks aside for fun =)
• Pay off my car note: Originally, I planned to pay off my car note by June 2012, that is, until I ran the numbers on my beau's proposition of significantly increasing the principal payment amount. Currently, I am on track to achieve this goal by the end of April 2011, especially if my assumptions about my anticipated tax refund are correct. If they are less than I estimate, I may have to postpone the due date for this goal (which, undoubtedly will effect the savings goals). Let's keep our fingers crossed and hope I am at least right :)
• Generate at least $250/ month in extra revenue: Before I took the job that I currently hold, I had a steady goal of generating $3,000 in net income each month. With my deductions for my defined contribution plan, I am short of this goal by $222 each month. For the past few years, I've been toying around with a business idea that promotes personal finance. My goal for next year is to get serious about a web design and marketing plan so I can realize some income. $250/month of income to be exact. To be clear, I'm not looking to pocket all income; undoubtedly, I will reinvest into the business, but having the income will definitely provide some peace of mind.
• Accumlate $10,000 in non-retirement savings accounts by 05/31/2012: These funds would be available for immediate access and as part of my emergency savings. Why $10,000? Frankly, it's an arbitrary amount, but it's definitely a "stretch goal." There are a number of factors at play. Let's start with the not so good possibilities: what if I don't pay off my car by the end of April? What if I don't generate enough additional income? Well, my $10K goal within 12 months will be postponed (by the way, I'd redirect my "car payment" money to this goal). For me to achieve this goal, I need to set aside $833.34/month.  

If you recall, I have $1255 available as discretionary money each month. I'm comfortable spending $200 of this amount for fun stuff. So $1055 - $454.55 (Roth)-$833.34($10K goal)= $-232.89. A girl MUST increase her income to make these goals come true. Even if I sacrificed fun stuff every month (i.e. the previously mentioned $200/month), I'd still be a few bucks short! 

At any rate, these are my financial goals for 2011. What are your financial goals for 2011, if any? How do you intend to achieve them?

Budgets, Holiday Stuff and Revisiting Financial Goals

...and I'm back! I sincerely apologize for being absent last week, but I'm back now =)

So, what's been going on? The usual, the not-so-usual and some more of the usual. Let's get started with the usual.

The Usual

I've been diligently tracking my expenses in my tracker housed on Google Docs. I've exceeded my allocated amount for food and car expenses: footing the bill for my sister's birthday dinner; being a bit impulsive (eating out, mostly); increasing gas prices (is anyone else paying around $3/gallon?); and regular car maintenance (the coupon for my oil change this time around wasn't $19.99 + tax :<).

The Unusual

Holiday stuff. You know, buying gifts and bringing in whatever you signed up for for the holiday party at work. Actually, the work stuff was easy. We had a cookie swap and I brought a non-cookie item to swap: brownies. Had I not been distracted by the massive amounts of sugar tempting my waistline, I would've repackaged the cookies and sold them for income =) The not so easy stuff is holiday shopping. To cover the expense of Christmas gifts without regretting it in January (i.e. financing all purchases with my credit card with no clear way of paying it off), I decided to decrease the amount of my car payment this month to $356.98 (I know, it's a weird amount). At any rate, doing so allowed me to spend $705 of "car payment" money on gifts for my parents, sisters, boyfriend, best friend and godson. Sadly, I've spent $690 and some change and I still have a few items to pick up. Fortunately, I have a few bucks in my "immediate access" savings account (this is NOT my emergency savings account) that I'm comfortable using to cover these items.

More of the Usual

Revisiting goals and planning. I spent quite a bit of time today updating my savings plan [another Google spreadsheet I use to track the balances of my savings account linked to my checking account (see "immediate  access" savings account above), my ING Direct account (emergency savings), my Roth IRA, regular brokerage account and 403(b)] and reconciling it with my 2011 budget. It feels SO DARN GOOD to account for every single penny. Did you get that? EVERY. SINGLE. PENNY. I know where it came from or where it went and for what purpose. Moments like these help me feel in control of my finances, and not vice versa...something that I occasionally freak out about. Nevertheless, I am on track to enjoy my boyfriend's birthday (I've planned a surprise trip for him), my girlfriend's birthday (we're going to be "Bahama Mamas"), a winter weekend getaway in the Poconos with a gaggle of friends, my 2nd year anniversary with the beau, paying off my car note, and my friend's wedding. And all of these things are happening in the first half of the year! To be fair, I am making assumptions about my anticipated tax refund, the bulk of which will go towards principal reduction on the note. Everything else is accounted for (i.e. planned to come from my regular income).

As I prepare for 2011 (and the end of my car note, hooray!), I'm considering the opportunities to save more, invest more, and to be better equipped to pay for travel and entertainment expenses that inevitably have a habit of "popping up." My post later this week will focus on financial goals [and concomitant action plans] for 2011.

How have you been handling expenses related to the holiday season? Did you set up a budget? Are you "winging it?" Have you started to plan for 2011 financially? Have/will you do a "2010 Year in Review" for your finances?