Prioritizing, Again

Like many of you, I always struggle to prioritize my saving/spending/debt repayment.  My husband has recently deployed, and I spent today figuring out the best way to use our money while he is gone.  It took me a while, but I think that I finally came up with a plan.

Here's how the thought process went:

I had five ideas for how to use our money.  I made a list with the pros and cons of each option.  (My list wasn't this fancy.  In fact, you probably wouldn't even have been able to read it.

 

Once I'd made this list, it was obvious that paying off my Home Equity Line of Credit wasn't a very high priority.  It has a low interest rate, it is tax deductible, I'm already making a huge payment every month, and I wouldn't be able to pay it all off.  So I scratched it off the list.

Then I looked at paying off the credit card debt faster.  I'm already on track to pay it off before the end of the deployment and it is at a low interest rate.  I decided that paying it off faster than currently planned wasn't a very high priority.

That left me with TSP, emergency funds, and the Savings Deposit Program.  The SDP is pretty amazing - you can't find 10% annual interest anywhere else right now.  I decided that we should try to put as much money as possible into the SDP.  If we somehow manage to max out the SDP (deposits are capped at $10,000, which is a lot of money,) then I think that we should try to put as much as possible into TSP.

Right now, my big question is:  do I take our emergency money out of our emergency fund and put it into the SDP?  It is earning very little interest right now and the 10% would really add to that money.  I can't imagine any upcoming emergencies, but that's why they are emergencies - you can't predict them.  Maybe I'll keep a little bit out and put the rest in SDP.

Working this all out has taken a good chunk of my day, but I think that I've made a good decision.  Any thoughts?

TGIF Discounts

TGIF, the chain restaurant with the bright red and white stripes, has a couple of deals going on right now.  First, they've put together a new "frequent diner" club called Give Me More Stripes.  If you sign up for the club online, you get a free appetizer coupon.  The link is located here.  The club itself offers the benefit of $8 in free food for every $100 spent.  It would take me several years to spend $100 at Fridays, but if you are already going there anyway, it makes sense to join.  I'll probably join just for the free appetizer.

Also, Fridays has issued an unusual, unlimited use Buy One Entree, Get One Free coupon.  The instructions say to share it with your friends, and it can be used an unlimited number of times until March 1st.

Lastly, if you are in Fridays today, you can enter their Over/Under game for the "big game" tomorrow.  (It seems they are pretending that they can't call it by its proper name.)  You have the chance to win either a free cheesecake or a free slush, depending on if you properly guess whether the total score of the game will be over or under 44 points.

While I'm not a big fan of eating out regularly, there are occasions that make restaurants a good or fun choice.  If you're going to go out, you might as well do it as frugally as possible!

photo by:  bingbing

Quotable: Author Unknown

"Car sickness is the feeling you get when the monthly payment is due."

Free Ziglar for Active Duty

Ever heard of Zig Ziglar?  Mr. Ziglar is an author and speaker who focuses on personal growth, leadership, sales, faith, family and success.  He has been speaking and writing since the 1970's, and has built a successful business that includes a long list of speakers, 27 books that have been published in multiple languages, and accolades from everyone from politicians to small business leaders to academics to churches.

Mr. Ziglar's namesake company, Ziglar, is offered a free subscription to the Ziglar Vault, an online library of Ziglar's best audio and video programs.  The Vault contains over 100 hours of material.  The regular price for this access is $14.95 per month.

While I couldn't take advantage of this offer because it is only for active duty members, it appears that the programs can be downloaded to your MP3 player.  In addition, the Vault claims to have exclusive content not available elsewhere.

If you enjoy listening to motivational and educational content, this is a great opportunity for you to access Ziglar's acclaimed products for free.  If any of you try it out, I would love to hear what you think.

5 Affordable Moving Announcements

Moving gets expensive.  I don't think I need to explain that much.  You need to tell your family and friends your new address, but you don't need to spend a fortune to do it. 

1. Over at Northern Cheapskate, guest poster Susan writes about her experience making her own change of address cards (with a little help from Office Max).  I had no idea that it could be so easy!
2. You can use a free month at Blue Mountain to send out eCards with your new address on it.  There are other companies that also offer free eCards for change of address.  Google "free change of address eCard" for a full list.
3. Use VistaPrint to print affordable postcards or business sized cards with your new address.  That's what I did last time and they were cute, affordable, and fast!  I got a lot of compliments on my cards.  The only downside is that the minimum order was way more than I needed, and I've still got change of address cards from two years ago hanging around my desk.  (I should probably recycle those now.)
4. Enlist your kids to create a sketch of your new place, then include it in a newsy Christmas-style letter.  This is especially good if you missed getting out cards last holiday season.
5. Call people!  If you are in the US, and you unlimited long distance, take a half hour each day to call people and tell them your new address.  This has a multitude of benefits:  it's free, it gives you a chance to catch up with your friends, and you can tell them to write it down "right now!"

I'd love to hear if my readers have any other creative ideas.  I know that we can keep in touch without spending a lot.  So share, okay?

photo by:  RBerteig

Get 6 FREE Valentine's Day Cards

Hurry - this offer ends February 1st!

ScrapbooksEtc, a website that is affiliated with Better Homes & Gardens, is offering 6 free personalized Valentines' Day cards.  The offer is for 6 of the same cards from their selection.  You do have to register with their website to use this offer, and the entire process took me about 20 minutes as there is some uploading involved.  I wouldn't recommend this just to get some free Valentine's day cards, but if you are looking for a cute card to send to a group of people (I'm thinking Dad, grandparents, and aunts & uncles, or maybe a book club, or similar) then this would be a fun and free project for you.

I Won The Lottery! Well, No...

When I'm on a long driving trip, I always look for lottery billboards and spice up my drive imagining what I would do if I won 276 million dollars in the Powerball.  I imagine a house on the water, someone to clean my house, and taking my extended family on relaxing vacations.  I don't imagine quitting work, a huge house, or fancy cars.

What does this have to do with real personal finance, you ask?  A lot.

If you imagine what you would do with a huge lottery windfall, and you are thoughtful about it, it will tell you a lot about your personal priorities and desires.  You can use that information no matter how much money you have, to make sure that you are making good decision with your money and using your money on things that have  value for you.

What do I mean?  Well, let's look at my dreams.  I dream of a house on the water, a cleaning person, and vacations with my family.  I might not be able to accomplish all those things on my current income, but I can look at my spending to see if I'm making the best financial choices to support those priorities.  Can I keep on driving my car for several more years to spend that money on a week at the beach with my family?  Long term, do I want to move somewhere less expensive so that I can live on the water?  And do I really want to pay someone to clean my house, or do I need to get rid of some stuff so that I don't have so much to keep clean?

Dreaming of a big win helps me prioritize my wants.  Knowing my true wants is the first step to making those dreams come true.  I may not have won the lottery, but I've learned a lot about myself in the process.  It's an interesting exercise and you might want to try it.

photo by:  wellohorld

Fresh Salad Every Day...Yum!

I love salad!  What I don't love is making salad every day.  I buy the ingredients, but then I don't make the salad.  As I've said before, dinner time is not the best time at my house.  That is exactly why I'm so glad to read Jeremy's article at Generation X Finance, How to Prepare a Salad to Last All Week for Just a Few Dollars.  I already have a salad spinner (check your base thrift store, I've seen them there a lot) and I can manage the rest of the directions without too much trouble.

Now for salad dressing.  It is easy enough to buy bottled dressing, and it isn't too expensive, but I prefer the fresh stuff.  Here's a link to my favorite ranch dressing recipe at AllRecipes.com.  It has no preservatives and it is just as yummy with low-fat ingredients.  Add some blue cheese if you like that flavor.  Here are some other good dressing recipes to try:  a list at Cooks Recipes, Nikibone.com's Salad Dressing Recipes, and Salad Dressing Recipes.

With a couple of heads of lettuce and extra ingredients, you should easily be able to make a weeks worth of salads for only a couple of dollars.  Tasty and affordable - I love it!

Photo by:  oldstretch

Pre-Deployment Spending Spree

It has been a couple of years since my husband deployed, and he's not going on a ship this time.  We've spent the last couple of months buying stuff for him to take - a laptop computer, a super-duper backpack, new boots, a camera - the list is pretty long.  And we've been doing things that we wouldn't usually do - eating at our favorite one-a-year restaurants, taking the family bowling, stuff like that.

And right now, we're sitting in a hotel room in Norfolk, figuring out how to reorganize now that his departure has been delayed.  Another night in the hotel, another day of family fun.  I'm thankful for the extra time together and I'm also thankful that our budget can support these surprise expenses.  There have certainly been times in my life that an extra night in a hotel would have been unaffordable.

This military life has many financial benefits, such as well-priced medical care, housing or a housing allowance, and the consistancy of pay twice a month.  On the other hand, it seems like we have more unusual expenses than anyone I know - quarantining pets in foreign places, 17 different types of uniforms, and buying new curtains every couple of years.

This pre-deployment spending spree has reminded me why it is important to keep our finances in order and plan for the unexpected.  Our extra time together would be significantly less fun if I were worried that the cost was going to make it hard to pay our bills this month.  One more reason to keep paying off debt and building up our savings.  You never know what our next adventure is going to be, and I want to be prepared.

Round-up!

There's so much good stuff to read on the internet!  Here's what I've particularly enjoyed this week:

Frugal Dad talks about how Frugal People Focus Too Much On The Outgo.  I find myself struggling with this a lot.  Is it smart to spend an hour clipping and organizing coupons if I've lost an hour of income?  That depends.   What if I could use that hour to mow the lawn instead?  Or prepare a healthy, inexpensive dinner?

If you are looking for budgeting and debt help, and you are a spiritual or religious person, faith-based financial guidance might work well for you.  LaRita Heet writes about basing debt management and financial counseling on specific religious foundations.  If you are looking for financial help, this type of program might work for you.

Most couples have some differences in spending styles, and sometimes those differences can be big and problematic.  Chicago Business writes about how the economic challenges are strenghtening the position of the savers.  Are you a saver or a spender, or is your behavior changing?

Do you prefer using a debit card so you don't go into debt?  Have you ever wondered how your protection differs when you use a credit card or a debit card?  Mighty Bargain Hunter tracks down some answers in Some More Visa Debit Card Questions and Answers.  This is a follow-up to an older post, Visa Debit Card Questions and Answers.  I learned a lot from these posts!

Are you thinking about getting any sort of loan?  Mortgage?  Car?  Personal?  Jeremy at Generation X Finance reminds us to Read the Fine Print Before Signing Any Loan.  He makes excellent points about particular items that should cause you to take notice.  I recommend for asking for any loan documents ahead of time - it is no fun sitting at a loan closing and reading each and every page of a bjillion page document, while the real estate agent and title closers sit tapping their fingers.

I hope that you are having a great 2009 so far, and that the cold weather across much of our country hasn't been too rough!

5 Reasons Not Saving Money is Saving Me Money

Since the new year began, I've been trying to better prioritize and simplify my life.  Do I need to take advantage of every CVS deal out there?  Does it really help my family if I disrupt everyone to go use a $3 coupon that is expiring?  Is the pay of a small freelance job worth the impact on my family?  In these last couple weeks, I have discovered the most interesting thing.  I'm saving a lot by not trying to pinch every last penny.

How is that, you ask?  I'm not exactly sure yet, but I'm gradually starting to figure it out.  Eliminating small errands and jobs that takes me out of the house means that I'm home more.  And that saves me money.  Here's how:

photo by:  dawnzy58

1. Spending more time at home means that we have decent meals, planned ahead and prepared from actual ingredients.  It is hard to be tempted by the golden arches when there is a lovely roast in the crock pot at home.  In addition, I'm eating leftovers for lunch and snacks because I'm right near the fridge when lunch and snack time come around.  I'm also a lot better about using the stuff in my pantry and fridge if I'm not near a store every day.
2. My car gas bill has dropped dramatically.  I've never used a lot of gas, but now I'm filling up every two weeks instead of once a week.  I'll save at least $50 a month.  In addition, I'm putting a lot less wear and tear on my car, and my maintenance costs should be lower.
3. We easily have time to go to the library regularly.  My kids are delighted to have new reading material on a regular basis!  Not only am I eliminating the cost of occasionally buying a book, we can also borrow DVDs and audio books.  My goal is to eliminate movie rentals, including the ones from the store and the On Demand movies.  Don't forget all the other benefits of using the library.
4. I've discovered that we do not need more clothes.  My washing machine has been running a couple of times a day and I am nearly caught up with all the laundry.  My kids can barely close their dresser drawers!  The problem wasn't too few clothes, it was too few clean clothes.  It is hard to keep up with the laundry if you are never home, especially if you are cautious like me and don't let the washer or dryer run when you're not home.  Not only do I not need to buy any more clothes, I think that maybe we need to clear out some of the things that they don't love and wear.  We'll be able to bless someone else with our unneeded clothing and maybe even get a tax deduction, too.  On the subject of clothes, I am wearing more of my older, comfortable clothes instead of my nicer clothes.  I'm sure that they will last a lot longer if I'm not wearing them everyday.
5. I've eliminated a lot of shopping.  If I run into Target because my favorite T shirts are on sale, I'm likely to come out with a dozen things.  And I find it hard to pass up really good deals on things that we'll need "someday."  Less time in stores = less money spent, at least for me.

The biggest benefit of staying home doesn't save any money at all - I feel so much less stress when I'm not running around all day, I get my chores done, and I have time to take care of my home and family the way I want.  Peacefulness plus money saving:  I think I like this.

Click here to go to The Paycheck Chronicles main page.

Frugal Tips to Make Your Dollar Stretch

Sometimes, you're just looking for a few good tips to save a couple of dollars here and there.  And over at BeingFrugal.net, the authors have compiled a list of 168 quick tips from around the web.  Check it out, pick a couple that look like it will work for you, and maybe save a little.

Quotable: Charles Dickens

From David Copperfield:  "Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery."

Pay Attention to Your Credit Card Accounts. Especially Now!

I've been reading bits about new credit card policies and fees, but I haven't paid much attention.  This article by Lynn Truong at Wise Bread really got me fired up, though.  It seems that the random credit fees and costs are getting really out of hand.

Read the comments, then check your cards to make sure that you aren't being hit by any of these inappropriate fees.  I've not had any problems with my Navy Federal and Pentagon Federal cards.  I've heard complaints that USAA is raising their interest rates, and I received a notice that it is going up to 7.75%, but it hasn't happened yet.  And I don't think that 7.75% is bad if all the rest of the cards terms are good.

It looks like we're all going to have to be very proactive in keeping an eye on credit accounts.

Photo by:  Logan Antill

Military.com's Coverage of the GI Bill

One of the most frequently asked questions at Military.com is how the new GI Bill is working.  I could go into long descriptions here, but it is thoroughly explained elsewhere at Military.com.  So, I'm compiling a list of links that should answer most questions about the GI Bill.

The main GI Bill page is located here.  The "new" GI Bill, also called the Post 9/11 GI Bill, is scheduled to go  into effect August 1, 2009.  You can also look for information applying to Guard and Reserves.

If you were hoping to go to a private college and take advantage of the Yellow Ribbon program, you might find this article interesting:  Fiscal Crisis Threatens GI Bill Program.

Comprehensive and up-to-date coverage can be found at the Military.com's Military Education Blog.

photo by:  gadgetdude

50 Way to Save on Travel

As I've said before, we military folks tend to spend a lot of time traveling.  Whether we're PCSing, going to visit family, or just taking a proper vacation, any time spent outside of your own home is going to be more expensive than staying home.

David at Money Ning offers 50 Ways to Budget Travel and Save Money on Vacations.  I found several useful tips that I'd never considered, like checking the local website instead of the international one.  I also appreciate all the suggestions that apply to internation travel.  I've not done a lot of it, but I am hoping to!

I'm sure that you all have picked up a few travel tips along the way.  I'd love it if you could share your best ones!

FREE Tax Filing at MilitaryOneSource

At last, the free tax stuff at MilitaryOneSource is available.  OneSource is offering free tax preparation software, free efiling, and telephone and email consultations about your specific situations.  These services are available to active duty, National Guard and reserve members and their families.

The tax preparation software is H&R Block's TaxCut Basic.  You must be a registered user of MilitaryOneSource and login to your account before you may click through to the H&R Block program.

MilitaryOneSource has compiled a comprehensive FAQ page that should answer any questions that you have about this program.

In addition, Military.com member S Kang pointed me to the IRS schedule for distributing direct deposit and paper check refunds.  I didn't even know that there was a schedule...I always figured that they did it on a first come, first serve basis.  Here's the link to the IRS website.  Thanks, S Kang!

I guess it is time to start working on these taxes, huh?

photo by:  Paul Keleher

10 Financial Commandments for Your 20s

It's funny.  I think of Kiplinger as a money magazine for old people (like me, I guess.)  However, they've recently put together a really good list of 10 Financial Commandments for Your 20s.  It's pretty comprehensive and lays out the steps that a younger person can take to help make future finances a lot easier.  In addition, it has lots of relevant links to explain each commandment, which really helps if you're not sure what they're talking about!

I feel pretty lucky that my husband and I were able to built a solid financial foundation during our 20s.  We didn't do everything right, but we did make some good decisions along the way.  This Kiplinger list will help  20-something readers to make those good choices and prepare themselves for a successful financial future.

How A Credit Card Payment Is Processed

Here's a simple and visual way to understand how credit card payments are processed.  After years in money related employment, I thought I knew the process, but I learned a bit from this as well.  Click here to go to CreditCards.com and see the show!

Photo by:  The Consumerist

Come to the Carnival

In the blog world, there are these things called Carnivals, where a particular blog author selects a group of their favorite posts from around the blogoverse.  It is similar to my Round-up yesterday.  Anyway, The Paycheck Chronicles post on Space Heaters was selected to be included in the Carnival at Penelope Pince's Pecuniarities.   All of the entries are excellent.  I encourage you to click on over and check them out.  I imagine you'll find a lot that you like - I sure did!

Your First Place? Ten Tips

What's more exciting than moving out of the barracks, off the ship, or out of your parents house?  It is fun and overwhelming at the same time.  Here are 10 things that will make it easier, faster, and more enjoyable.

photo by:  Menage a Moi

1. Check your credit report before you start looking.  Clean up any errors and make sure that it presents a good picture for a potential landlord.
2. Figure out how much you can afford.  Experts recommend that you not spend more than 1/4 to 1/3 of your total income on housing expenses.  In the military, it is a little more complex, but that is still a good starting point.  Another way to look at it is to make sure that you are spending less than your housing allowance, when you include the rent, utilities and renter's insurance.  Take your total take-home pay and subtract all your expenses:  savings, car payment, insurance, food, clothing, cell phone bill, credit card payments, entertainment, and uniforms.  Add a bit for unexpected expenses and plan to stay under the amount you have left.  Preferably pretty far under!
3. Plan for deposits:  Not only will your new home require a security deposit and your first month's rent (and often the last month as well), but you may also need to supply a deposit for your telephone service, gas and electric bill, and cable bill.  Security deposits are usually one month's rent, and utility deposits can run from $25 to $250.
4. Make a list of all the things you will need to buy, and estimate the costs.  You'll need a bed, sheets and blankets, towels and a shower curtain, dishes, glasses and pots and pans.  You'll probably want some furniture and a TV.  The costs of putting together an apartment can be overwhelming - make sure that you are prepared.  You can save a lot by doing most of your shopping at thrift stores. 
   Resist the urge to make your place look like the apartment on a TV show - you probably aren't going to live there long enough to justify such expenses!
5. Make a list of needs and wants.  Consider cost, location, size, parking accommodations, safety, washer & dryer, pool, exercise room, and pet questions.
6. Use a variety of resources to find good possibilities.  Ask your friends and coworkers if they have recommendations.  Look in the newspaper and freebie real estate books.  Contact a real estate company to see what they have to offer.  Use the internet for other options.
7. Check out your prospective neighborhood several times - at night, in the morning, and on the weekends.  Drive from the new place to work during rush hour.  Talk to people who already live nearby...they often know a lot of stuff that the landlord won't tell you (and might not even know about.)  Look to make sure that the parking lots are well lit and that no strange people are hanging around.  See if security doors are closed or if residents are propping them open.
8. Make sure you see the actual apartment or house that you will be living in, not just a model.  Check it out thoroughly - try the sinks, flush the toilets,  and open and close the closet doors.  Sniff around and listen carefully.  Look for evidence of bugs or rodents.  Make sure that it is a place that you want to live!
9. Read your lease carefully, and think about it for a couple of days before you sign the lease.  Make sure that everything that you've discussed with the landlord is spelled out in the lease:  pets, pest control, noise, late fees, visitors, parking, etc.  Most installations legal or housing offices have lease review services.  Check to make sure that you understand everything in the lease, and that it clearly states who pays for what utilities.
10. Get renter's insurance!  Once you've moved in, you will need to protect your stuff from loss.  Renter's insurance is very inexpensive and well worth the money.  Your auto insurance agent probably offers renter's insurance as well.

I feel like my list sounds like a list of reasons why you shouldn't get your own place.  That's not what I'm trying to say at all!  If you plan ahead and stay smart, you can get the right place for you and your budget.  Enjoy!

Round-up!

Some of the best posts from around the internet this week:

Prime Time Money writes about getting Hard Core Frugal.  Enough stories about cutting back on expensive dinners out and having bargain vacations - here are the places to look when you really have to cut back.  Plus there's a hilarious link to a SNL skit about spending.

My kids and I were just talking about how there's a day/week/month for everything.  Well, I had never heard of National Thrift Week until now.  Single Guy Money has an excellent history and future of Bring Back Thrift Week.  With American's new focus on spending less, this seems like it would be a very popular idea.

Over at Lifehacker, a post that strikes a real chord with me:  What's Your Sweet Spot Between Money Saving and Time Wasting?  I struggle with this issue daily.  I see from the comments that I'm not alone, and the commenters bring up even more factors to consider.  Very interesting stuff.

My Two Dollars publishes the M-Network's answer to a reader's question:  Should We Buy A New Or Used Car In This Economy?  With the enticing offers that car manufacturers are coming up with, this is a timely question and the variety of answers really helps to look at all sides of the issue.

The Razor's Edge:  Lessons in True Wealth is a thought-provoking article by JD at Get Rich Slowly.  Talking about his friend, Sparky, JD considers the lessons he has learned from Sparky's lifestyle.  As I look around my house overflowing with stuff, I wonder what opportunities I'm missing because of the choices I make.

Check out these great articles and enjoy the holiday tomorrow!

CNBC's On The Money Offers Free Workbooks

Have you seen CNBC's personal finance program, On The Money?  The host, Carmen Wong Ulrich, offers sounds advice and interesting stories that will help you make the most of your paycheck.  To go along with the show, On The Money is offering four downloadable workbooks.  Topics include building wealth, family finances, borrowing and retirement.

The workbooks are short and the downloads are quick.  I didn't print out the whole books because I didn't see that I was going to get long term value out of every page.  I did the quizzes on scrap paper and only printed the pages that I felt were most useful.

In addition to the downloads, the On The Money website offers a variety of other resources.  I hope you find it helpful.

Operation Purple Family Retreats

The National Military Family Association (NMFA) is piloting a new program this year.  An offshoot of their popular Operation Purple Camps, Operation Purple Family Retreats are designed for families whose service member has returned from deployment within the last twelve months.  From the website: 

It is difficult on the entire family when a loved one is deployed, but the time after that father, mother, husband, or wife returns  home is often the most challenging of all. Recognizing this, the National Military Family Association is piloting two Operation Purple® Family Retreats. These free, four-day retreats are set in a National Park using nature’s classroom, where families will have opportunities to strengthen and renew relationships, explore their natural surroundings, and participate in fun family-focused activities.

If you have a recently returned family member, and you live anywhere near these locations (one is in California and one is in Washington State), you might want to see if these would work for your family.  What a wonderful opportunity to enjoy a little affordable R&R and get some quality family time.  Thanks, NMFA!

photo by:  mateoutah

Quotable: Benjamin Franklin

"Remember that credit is money."

Five Reasons NOT to Pay Debt With Your Emergency Fund

My emergency fund is calling me.  It wants to be used.

As I scanned our bank accounts today, made a few transfers, and updated my progress on my 2009 financial goal, I started getting itchy.  There is a decent amount of money in my emergency fund.  We worked hard to save that money, and it seems like it should be doing something other than sitting in the bank.  Doing nothing.  I could transfer that money to my debt and make a substantial dent in the amount we currently owe.

So why not?

1. This is not an emergency.  It is easy to start thinking that a debt is an emergency, but if you have had this debt for a while and you incurred it on things that weren't emergencies, the debt itself isn't an emergency.  I have a solid plan to pay off this debt within the next 10 months, and I'm on track to do it. 
2. There isn't a lot of money in this emergency fund.  As I said before, it is a decent amount...enough to pay the deductible if we're in a car accident, enough to pay for a new hot water heater if ours blows up, enough to pay for a couple of plane tickets if we unexpectedly have to fly to a family emergency.  If I had thousands of extra dollars, then maybe I should pay off my debt with it.  But that's not the case here.
3. The emergency fund gives me options.  If we move and need to buy a washer and dryer, we don't have to put it on a credit card.  If a child gets sick and I need to scale back my work for a while, I can.  If the Navy forgets to pay my husband, we'll still eat.
4. Our tax bills can be difficult to predict.  I am self-employed and my income varies dramatically.  Deployments and TDY can lower your taxable income.  The one time we DITY moved, we ended up with a tax liability for that (did you know that counts as income?)  After years of getting back huge refunds, we have change our withholding so that we come as close as possible to getting the right amount withheld.  However, with all the variables in our life, I always hold my breath as we do our taxes.  This might be the year that we owe, and what if it is a lot?
5. Having a well-stocked emergency fund gives me peace.  There are so many stressors in life, and I like the comfort that comes from having a small stash of money.

I admit, I can easily think of 5 reasons why I SHOULD put my emergency money towards debt.  However, I'm pretty sure that the 5 reasons listed above are more important.  Paying off my debt isn't a sprinting race, it is more like a long, uphill hike.  If I stick to the slow and steady course, I'll eventually reach my goal and I'll still have my emergency fund for, well, emergencies.

Do You Have a Debt Problem? A Quiz

MilitaryOneSource offers a variety of self-assessments, including Do You Have Debt Problems?  The assessment has 15 questions and is estimated to take 5 minutes, though I think it may have taken me less than one minute.  It isn't particularly elaborate, but it is interesting and definitely worth a few minutes of your time. 

I do have some questions about the results.  I only answered one question in a way that could be construed as negative, and the quiz told me "Your score indicates that you may benefit from learning more about managing your budget and dealing with debt."  Seriously?  Because I once consolidated all my bills onto a home equity loan (when we were doing work on the house)? 

I don't know what type of answers the quiz will give people who answer differently, but there is certainly value in the questions themselves.  If you answer them honestly, you will problem know instinctively whether your answers are indicative of a problem or not.  If you disagree with the quiz' assessment of your situation, then use your own smarts to see if the answers indicate a problem or not.  As with any tool, it's accuracy is dependent on individual situations.

Despite my questions about the scoring, I still think it is worth your time.

Photo by:  tj scenes

Free SAT-ACT Prep Software

                       I had heard about this before, but a tip from Love My Tanker at SpouseBUZZ reminded me:  Free SAT and ACT test preparation software is available to military members and their families.  This program is offered by a group of NFL football players and the company, eKnowledge.  The Standard ACT and SAT programs are offered for free, and the Premium programs are offered at a substantial discount.  Also, all the extra programs, including LSAT review, are offered at half price.  The customer will pay the shipping and handling, which is pretty expensive:  $14 for each ACT or SAT program ordered.

If you are in the market for ACT or SAT preparation software, this might be a great deal for you.

A more complete explanation of the offer is available at MilitaryHOMEFRONT.

photo by: Menlo School

Free Suave Haircare Product

Suave Haircare products is offering a free bottle of product, today only.  Click here to see the link.  Here's what the website says:

"For over 70 years, the Suave brand has bottled our belief that you can live beautifully for less. It's a belief we call Suavenomics. We want to put a bottle of that in your hands. We hope it will inspire you to apply this idea to your everyday life. Clip a Coupon. Hit a shoe sale. Squeeze more joy out of every dollar. This is no time to give up on your hopes, your dreams, or your beauty. This is time to stop overpaying for them."

Hey, who am I to pass up free shampoo?

Space Heater or Turn Up the Thermostat?

I'm home alone most days, and I try to keep the heat in my drafty house down to about 62 degrees during the days.  I don't want to let it get any colder because it would be hard to warm up when the kids got home from school, and because I would be really, really cold.  I have a small electric space heater that I keep under my desk because that is the place where I'm usually the coldest.  So I got to wondering - is that really efficient?  How much electricity is my space heater using?  Is this the best choice for my situation?

Here's what I found out:

photo by:  Jo Jakeman

First, I hadn't considered how many types of space heaters were available.  Spaces can be heated with natural gas, propane, kerosene, electric or wood heaters.  Electric heaters are the most popular because they are easily obtained, portable and easy to operate.  However, they are the most expensive form of space heating so consider whether a more permanent solution is better for your specific situation.  I'm going to focus on electric space heaters because that's what I have, and that is the easiest choice for most people.

How do you choose an electric space heater?

• What kind of heating do you desire?  Are you looking to heat a small space (like under my desk) or a whole room?  Do you want to use it constantly or intermittantly?
• Do you want a model with a thermostat, or will you manually turn it off and on as necessary?
• Do you have small children or curious pets?

Safety is an important issue when purchasing a space heater.  The US Consumer Product Safety Commission estimates that more than 25,000 residential fires are caused each year by space heaters, resulting in 300 deaths.  An additional 6,000 emergency room visits result from space heater burn injuries every year.  Here are some space heater safety consideration:

• Make sure that is has the UL (Underwriter's Laboratory) certification label.
• Look for safety features such as overheating shut-off and a tip-over safety switch that will turn off the unit if it is tipped over.
• Plug directly into an electric outlet, or use a heavy duty extension cord.  Do not use a standard extension cord.
• Do not run the cord under carpets.
• Keep the area free of all objects.
• Place on a hard, flat surface, preferably the floor.

There are several types of space heaters, but specifically there are radiant heaters and convection heaters, which may or may not include a fan to assist with the convection.

• Radiant heaters work by emitting infrared radiation that directly warms up anything in it's "view."  Radiant heaters look hot, and they are.  Radiant heaters are more of a fire hazard and burn danger than other types of heaters.  They typically use less electricity and provide for more instant heat.  Radiant heaters have a metal or quartz element that is heated, and use reflectors to send the heat to a specific location.
• Oil-filled radiators.  They use the normal air flow of a room to spread the heat that they make.  They take longer to warm a room, but they provide a lot of heat and they are quiet.  Good for heating a cold room all the time.
• Ceramic Fan blown heaters use fans to spread the warm air.  These don't get as hot to the touch as radiant heaters or oil-filled radiators.
• Heater Fan use a fan that blows air over a heated coil.  They provide fast, even heat over a larger area.  In addition, usually the heater portion can be turned off and the fan can be used alone in warmer weather.

So where does all this information leave me?  My ceramic space heater uses 1500 watts and costs me about 18 cents an hour to use, at 12 cents per kWh.  I probably use it about 8 hours a day, which makes it $1.44 a day.  My gas bill, which covers heat, hot water and cooking, runs about $3.50 a day when it is really cold outside.  So what makes more sense?  I don't know how much I would have to turn up the heat to make my desk area warm, and I'm not sure that I want to find out.  What are my options?  (Besides freezing, of course.)

The Missouri Department of Natural Resources website probably summarizes it the best:

"If you turn your central heating system down a few degrees and supplement the heat in a small area with a space heater, you will probably save money.  If you do not turn the thermostat down and add more heat with the electric space heater, you will increase your total bill."

I wonder if I could turn my heat down another two degrees and use the space heater?  Or put on another layer of clothes?  I think I'll try both and see how it goes.  I'll let you know!

Another resource:  The US Department of Energy's Consumer's Guide to Portable Heaters"

Interesting Stuff from the Bureau of Labor Statistics

The Bureau of Labor Statistics website is a treasure chest of info for geeky types like me.  If you click on the consumers link on the left hand side, you can then click through to find average spending for various groups broken down by income level, family size, and age group.  I find this fascinating from a purely educational point of view.  I don't think that this report means that I need to run out and spend $376 on tobacco and smoking supplies, but it is interesting to see where our spending is near to or far from the national averages.

Another thing that is useful about reading these BLS charts is that it shows you how the federal government breaks down budget categories.  I've often wondered how to budget things:  do I want to put all insurance in one category, or does auto insurance go under transportation and homeowner's insurance go under housing?  You can do whichever works for you, but it is good to think about these things.

Maybe you will find it interesting, too.

Getting Through Tough Times

I ran across an useful, if rather dry, website by the University of Illinois.  It offers very basic information about dealing with the toughest of economic times - when you've lost a job or suffered another large economic hardship.  There are subsections on managing your finances, controlling spending, helping families cope, and smart saving and spending.  You might find something useful!

What's the Difference? Egg Sizes

I was at the commissary yesterday, and they were out of the eggs that I usually buy.  I started checking out the other options, and decided that I'm easily confused by egg sizes.  How do I know what the difference in sizes means?  Which is the better value?  I came home, did some research, and here's what I've found:

Photo by:  woodleywonderworks'

• There are six sizes available:  Jumbo, Extra Large, Large, Medium, Small and Peewee.  Eggs are sized by their weight per dozen. 

EGG SIZE	Oz. Per Dozen
Jumbo	30
Extra Large	27
Large	24
Medium	21
Small	18
Peewee	15

• Most eggs sold in the grocery stores are Extra Large, Large or Medium, with Mediums being less common.
• Any size egg can be used for scrambling, frying, poaching or hard-boiling.
• Most recipes are calibrated for large eggs.  You may substitute between sizes as long as the egg isn't a crucial ingredient in a delicate baked good, such as a souffle.  Extra large eggs may be substituted 1-for-1 with large eggs until you reach six large eggs, at which point you would use only five extra large eggs.
• For a $1.00 dozen of large eggs, the equivalent price of extra large eggs would be $1.12.  If you are looking to purchase the most economical, use that as a guide to check out which prices are better.  In the eggs I buy, the extra large eggs are only 10 cents more per pound, which makes them a better value.  (And I'm buying expensive eggs.)

Well, now I know that it isn't complicated at all.  I'll continue to buy the extra larges as long as they are the most economical, and I won't worry if I have to buy large or medium.  As long as I'm not making something that is very fragile or contains a lot of eggs, the difference in size shouldn't change the results of my recipes.

And now I know!

Know Your Thermostat

With cold weather in most of the country and heating bills rising quickly, this is a great time to learn more about how to efficiently heat and cool your home.  I found this interesting site at Madison Gas & Electric that explains more about how much money can be saved by turning down your thermostat.

I know that this is hard for me...my house is old and drafty, I work from home, and I don't like to be cold.  I use a space heater under my desk (I'm working on a long post about space heaters), have a heavy quilt over the sliding glass door next to my desk, and try to dress warmly.  We all agree that it is no fun to be cold, but it is no fun to be broke either!

I've challenged myself to lower our gas & electric bill from its astronomically high level on the December bill.  Want to join the challenge?

From the Mailbag: What To Do With an Upside Down Car Loan

I recently received this email:

How do we go about downsizing our vehicle that we are upside down in?  We are about $8,000 over our head with this vehicle and want to get something more affordable, but basically are stuck with it.  Simply giving it back is not an option due to the negative credit hit that we would take.  We have tried selling it ourselves, but since the gas fiasco within the last year no one wants to buy a full size SUV (we are a fmaily of 5, two of which are teens).  We have tried to trade it in but the dealers won't give us anything near what we need for it.  We have brought our price down several thousand dollars below what we owe just to get rid of it.  Any ideas for us?  Does anyone else have any constructive comments or suggestions?

 Here's what I think:

Photo by:  Editor B

No doubt about it, you are stuck in a hard place.    Owing more on a car than it is worth is a rough situation, and that situation is even worse right now because new cars are selling for less money, and dealers & manufacturers are offering amazing deals to entice people to buy new cars.  This is driving the price of used cars down as the demand falls.

Consider your reasons for getting rid of the car.  Do you want to get rid of it because of the car payment, the insurance, or the amount of gas that it uses?  Another big factor is whether you will need to purchase another vehicle to replace the one you're getting rid of.  (That is the situation about which I will talk because that is the most common.)

Most often, people want to switch to a smaller car because the car payment is too high.  Unfortunately, the best way to get out from under an upside down loan is to keep the car and continue making the payments.  If you are at all able to make the payments, tighten the belt in other areas and keep chipping away at that debt.  Eventually you will reach the break-even point and be able to sell the vehicle for near the same amount that you owe.  Even though it seems like you should be able to solve your problem by selling the car, even for less than you owe, it usually doesn't make sense mathematically.  You'll either need to come up with cash to pay off the loan when you sell the car, or you'll have to take out a personal loan for the difference.  If you have the cash on hand, you can use that to buy the loan down to a point where you can sell it today.  If you need to take out another loan, then you aren't reducing your debt at all.

If the car payment is absolutely killing your budget, look into refinancing for a longer term.  I wouldn't recommend this if you have any other options.  Refinancing for a longer term will keep you upside down longer.  Before you start shopping for a new loan, check to make sure that the existing loan doesn't have a prepayment penalty.

Many dealers are willing to roll over your negative equity into the loan for a new car, but there are several reasons this is a bad idea.  First, you'll be even further upside down as soon as you drive the new car off the lot.  Second, you will nearly always be getting a higher interest rate.  Third, in order to be able to afford all this debt, you'll be paying for the new car for a lloonngg time.

Another idea that I have heard suggested is putting your car up for sale, but rather than asking for a dollar amount, ask for the buyer to take over your payments.  I can't imagine why anyone would want to buy a car that is upside down, but it might be worth a try.

If you do decide to keep the car, consider whether it would be financially smart for you to try to get "gap" coverage.  In the event of a loss, this insurance pays for the entire amount owed on a car regardless of the amount owed.  While gap coverage is usually purchased at the time that you purchase the car, some insurers will allow you to add gap coverage at any time during the loan.  This will protect you from having to come up with thousands of dollars if the car is totaled in an accident.  If you are in a tight financial situation and are having trouble paying for your car, gap protection will keep you from financial disaster in case your car is completely wrecked in an accident.

The sad fact is that there isn't a quick or painless solution to getting out from underneath an upside down car loan.  With some determination, you can hopefully rid yourself of this burden and get into something more affordable for your family.

Thanks for your letter, and good luck!

Suze Orman's New Book: Free

Suze Orman has just published a new book, Suze Orman's 2009 Action Plan.  Amazingly, it is being offered for free, via download, until January 15th.  Click on this link to go to Oprah's website, which is presenting the offer.  Make sure to read the downloading direction so you do it correctly the first time (unlike me!)

This timely book deals with many of the urgent financial issues that American families are dealing with right now.  It is called an action plan for a good reason:  it lists specific actions that you can take to improve your ability to weather this economic storm.

Quotable: Doug Larson

"What some people mistake for the high cost of living is really the cost of living high."

2009 TSP Info

The Federal Retirement Thrift Investment Board recently announced the 2009 limits for TSP Contributions, loan interest rates, and other up-to-date TSP info at this site.  The elective deferral limit for 2009 is $16,500.  Elective deferrals are the tax-deferred amounts that you choose to contribute to the plan instead of receiving as pay.  In addition, members serving in designed tax-free combat zones can contribute up to a total of $49,000 in 2009.  Wow - that is a lot of money.  However, there are big  benefits to contributing heavily to your TSP while deployed.  The money won't ever be taxed, because it has been earned in a tax free zone.  As long as you contribute some portion of your base pay, then you can contribute up to 100% of any special pays.  The explanation sounds a little complicated, but basically any money you contribute to your TSP account while you are deployed doesn't fall under the $16,500 limit because you aren't deferring any taxes.  The $49,000 figure represents another IRS rule that limits total contributions to TSP, not just the ones that are deferring taxes.  (I apologize if I sound redundant - it took me a while to figure it out).

If you are eligible for a civilian TSP account because you are a reservist who works for the federal government, or you leave the military during the year and then begin working for the federal government, there are some special rules that apply to your contributions.  Some info about these situations can be found here,

There is a good TSP question and answer page located here.  In addition, the TSP Board offers a variety of publications that explain nearly every possible TSP situation.

Deep Disney Discounts

Walt Disney World in Florida has recently announced a new military discount promotion, called "Armed Forces Salute."  In this offer, each active duty or retired service member will receive a FREE five day ticket that includes the Park Hopper and Water Park Fun & More options.  In addition, the service member may purchase up to five "Armed Forces Salute Companion" 5 day tickets for only $99 each.  The companion tickets do not include the Park Hopper or Water Park options.  Those options may be added for $25 each.

For families whose service member is not able to join them (like us!), the spouse may purchase the five companion passes without the service member present.

In addition, Disney is offering a 40% discount on select hotel rooms.  Both these offers are scheduled to end on December 23, 2009.

I hope that many of your are able to take advantage of these very affordable prices at Disney!

Photo by:  Joe Shlabotnik

Free CD or Download: Taking Charge of Your Money

Those helpful people at MilitaryOneSource have a available (for free) a great CD or download called Taking Charge of Your Money.  It is 66 minutes long and has 10 sections.  You can order it to be mailed to you in CD format, or you can download it to your computer or MP3 player.

Photo by:  DeclanTM

2009 Tuition Assistance Info

Elsewhere on Military.com, you can find a brief overview of the Armed Forces Tuition Assistance program, as well as links to the individual services websites.  The reimbursement limit for 2009 has been set at $4500.  While I know how hard it is to work and go to college at the same time, this benefit is awesome!

(There seems to be a typo in the chart today - in the the Amount Covered column, Air Force row, there are two sets of figures.  I'm nearly positive that the second set is obsolete, and I'll update this post when/if there are any changes.)