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10 Tips to Help Parents Stay Out of Debt

Finance, Parenting

Cobbler shaker (right), jigger, and a bar spoon.
Image via Wikipedia

People say that when you have a baby, your world gets flipped upside down.    That’s not true.  Your world gets dropped in a martini shaker and left to the whims of a sadistic bartender with a shaking fetish.  Everything changes.    That sounds like an exaggeration and nobody believes it until it happens, but it’s true.

When you find out you are about to reproduce, you will experience a phenomenon called “nesting”.   Nesting is the idea that, if you take your credit cards and beat them against the curb until they bleed and VISA calls you asking for mercy, you will be transformed into the best parent ever, regardless of what you may actually screw up.   It’s the way parents calm their fears by spending money, often on things that aren’t needed.

Q.  How do you avoid becoming a debt-ridden, worried mess of an over-protective, over-extended new parent?

A. What do you get when you cross an elephant and a rhinoceros?

I can’t help with the rest, but here’s 10 ways you can avoid the debt problems.

  1. Have a budget.   I may have said this before.   It’s possible this counts as a recurring theme here.  If you don’t have a budget, you aren’t in control of your money.  If you aren’t in control, then how do you know where it has gone or where it is supposed to go?
  2. Budget for baby crap.    This will be a recurring expense for years, so get used to it.   A friend of mine is on the cusp of having everyone out of diapers for the first time since 1993.   Do you think they plan that expense?  Diapers.com has $10 off and free shipping on orders over $49.  Use code “ LiveReal” during checkout.
  3. Double the number you have in #2.  Seriously.  It will cost you more than you think, but it doesn’t have to cost you as much as you fear.  It’s far better to have too much budgeted and find yourself with extra money than it is to budget too little and be forced to make up the difference at the feet of Master Card.
  4. Only take the advice of people you know and trust. Every random jerkface on the street has (usually) well-intentioned advice for new and expecting parents.   Ignore them all.  If they aren’t your doctor, your mother(assuming she did her job right), or friends with children, they are clueless and their advice should be immediately round-filed.   Ditto for parenting magazines.   The writers don’t know better than you do.   Read the magazines for six months and watch for conflicting advice, not only in the same magazine, but often from the same writer!   Don’t add the stress of bad advice from strangers to what is already a stressful time.
  5. Don’t get every gadget designed to cushion the baby. A wipe warmer is a waste of money.   Do you want your baby to be scared of a little chill forever?  Cold wipes build character.    If that isn’t good enough, hold the wipe in your hand for a few seconds before using it.   There are a million other gadgets to keep your little one from ever feeling a moment of discomfort.   Don’t waste your cash.  It may only be 10 pounds, but it’s tougher than you think.
  6. Don’t get every gadget designed to cushion the parent. They make ergonomic bottles, braces to hold your arms in the right position to feed, fancy cloths to catch baby vomit.   Tough it up. Support your baby yourself.  Build some muscle and some character.   Use cloth diapers to catch various treasures your little brat will spit up on you.   Spending more doesn’t always make it better.  The ergonomic bottles that make it easier to feed a baby, make it harder for the baby to hold the bottle.   This is actually making your life more difficult.
  7. Focus on the necessities. Yes, the fancy formula with the pre-digested proteins has a nicer label.   It doesn’t make a difference.    The generic brand at the warehouse store usually has the exact same ingredients in the exact same ratios as the brand name at the baby store–for half the price.   There is nothing special about the blankets in the baby section–except the price.    The fancy bottle warmer doesn’t do anything that a cup of warm water on the counter won’t handle.   You need:  A crib, unless you are doing a family bed; a easy-to-clean mat to change diapers(on the floor works!); and a diaper bag(back-to-school backpacks are more ergonomic and easy to organize than anything in the baby store!).  Everything else is a luxury.
  8. Time counts more than stuff. No matter what else you hear, no matter how old your child gets, time with you counts more than anything else you could do or buy.   Be there for your kids and the rest is gravy.
  9. Brand-name and designer labels are not status symbols. The opinions of the other soccer mommies do not matter.   The opinions of the random jerkfaces on the street do not matter.   Designer labels do not make you a better parent and are not an indicator of a happy baby.
  10. Always remember:  Babies bounce and have short memories. While I don’t recommend bouncing your baby on the floor, they are surprisingly resilient.   They don’t hold grudges, either.   There is room to make mistakes without screwing up your kid.

For a hundred thousand years, people raised babies with nothing more than a scrap of hide to alternately chew on or wipe with.  You can probably get buy with just a bit more.   Relax and enjoy the process of raising your kids.   Money doesn’t matter nearly as much as your presence.

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Money Hacks Carnival #105: The All Government, All the Time Edition

Misc

Jefferson Memorial
Carnival Time

Welcome to the 105th edition of the Money Hacks Carnival:  The All Government, All the Time Edition. Deep in the bowels of tax season, it’s not surprising that tax- and government-related articles are popular.

Editor’s Picks

LeanLifeCoach presents What Is Your Learning Style? This is an important lesson for anyone trying to teach.  My main side hustle involves teaching.  We try to address each learning style to engage all of our students.  I’m a visual learner.  In school, I always read ahead and I’ve never been able to focus while someone reads to me.

Consumer Boomer presents The Best IRA for You.  Holy Educational Post, Batman!  Be careful, you’ll learn something if you read this post.

PT presents How to Find Free Stuff Online Without Getting Spammed.  I like free things.   I hate spam.  I’m a part of the target audience of this post.  I use an active Gmail account for getting freebies.  The spam filter can’t be beat.

Fanny Seto presents 5 Tips on How to Get a Job in this Economy.  I’m glad I haven’t had to deal with this recently.   If you’re unemployed, take the opportunity to develop a hobby or explore other opportunities.  You may be out of work, but that means you have the one thing you can’t replace: time.  Use it wisely.

Taxes or Feeding the Monster

Jeff Rose presents How to File Taxes with Your 1099s.  All you’ve ever wanted to know (and more!) about the 1099.

Paul Williams presents Deduct Haiti Earthquake Relief Donations on Your 2009 Tax Return.  If you itemize, make sure you include any donations to Haiti relief.

freefrombroke presents TurboTax Online 2009 Overview.  I love TurboTax.  I use it every year and have done so since I discovered I wasn’t capable of figuring out the Earned Income Credit.

Four Pillars presents What Happens If You Lose Your W2 Form?.  Keeping track of your tax documents is always important, but what do you do if that doesn’t work?

Matthew Paulson presents Troublesome Tax Myths.   Taxes aren’t optional.  Ask Wesley Snipes.

Working for a Living or Earning the Monster’s Feed

Darwin presents 10 Highest Paying Degrees 2010 – Best Majors in Demand Now.  The part that doesn’t surprise me is that the hard sciences pay well.   Art-as-science comes with a smaller paycheck.   Hmm….

J. Money presents Life in Grad School Doesn’t Have to Suck…All Your Money.  I’ve didn’t make it to grad school, but I did work my way through college with a small baby.  It’s good to have a support network.

The Financial Blogger presents Getting Ready for Another Purchase!.  I’ve never given any thought to buying a blog.  It’s a fascinating read.  Make sure you read the related posts to get the full value.

Banking, Credit, and Investing or He Who Pays the Piper Calls the Tune

GLBL presents What to Expect From Mortgage Rate Trends for 2010.  I learn something every day.  Define “intraday”.

pkamp3 presents Cutting Up the Card.  It may be caused by a down economy, but less consumer debt isn’t a bad thing.

D4L presents 20 Dividend Stocks Riding The Tsunami Of Dividend Increases.  My first dividend-paying stock paid me 16 cents once.  Stocks kind of scare me.  In my mind, they’re not much different than a slot machine, so I don’t buy much.  I think I had 20 shares of that first stock.

Personal Finance or The Government Doesn’t Have to Be Involved

Matt_SF presents Personal Finance Equations You Should Know: the Cash Flow Equation.  If equations make you smile, this is the post for you.

Craig Ford presents 101 Ways To Improve Your Marriage Money Relationship.  This goes beyond finance and dips firmly into happy relationship territory.

Hedy presents My Better Business Bureau experience.  I’ve found that the sincere threat of a Better Business Bureau complaint can be effective, too.

2 Cents presents Economics: Your Personal Finance Weather Forecast.  As a sci-fi junkie, I love the quote at the beginning of the article.

Dodging Taxes and Anarchism

Nope.  No submissions in this category.

That’s all.  While you’re here, don’t forget to subscribe to my rss feed and follow me on twitter.

5 Ways to Make Shopping Quickly a Breeze

Finance

Shopping is a major time sink. Between the travel, the traffic, and the checkout lines, the actual shopping almost seems

English: An Entennmann's cake donut, bought fr...
English: An Entennmann’s cake donut, bought from a grocery store four-variety pack. (Photo credit: Wikipedia)

pleasant. Almost. Here’s my super-secret ninja plan to reduce the unpleasant time wasted while giving away my money in exchange for the privilege of not scooping manure straight from the source onto my crops to get both my burgers and my salads.

First, The List. I’m not going to tell you to use a list. You know that already. My secret? Organize your list by department. Divide the list into sections.  Make sure it has a produce section, a meat section, a baking section, and any other section you will be visiting. Don’t leave the department until that section of the list is complete. That will eliminate chasing back and forth for things you forgot, which is a huge timesaver.

Shop where you know. When you are in a hurry or stressed by crabby kids, don’t go check out a new store. You won’t enjoy it with the kids in tow, AND you’ll be tempted to buy more, since you will encounter more as you explore the store trying to find what you need.  Go somewhere you know.  That will eliminate any hunter/gatherer-style shopping.  If you know where you need to go, you’ll get through the shopping trip much faster.

Skip the bad aisles.  I resist temptation best by avoiding it. In the store, I avoid it by skipping entire aisles of stuff. If there’s nothing I need in an aisle, don’t go there. Why tempt myself with that many more choices? I’m sure I can find something I’d like to bring home in almost any section of almost any store.  So I avoid the unnecessary sections.

Shop at the right time.  Don’t go on Saturday afternoon when every other 9-to-5er is free to run errands.  If you absolutely must shop on the weekend, either go late–I prefer 3am–or go right at lunchtime when everyone  is stopping to feed the hungry children. Me? I’ll either feed them first or fill them up on samples at the grocery store.

Use less, eat less.  You’ll need to buy less that way. If you eat smaller portions, or learn how to cook with a versatile mix of staples, you’ll need to buy less, either through lower consumption or lower variety. I’m not saying eat boring, just get creative with the basics.  I know a couple of different ways to cooks rice and beans, without getting bored.  When you add the perfect-food-makers, like bacon, it’s easy to keep meals interesting.

How do you reduce wasted time shopping?

Cooking Poor

Finance

Frugal cooking can be an intimidating concept.   It’s easy to turn a meal into a huge expense, but it’s not that hard to trim your grocery budget without sacrificing variety and flavor.   It just takes some planning and a few money-saving techniques.  We usually feed our family of five, often with guests, for about $100 per week.

Schedule your meals. Find or make a weekly meal planner.  I recommend this or this.  Cross out the meals you don’t need to worry about due to your schedule that week.  If you won’t be home, you don’t have to cook that meal.  Fill in the meals in the remaining slots.  Keep your schedule in mind. If you get home from work at 5:30 and have to be somewhere by 6:30, dinner needs to be something quick. Also, make sure you include every side dish you will be serving.  Now, look at the recipe for each dish in every meal.  Write down everything you need to make all of the food you plan to eat that week.   While planning your meals, think about how to use your leftovers.   If you cook chicken breasts one day, the leftovers can be chicken nuggets the next.

Take inventory.  Take your meal plan and a pen while you look through all of your cabinets and your refrigerator.  Why buy what you already have? If you already have steaks in the freezer, don’t waste your money buying more.  If you have it, cross it off of your meal plan shopping list.  Whatever is left is your shopping list.   Review it.  Is there anything that can be combined or eliminated?  Is there a key ingredient for a sauce that’s missing?

Don’t forget the staples.  If flour or sugar is on sale, stock up.  Anything you use on a regular basis is a staple, buy it when it’s cheap.

Build a shopping list from your meal plan.  When you are in the store, stick to your list.   It’s hard, but avoid impulse purchases at all costs. Don’t shop hungry, don’t buy things just because they are on sale, and don’t dawdle.  Get what you need and get out.

Avoid pre-processed food.  We slice and shred our own cheese.    Buying the pre-shredded cheese costs an extra $5 and saves just 5 minutes.  Don’t buy pre-sliced apples or anything that will only save a few minutes for several dollars of cost.

Every couple of weeks, I cook a large pot of either beans or rice and keep it in the refrigerator.  Almost every meal that we cook gets a cup or two of beans or rice added to it.  It doesn’t alter the flavor much, but it adds a few extra servings for pennies.  It’s a healthy way to stretch any meal on the cheap.

We have a large bowl in the refrigerator filled with mixed greens.   We buy whatever salad-like greens are on sale and prepare the large salad all at once.   Most meals start with a salad, which makes it easier to fill up without relying on the protein dish, which is generally the most expensive part of a meal.  As a dedicated meat-eater, it took some getting used to, but it’s a good meal–cheap and healthy.

Cook enough for at least 3 meals.  That will eliminate 2/3 of the work involved in cooking.   Plan ahead to make your meals simple and easy.

Freeze the leftovers in usable sizes.   Stock up on semi-disposable meal-sized containers.   Freeze some in single-serving sizes for work, and others in family-size servings for last minute meals at home.  Preparing for last minute meals keeps you from serving garbage or takeout when life gets in the way of your plans.

Avoid wasting leftovers.   Wasted food is wasted money.

When you are done cooking meat, take any drippings or scraps and throw them into the slow-cooker along with any vegetable scraps laying around.  Cook it overnight, then strain it into an ice cube tray.  You now have stock/broth ready to be added to any recipe.

Plan for serial meals. Chicken breast leftover from today’s meal can become chicken nuggets tomorrow, to be shredded into chicken salad the next day.

When there isn’t enough left for a full serving, we put the remains in a resealable bag in the freezer.   When we accumulate enough to fill our slow-cooker, we dump in all of the bags with a couple cups of water.    I look through the refrigerator for any leftovers that have been overlooked that week or any vegetables  getting close to being too old.  It all gets cut up and added to the cooker to cook on low all day.  I rarely add seasoning because everything going in the pot tastes good.  We never get the same meal twice and our “free soup” is never bland.

That’s how we cook cheap, without sacrificing too much time.  How do you save money cooking?

This post is a blast from the past.  Originally posted here in January 2010.

Twitter Weekly Updates for 2010-04-03

Misc

  • Screw April Fool's Day. I'm about ready to clear my entire feed queue. #
  • I definitely need a reason to get up at 5 or I go back to sleep. #
  • Bank tried to upsell me on my accounts today…through the drivethru. #
  • Motorcycle battery died this morning. Surprise 4 mile hike. #
  • RT @ramseyshow 'The rich get richer &the poor get poorer' is true! Rich keep doing what rich people do & poor keep doing what poor people do #
  • RT @ramit: "How do you know if someone is a programmer?" I cannot stop laughing imagining half my programmer friends – http://bit.ly/9MOipi #

Budget Lesson, Part 8

Finance

This is a continuation of the budget series. See these posts for the history of this series.

This time, I’m looking at our discretionary budget. These are the things that don’t have a fixed cost. Any individual item is largely optional, and, ultimately, we don’t track these purchases closely. At the beginning of the month, I pull this money out of the bank in cash, except for 1 category. When the discretionary budget is gone, it’s gone.

  • Groceries/Dining  – At the beginning of the week, we sit down with a meal planner and (Can you guess?) plan our meals.  The planner we use has a weekly calendar with a checklist below each day to build the grocery list.  At the bottom of the page is another checklist for staples that don’t apply to a specific day’s meal, like milk or snacks.   We build the list, then transfer it to another sheet, broken out by grocery department.  That keeps me from having to criss-cross the store.   I make one lap.  When I go to the store, I only bring that week’s grocery budget in cash,  so I keep close track of how much is going into the cart.    Recently, we’ve gotten so good at making our meals cheaply from scratch that I reduced our monthly food budget by $50.   I enjoy good food, so I wouldn’t reduce this budget item if it was a sacrifice in quality.   For example, the Rainbow Foods store-brand chips actually taste better than Lay’s for half of the price.    We stock up when things are on sale and cook creatively.   Sometimes, if time has been too tight to make a meal plan, we eat solely from the pantry for a week, buying nothing but bread and milk.   By sticking to the list, and not fearing the store’s brand, we are able to feed our family of 5 1/2 for $450 per month and still eat well.
  • Discretionary  – This is for the random things that come up, and some of the not-so-random.   Toiletries, activity fees, admissions, and fund-raisers all come out of this fund.  At the end of the month, whatever is left gets tucked into a box and forgotten.   When the box gets full, it goes to the bank to be applied to debt. There isn’t a lot to cut here, since this line-item is only $200.
  • Baby stuff  – This category is continually shrinking.   Our middle kid is recently potty-trained and our youngest is trying.   There is no baby food and no formula, just 1 pack of diapers every month.   In 6 months, this category will be eliminated.
  • Gas/oil  – This is the single category that isn’t cash-based.   It makes no sense to take the kids out of the car to pay inside, especially in the winter.    Also, all of the temptation is inside. It’s much better to spend the money at the pump.    There isn’t much we can do to reduce this, at the moment.   Our next car won’t be a full-sized pickup, but we are several years from that purchase.    We’ve started clipping oil-change coupons to keep this down to the minimum amount possible.
  • Clothes  – We only allocate $15 per month for clothes.   In a good month, we don’t spend it.   We can’t eliminate it completely, because things do come up.   Over the summer, I’m hoping to completely leave it alone to save up for a new(used) winter jacket for our older daughter, who doesn’t get hand-me-downs.
  • Blow Money  – This is the safety valve.  It can’t get reduced and still work.

We’ve now addressed out entire budget, including what we can do and have done to keep our costs under control.  Looking back, I don’t see too many cuts I’ve missed.