Chains of Servitude Update

It’s been almost exactly one year since I told my wife that we were either going to take control of our finances or file bankruptcy.

At that time, we were spending at least $500 more each month than we made, and often, it was $1000 more.   We had more than $5000 accumulated on our overdraft line of credit, more than $30,000 in credit card debt, $2500 on a student loan, $12,000 on a car note, and our mortgage.

Our savings were nonexistent.   We had automatic deposits established, but we’d transfer the money out right away to cover other expenses.    Everything that came up was an emergency and a surprise.  We had no real idea how much our lifestyles cost or what it actually took to maintain.

Maintaining our finances took several hours every payday to balance the checkbook and pay bills.

Fast forward 1 year.   The student loan is gone, the line of credit will be gone next month, and the car loan will be paid off before the end of the year.   We’ve reduced our total debt load by more than 20%.

We have a useful emergency fund and we’re meeting our other savings goals, including a college fund for the kids.    We don’t have extremely high balances, but it’s reassuring to have more than a couple of months of expenses in our savings accounts.

We’ve automated almost everything and gone to a cash-only system.   I now spend about 20 minutes a month balancing the checkbook and less than 5 minutes paying bills.

A year ago, we were in a hole, digging as fast as we could.   Now, we can see the end of the debt tunnel and we are rushing as fast as we can to get there.    According to my debt spreadsheet, we will be completely debt free in just under 4 years, ignoring any money coming from our side-hustles and work bonuses.

We’re making better progress than I had hoped for, and it keeps getting easier.    Smart spending is becoming a habit, instead of a just wishful thinking.

Update:  This post has been included in the Carnival of Debt Reduction.

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Selling on Craigslist

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The vast majority of personal finance websites(including this one) focus on reducing your bottom line–cutting costs.   The other end of the budget is at least as important. Have you tried raising your top line lately?   Have you picked up a side hustle, sold an article, put ads on a website, or even sold some of your stuff?  After we had our garage sale a few weeks ago, we were left with some furniture that was too nice to donate or discard, so we decided to sell it on Craigslist.

The key to selling your stuff on Craigslist is taking pictures.   They don’t have to be good pictures, just something to let your customers know what they are getting.  Take pictures, post the measurements and, if it’s electronic, the model number. Beyond that, a simple description will suffice.

Be safe when you are posting the listing.  Don’t give your address and don’t post when you will be home.   That’s just a job offer for burglars.   When you talk to a potential buyer, never tell them there is nobody home.  Tell them your roommate is the only one home and he doesn’t want to deal with the sale.   Don’t give strangers on the internet an opportunity to rob you.

When you are meeting a buyer, pick a public place away from home, if at all possible.   If you are selling furniture, it may not be possible, but it is for smaller items.   Meeting in a busy gas station parking lot or even in front of the police department is a good way to stay safe.   Secondary crime scenes are nasty things and inviting the wrong stranger in is offering one ready-made.

[caption id="" align="alignleft" width="196" caption=" "] [/caption]Bring a friend.  Preferably, an intimidating friend. Crime is less likely to happen if there is more than one person there.    Bring a friend to a public place to meet the buyer to maximize your safety.

Don’t get ripped off.   Craigslist scams abound. Bad checks, forged checks, and shipping scams are just some of the problems.

Only accept cash. It’s hard to forge a greenback.

One of the most common scams, after a bounced check, is the cashier’s check scam. You’ll get an email saying the item is great and payment is on the way.  When the check clears, a relative of the buyer will come to pick up the item.  Then, oops, their secretary made the check out for $3000, instead of $300.  Would you mind sending the overpayment back by Western Union, minus $100 for your troubles?   First sign of trouble:  over-complicating a simple transaction.   Second sign:  not using cash.   The cashier’s check will be forged.   There is no way to verify funds on a cashier’s check, and the bank will post it as available well before it comes back bad.   You will be able to spend the money, only to have the money disappear later. That means you can’t wait to see if the check clears before wiring back the overpayment.  There is no way to recover your money.

If you get a response that includes a link, do not click it!  Ever.  No matter what the link looks like.  Ever.  No clickyclicky. It may be an innocuous link to your ad, but the link can be masked.  Any other link is almost definitely a link to a virus-ridden website.  Repeat after me: No clickyclicky.

If you get an email about Craigslist transaction protection or escrow, you are being scammed. Run away.

Craigslist can be great way to turn your junk into cash, but only if you actually get the cash.  Keep yourself safe and scam-free.

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The Friday Tax

I’ve been at the doctor’s office every time my kids have been scheduled to get shots.   I let them know what to expect before the shot, hold their legs still during,  and comfort them after.   It’s not pleasant, but it is a bonding experience.  It builds trust. My kids know that if I tell them something won’t hurt, it won’t, because I tell them when it will.   Unpleasantness is never a surprise.    Somehow, this policy hasn’t led to a fear of the doctor.  They always know what to expect and how tough I’m expecting them to be, so they don’t worry.

Last Friday, it was time for the unpleasant duty. Both of the girls had checkups and one was due for shots.   I took the afternoon off to meet my wife and kids at the clinic.

It was a beautiful day.  It was warm, the sun was shining, and traffic was light.  The windows were down and music was playing; it was an almost perfect start to the weekend.

Did I mention I have a lead foot?

“No, honey, I don’t think we need to buy that” certainly loses some of it’s effect shortly after “Uh, honey?  I just paid the voluntary driving-too-fast tax.”

For days, I heard,  “Well, I wasn’t the one who got a speeding ticket!”   This sounds like nagging, but it’s not.   I am normally the one issuing reminders about spending and saving.   This time, it was her turn.   It’s not my job to hold her accountable.   It’s our job–jointly–to hold each other accountable.   If I mess up–and I did–she is perfectly within her rights to hold me feet to the fire. I certainly don’t hesitate when the roles are reversed.

I haven’t had a ticket in almost 12 years, so this isn’t a habitual problem.    It is an expense that should have been avoided.

Now, I’ve got to take a day off of work and go to court to try to keep it off of my record, so it won’t affect my insurance rates.   That means court costs on top of the fine.

Monetary weakness or a lapse in judgment can  derail goals.    We haven’t destroyed our budget for the month, but it’s not an insignificant amount of money.  I try figure enough padding into our budget that this isn’t painful, but it is money that could have been “snowflaked” onto our debt. It could have meant another $150 in the vacation fund.   That is disappointing.

It’s time to establish the habit of driving the speed limit.

Update:  This post has been included in the Money Hacks Carnival.

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Save Your Family

Grave

I don’t attach much importance to dreams.  They are just there to make sleepy-time less boring. Last night, I had a dream where I spent most of my time trying to prepare my wife to run our finances before telling my son that I wouldn’t be around to watch him grow up.    That’s an unpleasant thought to wake up with.  Lying there, trying to digest this dream, I started thinking about the transition from “I deal with the bills” to “I’m not there to deal with it”.   We aren’t prepared for that transition.   Last year, we started putting together our “In case of death” file, but that project fell short.    The highest priorities are done.   We have wills and health directives, but how would my wife pay the bills?  Everything is electronic.  Does she know how to log in to the bank’s billpay system?    Which bills are only in my name, and will go away if I die?   Is there a list of our life insurance policies?

I checked the incomplete file that contains this information.   It hasn’t been updated since September.  It’s time to get that finished.  Procrastinating is inappropriate and denial is futile.   Here’s a news flash: You are going to die. Hopefully, it won’t happen soon, but it will happen.  Is your family prepared for that?

The questions are  “What do I need?” and “What do I have?”

First and foremost, you need a will.  If you have children and do not have a will, take a moment–right now– to slap yourself.   A judge is not the best person to determine where your children should go if you die. The rest of it is minor, if you’re married.   Let your next-of-kin, your spouse keep it.  I don’t care.   Just take care of your kids! Set up a trust to pay for the care of your children.   Their new guardians will appreciate it.  How hard is it to set up?   I use Quicken Willmaker and have been very pleased.  Of course, the true test is in probate court, and I won’t be there for it.   If you are more comfortable getting an attorney, then do so. I’ve done it each way.    You can cut some costs by using Willmaker, then taking it to an attorney for review.

It’s a sad fact that often, before you die, you spend some time dying.  Do you have a health care directive?   Does your family know, in writing, if and when you want the plug pulled? Who gets to make that decision?   Have you set up a medical power of attorney, so someone can make medical decisions on your behalf if you aren’t able?  Do you want, and if so, do you have a Do-Not-Resuscitate order?  Willmaker will handle all of this, too.

What’s going to happen to your bank accounts?  I’m personally a fan of keeping both of our names on all of our accounts.   I share my life and my heart, I’d better be able to trust her with our money. If that’s not an option, for whatever reason, fill out the “Payable on Death” information for your accounts, establishing a beneficiary who can get access to your money if you die.   Do you want your spouse to lose the house or the car if you die? Should your kids have to miss meals?  Make sure necessary access to your money exists.

Does anybody know what you have for life insurance? Get a copy of the policy and make sure your spouse and someone else knows what company holds it and how much it is worth.

Now, it’s time to make some lists.   You need to gather account numbers and contact information for everything.

  • Bank accounts. List every bank and account you own.  Checking, savings, CDs.
  • Investment accounts. Again, every company, every account.
  • Mortgage and car payment information.
  • Life insurance. Get your policy numbers, contact information, beneficiaries, and amount of coverage all in one place.
  • Credit card accounts. Every card, every company.    If it’s just your name on the account, your spouse will need to send certified death certificates to stop collections.  Otherwise, she’ll need to pay the bills.
  • Utilities.  Get the account number for the electric bill, the gas bill, water/sewer/garbage, cable and phones.
  • Other bills. These include car/home insurance, Netflix, memberships and anything else you pay.
  • I’ve included the account information for my web host, registrars and websites. Some of it is salable, some of it is income-generating.
  • Car titles. Put the actual titles in the pile of lists.
  • Property deeds. Keep these here, too.

Non-financial information to list:

  • Online accounts. Any financial sites that would be useful, or any community sites you would like to have informed about your death.  Your online presence is a part of who you are.
  • Email accounts. Will your survivors need to interact with anybody potentially contacting you?   They will need your username and password, or most big providers won’t let them in.
  • Social media. How many networks do you participate in?  Do you want to disappear, or should all of your Facebook friends know your dead?
  • Blogs. Do you have a blog that needs an announcement?   Does it generate income?  Could it be sold?
  • Contact list. Who else needs to be informed of your demise?  Don’t make your loved ones hunt for the information.

Now, take all of this information and put it in a nice, fat envelope and lock it in the fireproof safe you have bolted to the floor.  Make a copy and give it to someone you trust absolutely.   Make sure someone knows the combination to the safe or where to find the key.

Your loved ones will appreciate it.

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