and now for something completely different.

A • Attached or Single? Single

B • Best Friend? Izabella

C • Cake or Pie? Cake. But I'll take pie, sure!

D • Day of choice? Saturday

E • Essential item? Lip balm

F • Favorite color? Blue

G • Gummy bears or worms? Jelly babies. From a man wearing a long scarf.

H • Hometown? Chicago

I • Favorite Indulgence? Daytime naps.

J • January or July? In Chicago? July.

K • Kids? None

L • Life isn't complete without? Sleeping in!

M • Make up something bc you didn't like this one? Chocolate mint

N • Number of Bro & Sis? 1 Bro 3 Half sis

O • Oranges or Apples? Oranges

P • Phobia and Fears? Closed cabinets and doors

Q • Quote? "I won't keep calm, and you can F*@# off."

R • Reason to smile? 3! Day! Weekend!

S • Season of choice? Early spring

T • Time To Wake Up? 7:00. Ok, 7:15. Ok, really really 7:30.

U • Unknown fact about me? Um, I'm left handed?

V • Vegetable? Best - peas. Worst - tomatoes.

W • Worst habit? Noticing that the X is missing

Y • Your favorite food? Hawaiian pizza

Z • Zodiac sign? Libra

Wishing you a happy and safe New Years!

FPU : i guess it looks like a lot of work.

Last night I had a funny/odd moment.

I have been used one of these Dave Ramsey envelope systems, in one form or another, since late Sept. So, 3 months. I bought this deluxe envelope system a couple weeks ago, and it is all pretty and red, like a big wallet. I buy food and shampoo and take out and gas and whatnot at stores all over the city and suburbs. No one has even commented or seemed to notice my dorkish fishing in envelopes for cash, or said envelopes covered in my chicken scratch math. So I have kind of forgotten how odd it may appear.

Except when I stand in line at stores and watch the people ahead of me in line go *swipe*swipe*swipe*swipe*. And the complete lack of actual money changing hands. They are the ones that look odd to me, frankly.

Anyhoo, last night I stopped at CVS for 2 quick necessities and I finally got to the register, the youngish man behind the counter rang up my two meager items. Yep I had 2 items on my list to get, and I bought just those two items, despite all the clearance temptations.

Usually I might have some cash pulled while I am awaiting my turn but it was late and I was tired. Since it was the night before payday, I had to make sure I took the cash from the proper envelope. I am pretty lazy about this. I actually take cash out from wherever at the moment, usually my Food envelope since it's the one on top and the one with the most cash in usually. I keep the receipt, and later write down the amount, re-substract, and reshuffle my bills later, when more convenient. But, the night before payday the Food envelope is very slim (as it should be). The point being, I opened up my Fake Wallet and went to the correct envelope in the center, and pulled out the correct amount to pay.

The youngish man behind the counter made a comment about this. I can't even remember word for word, I was that spacey and tired. But it was along the lines of, "What are all those dividers for?"

To which I replied, something like, I divide up my money into different categories. Or somethingmumblemumble.

And he then commented, "Oh so you take the money out of the different sections based on what you're buying?"

And I said yes.umhm.mmumblemumble....

Then the magic moment. He said: "Seems like a lot of work."

Oh there are sooooo many things I could have said to that. But in my befuddled state, I just said quietly [oh this is rich]

"Well, everyone has their hobbies."

And we moved on.

DURR!

I got back in my car and I revived a bit, thinking of all the things I could have said, and did not. Because, fair point. Compared to *swipe*swipe*swipe*swipe* this seems like "a lot of work." I guess so.

I have already mentioned how it is in large part purposeful to make spending "more work" than Ye Olde *swipe*swipe*swipe*swipe*. And that works for me. Because it is a bit more of a bother for me than just whipping out a card and swiping it (and then wondering what the hell I bought and why I have no money), I don't do it as cavalierly or as often. I don't spend as easily. Which is The Point.

I've had people tell me they can't use cash, because cash runs through their hands like water, because with their credit or debit card they can see their transactions and track their spending. Well, I can't. I look at $92 at Target from 2 weeks ago and I have no freaking clue what I bought. Heck I look at a receipt from Walgreens from just a few days ago, and sometimes I can't decipher the little codes for the items I have purchased. Not to mention the gas station purchases, that I think are for gas, but they are for gas and... You know gas....and coffee, gas...and lunch, gas...and lottery tickets, gas...and and and. Then I wonder why I have to spend so much on gas every month.

The other thing is, cash also runs through my hands like water... when I have it randomly stuffed into a pocket of my purse or a pocket of a wallet, jammed in with coupons, receipts, business cards, stamps, and whatever other flotsam and jetsam I have in there.

You know when it doesn't? When it's labelled. When it's divided up. When every dollar has a little nametag. When I go to CVS and I look in my PERSONAL envelope for money, and I ignore the GAS envelope, the HEALTH envelope, the FOOD envelope, and so on. And when I look at the outside of the envelope, and it says EXACTLY how much cash is in that envelope, and I know that is the actual amount I have.

No, cash does not run through my hands like water, when it's like that.

But the point... is it work? I guess. A little bit more effort. But here is it Thursday before new years, and my written budget for January is completed. It was pretty easy because I just took my December budget, made a copy, wrote in the new due dates, and fussed a bit with some of the more fluid categories. I always spend the same amount on Food. I always give myself $25 to Blow. I had to figure out my Car category a bit more, because I need money for an oil change on top of just gas this month. I had a lot of money for Gifts in December, and I am putting a small amount in there in January, to carry over so I can build it up for birthdays this year. Because I am going to the dentist again, my savings is very low in January, and I am not putting any money into Clothes. Which sucks, because February is a great time to shop. But I need the dentist more.

Other than that.. it was pretty much the same as last month.

Today is also payday. I brought my lunch so I haven't spent any money today... except. Except that I opened my spreadsheet, and I went to the website for each of the bills listed on it, logged in, and paid the amount I had indicated to pay for the first half of January. And now I am done.

I guess it is a bit more effort. But I don't mind. It's like the person who lives in a messy house visiting the person who lives in the tidy house, and commenting that it seems like an awful lot of extra work to actually be washing dishes, vacuuming, and picking up dirty clothes off the floor. As opposed to...? Laying on the sofa reading a good book. Hey I love laying on the sofa reading a good book. I'll be doing that tonight for sure.

I guess my point is, having a nice home is always going to be more effort than having a filthy, messy home. Having clean clothes to wear is always more work than shlumping around in 3 day old pj pants. Writing this blog is always more work than not. It just depends on how you want to spend your time.

Personally, I like rifling through my money. My actual money. it's fun for me. I like seeing the debt numbers going down, the savings numbers going up. I like it. It's not work to me, just because there is some effort.

But damn, yes, I do want a Kindle. Bad.

So I just signed up on the website to TAKE THE CLASS. Take it again! I have a permanent membership so I can go to any class, any time, any where.

Did you know you can attend the first class for FREE? Yep. you register online for the class you want (just search by zip code to find one in your area), then you show up that day/night. You watch the first lesson, you meet other people, you talk about your reasons for being there, your concerns, or you just listen. If you want to take the rest of the 12 weeks, then you can buy a membership kit. But one thing at a time.

Did I mention new classes are starting in January and you can go to the first class for FREE?

======================

Photo: Dave Ramsey Deluxe Envelope System in red. From DaveRamsey.com. Jan 2012. LINK

FPU : q & a

Happy holidays! I hope whatever holiday you celebrate, it was happy. And I especially hope that your holiday spending was based solely on your income and what money you had saved, and not paid for on borrowed money. I know mine was! :-)

I really meant to post a follow up to my last post right away. It is mostly written and everything. But then as I re-read it, I was struck by the thought that perhaps, I am making it sound like it's easy. I want to be encouraging and also, pragmatic. This is not rocket science. Almost anyone can do it. But just like with running or cooking or scrapbooking, anything I have learned how to do from others, I want to apply it to my life, which is decidedly non-mainstream. I want to know what works and what doesn't, and why.

FPU is "easy" like Weight Watchers is "easy." The method is not hard in itself. But the doing of it can be very hard.

This month, December, has been very challenging. For many reasons, not all of which have to do with Christmas. I feel out of sorts right now, like I don't know what I have and how much, like I don't know what I spent and where. It's a combination of a Christmas bonus from work, given to me on a gift card (so I went back to swipe-swipe-swipe), trying to do a credit card balance transfer, an emergency emptying my savings, and Christmas spending. I did my best, but I am definitely not as on top of things as I want to be.

So I don't want to say it's "easy." It can be done. And I really appreciate having a system or a method to follow. It helps me make decisions and set priorities. But the doing is not always "easy."

So I'll get back to that topic eventually.

I got some questions from falwyn on that post that I thought I would answer.

I'm curious about how any online interactions interact with the envelope system. For example, any bills you might schedule online, or any shopping you might do there. (I live in tiny rural town, and though I could definitely stand to curtail some of my online spending, I would also not really see it as viable to give it up entirely.) I wonder about this as regards any other category that you might want to still do with a card - for me, gas. I absolutely do not want to stop paying at the pump, particularly because I like to stay far away from all the temptations of the inside of the store. Anyway, if you have comments on any of that I'd love to hear it.

There are many ways to answer these questions. It's hard to know where to start. So much of the answer is tied into my budgeting, which I have not posted about yet.

One thing I want to point out, which is important. Our society is set up to make spending money easy. Consider these examples in the comment:

1) Scheduling bill payments online.
2) Online shopping.
3) Buying gas at the pump with a card.

Not meaning to pick on anybody; these are just some really good examples.

One of the very basic behavior modification methods used in FPU is to transfer spending money from easy to hard. Or at least, not-so-easy.

• Easy = Mindless
• Easy = Not Paying Attention
• Easy = Spending More Than You Intended
• Easy = Fun, Not Painful

Dave says: "One study in particular conducted by MIT and published in Carnegie Mellon magazine, indicated through the use of magnetic resonance imaging (MRI) that the pain centers of the brain are activated when you spend cash." (click to read entire story - it's good)

I do not want my spending to be "easy." I do not want it to be mindless. I want all my spending to be mindful. I want to feel it when I do it.

Therefore, I have moved myself from a place where my spending is easy, convenient, and therefore mindless, to a place where it takes some effort to spend money, and I thus forced to really think about it before I do it. FPU is designed that way, because it is a behavior modification system to teach people how to be mindful with money.

To specifically answer these 3 scenarios:

1) Scheduling bill payments online/automatic payments.
This is tied up in how I budget for the month. The very short answer is, my budget has a line for every monthly bill as well as for spending categories. Therefore, I know with every paycheck how much I need to stay in my checking account to pay bills, and I take out the rest and keep it in cash.

My own budget has several vertical “regions.” See the example budget I did for my sister last month, using sample numbers, which I color-coded for easy reference (click to see larger).

First “region” (blue) is all the budget categories with the total in each to pay or spend per month. Next to that is total income. The budget numbers subtract from the income column, and that is the running total. I could have just these 2 columns and that would be fine.

Next is the breakdown by pay period. The orange section is the income for the first half of the month - her and her husband’s paychecks combined. Each line indicates how much of that paycheck is going to that bill or category.

For example: Rent and utilities are paid out of the 2nd paychecks, so those amounts in orange are $0. The green section is the 2nd half of the month, and there you see the rent and utilities payments. Cable is $0 in the green section. It is due earlier in the month, so it is paid from the orange section.

In this way, I have the auto withdrawals and bills I need to pay “scheduled” based on which paycheck they come out of. On my version of the budget, my car insurance is automatically withdrawn on the 7th, so I have the amount for that in my “orange section” and that line says $0 in my “green section.” The column to the far right has a list of due dates for each bill so I know when to pay it.

My own budget is done a little differently, but this is a good example.

2) Online shopping.
The short answer is, I don’t do it. FPU is about getting out of debt and then building wealth, not buying stuff. I am on Baby Step #1 - Save $1000 in cash for an emergency fund. Until my debt is paid, I don’t buy anything I don’t need (theoretically - in reality I do, sometimes, because we all want to live, not just exist). My experience of online shopping is that it’s mostly for wants, not needs. I don’t buy milk, bread, diapers, shampoo, gas, etc online. There’s nothing I truly need to buy online.

The other thing is...hm. Well. Everybody has got their thing. Their thing is the thing they won’t or can’t change. Their thing they have to live with or work around. Online shopping is not my thing, so I don’t have to work it out. But I do have a thing, or a couple of them, and those things require thought, experimentation, making mistakes, recovering, and trying again.

For example, I won’t switch banks, and my bank is a 45 minute drive. So how do I get my cash out of my bank? That’s my thing. I really have to work with that. Another thing - I can’t cook at home, and I can’t really store perishables either. Therefore, I eat a lot of takeout. Most people cut their eating out to almost $0. I really can’t do that, unless I want to suffer from severe malnutrition. That’s my thing. I have to work with it.

Dave may say this or that, but Dave also has his own house, and he has a wife who is a full time stay at home mom, who does the grocery shopping, the cooking, and the cleaning up. Dave brings his lunch every day like that is some kind of accomplishment, but he is not the one shopping for the food, planning the meals, cooking the meals, washing the pots and pans, and packing the leftovers. If Dave had to do all that himself every single day, plus work full time, plus commute, plus do his own laundry, Dave would be eating lunch out more often.

Speaking of Dave…Funny story. Several weeks ago, I got an email from Dave Ramsey promoting a speaking tour. There was one date that was close enough for me to attend. Now, Dave’s pricing is based on time. The first xxxx people get tickets at $xx, the next xxxx get tickets a bit higher in price, the next xxx get tickets higher, etc. Therefore the faster you buy your ticket, the cheaper it will be.

I wanted to go. Tickets at the time I got the email were up to $20. I could afford that, and the date was in the spring so I could save money for the trip.

But. I could only buy the ticket online. I had $20… but I didn’t have $20 in my checking account. All my money was on me in cash. I had maybe $13 in my checking account. I had several hundred in my savings, but that is for emergencies only. Seeing Dave Ramsey live is not an emergency. The other option was a credit card. But we are supposed to have cut up our credit cards.

Oh Dave, Dave, who came up with this plan? Do you not see how the very people your talk is for should not be able to attend, if they are doing your system correctly?!?!?

So no, I will not be seeing Dave speak live.

Now, all that being said, Dave was having a $10 sale on his website, and after 3 months my paper envelopes were really ratty and needing replacement. So I bought this little number online. But I believe I have mentioned I am a little out of whack from December. Not over budget, but out of whack.

3) Buying gas at the pump with a card.
The short answer is: I don’t do it. The longer answer is, this was a big topic of discussion in my FPU class, because walking into the gas station and standing in line to pay is a giant hassle. No one wants to do it. Everyone wants to swipe at the pump, for whatever reason.

I don’t do it. I don’t want to swipe anything for any reason.

I have budgeted $30 a week for gas, based on my usage over the past 6 months. Since I commute to work daily by train, I don’t drive much daily anymore. Therefore, on weekends I have time to fill up, and I do so then. I take $30 in cash out of my envelope while in the car, I walk in and buy $30 on my pump, and that’s what I put in my car.

The first time I did this, I paid $35, since I wasn’t sure yet how much I would budget for gas. A fill up was $33.85. Oh you bet I walked back in there and waited in line, again, and got my change. I also got my receipt. Toto we are so not in Kansas any more. Since I only fill up once a week, and it’s usually late Saturday evening, I have the time. Doing this really woke me up. Made the whole thing seem real in a very visceral way. Yes, sometimes I have to wait in line. Twice. Yes, sometimes $30 is not enough for a total fill up.

Yes, sometimes I buy something else in the store, like coffee or a soda. I know I am planning to do so when I walk in. I bring $35 or $40 with me instead of $30. I get a receipt. I subtract the extra amount from my food budget (writing it on my Food envelope, and recalculating my total). At some point I reshuffle my money to match the totals written on my envelopes.

For others in my class, buying gas at the pump is their thing. If you have a baby, of course you are not going to drag the kid in and out of the gas station while you buy your gas, especially in the cold. That’s not a choice based on laziness. We discussed various options, which included keeping the amount you have budgeted for gas in your bank account and buying using a debit card, as well as the idea of purchasing gas gift cards at the beginning of the month, storing the card in the Gas envelope, and using those specifically and only for gas.

So that’s how I try and deal with those issues. The short answer, for me, is always: the easier and more convenient it is to spend money, the more I have to watch what I am doing. The more likely it is that I will mess myself up. People have to use different methods to deal with their things. I have things, you have things.

The question is always: can you afford your things? Are your things holding you back? I have had to really think about that.

================

Photo 1: Holiday budgeting. From "Christmas will send one quarter of us into debt." By Lucy Bower. ThinkMoney.com. 21 Dec 2011. LINK

Photo 2: Budget sample. Created by me. Dec 2011.

Photo 3: Dave Ramsey Deluxe Envelope System in red. From "Longing for Freedom." A Blossoming Homestead Weblog. 22 Sept 2010. LINK

FPU : envelopes + the quickie budget.

When I've talked to family and friends about Financial Peace University, many are very interested. The giant hold up? Switching to a cash-based spending system. Using Ye Olde Envelope System. It was one of the biggest roadblocks for me as well.

Starting with envelopes was hard. It was intimidating. But it was all mental, because in reality, it's not that hard. I have a freaking Masters degree, ok? It's not that hard. It just seems hard, because it's new. And it's "less convenient". Which is the point - it's less easy to spend money now. It's impossible to mindlessly spend on anything.

I did it. And now I can tell you it is one of the biggest changes, the most positive changes I have made. And also? It becomes a habit. A positive habit. After the first time, I just repeated what was successful and changed what wasn't. No problem.

There are actually many ways to do it. Many people do it virtually, not even using real cash, and there are apps and software to do it that way (I think that removes one of the most positive parts of this system -- making it hard to waste money thoughtlessly, but it is possible to do it that way). Some banks allow you to open and maintain multiple accounts, which you can use for various categories, especially when you are building up for some future expense.

For me, I use paper envelopes and I use actual cash. I love it. I take my cash out of the envelopes regularly. I count it and recount it. I shuffle money around as needed. I check what I have in cash against what my envelopes say I should have. I keep a runny tally of what I buy and how much it is. I watch the numbers go down as I spend. It's the day before payday, and I have $6 in cash on me for Food. That's it. And that's how it should be.

I have read many ideas for envelopes. Obviously, just a stack of regular business sized envelopes will work. You can also make or purchase very pretty envelopes.

I also read a blog where the family uses pretty zippered pencil pouches for each envelope. Those are very durable and they will hold coins (more on coins later).

With my FPU membership I received a kit of materials, and one of these was a booklet of small envelopes bound into what looked like a dark brown checkbook. It came with several loose envelopes as well. Each of these envelopes has a ledger printed on it for keeping a running tally. (See Photo 1 above)

It's pretty convenient, it's subtle and discreet. It doesn't look so girlie, so the husband can carry it too.

But I was reluctant. Here were my hold ups in starting this system:
• I was used to being disconnected from my money as money, and from my spending as spending.
• My bank does not have any branches close to me. How do I take out this much cash without having to make numerous ATM withdrawals with numerous fees?
• I didn't know what cash categories I needed to have. I figured I needed Food, Gas, Personal Items...?? What other things did I spend money on?
• I didn't know how much cash I actually had left to spend after my most important bills were paid. So how do I know how much to take out of the bank?
• I work in an office downtown, so once I leave the house I don't go back for 10 hours. What money should I carry with me daily? How much? How do I track it? What if I lose my money or get mugged?
• I don't get paid on the 1st and 15th. My first paycheck of the month can be as late as 6 days in. How do I do a monthly budget that doesn’t include money coming in on the first day of the month?

In FPU classes, this is a process you go through with your classmates. The process of: being sort of afraid and uncertain, but doing it anyway. Knowing you will make mistakes, and doing it anyway. Feeling reluctant, and doing it anyway. Not being sure how to proceed... and doing it anyway. You getting the point?

As Dave Says: This is a marathon, not a sprint. No one is supposed to do all this in one day or one week. You ease into it. Slowly.

First - The Quickie Budget

I looked at my bank account online and found out how much income I had in a month, based on the past few months. (just an average or a good estimate - it’s not a math exam) Wrote it down. I estimated what Dave calls The Four Walls: How much do I need for food? (total ballpark - I picked $400 a month, arbitrarily) For each utility? For rent? For car/gas? (do-able using old transactions online and looking for gas stations). Added it all up. This is my basic money I need to live.

Then I looked at and wrote down every monthly payment or expense I was paying out of my bank account, other than these. So that was mostly debt repayment. Added that up, for another number.

Subtracted it all from my monthly total income. First I subtracted the Four Walls - this is what I need to live. Living comes first. Then I subtracted the bills.

Very important - I did not calculate my debt repayment first, just because that is a known number, and easy. And then see how much I had left to live on. First you need the bare minimum to live. Once you have food, rent, keep the lights on, and some way to get to work, then you can address the rest of your expenses. Luckily I am not in that bad a shape, but some people are. The Quickie Budget Form doesn’t even have places to write down student loans or credit card payments on it.

This in itself was a revelation. A different way of looking at my money. First I need to live. First I need to eat.

I was then able to mark off the categories or bills I would move to a cash basis (for instance, I pay my rent in cash). I was then also able to add up my monthly standard bills and figure out how much money I had left, after my regular bills were paid.

So this process addressed, at least in a minimal way, some of the hold ups I had:

• I found out what my actual income was per month. If you have varying hours or work for yourself, there are ways to address that. I just didn’t need them, so this is what I did.

• I found out how much I was paying out in debt payments per month, total.

• I minimally figured out some categories. I minimally picked some numbers to go in each category, just to start.

• I picked what I would be moving to a cash basis, and what I would continue to pay online.

• Then I was able to add up about how much cash I would need per month, divide by 2, and that was my per paycheck cash withdrawal.

This is a really easy process if you’ve mostly been using card/s to run your life, since you can look at transactions online. 20 minutes! It’s a QUICKIE Budget. Just get a round number in there. Just write something down. If it’s wrong, change it when you find out. JUST PICK A NUMBER AND WRITE IT DOWN.

So if you are starting from nothing, and don’t know where to begin, we began here. And then we sat with it. Didn’t jump into envelopes. Didn’t withdraw cash. Didn’t change much. We were, at this point, working on saving a $1000 Baby Emergency Fund in cash. That requires things like cutting off cable, buying groceries and eating at home, brown bagging your lunch, selling things around the house, picking up overtime at work, babysitting, cleaning someone’s house. It’s a lot right there.

We took 2 weeks of saving and having this Quickie Budget done before the first of October came, and then we moved to envelopes. So if you want to do the process in The Total Money Makeover, I suggest the same. Don’t do it all in a weekend, unless Cold Turkey has worked for you in the past. Consider also if you have a family, they need to be on board with this, and they need to be helping.

Next up: more on the Envelope System.

=====================

Photo 1: Cash in the Dave Ramsey Basic Envelope System. "The Credit Card Monster." Simply Mel Weblog. n.d. LINK

Photo 2: Pretty cash envelope system. "The Cash System: More information than you ever wanted to know." Kelleigh Ratzlaff Designs Weblog. 10 Jan 2010. LINK

FPU graduate.

Well, my 13 weeks is over. I am a Financial Peace University graduate. I had to miss the last class because I had a funeral that evening. I am left with a curiously unfinished feeling. But since I have bought the membership, I can re-attend any time I want, any where. I am planning on finding a clas in the new year so I can keep on track, keep gettng support and ideas, and attend the 2 classes I missed. I actually wish I could run a class, but for that you have to have a church to sponsor (or buy the teaching materials and get people to attend) and that is not happening.

In case you were wondering how it went...

When I started, I really didn't know how I could possibly save $1000 in one month (as Dave Says) or even in two. My budget is very tight. I make decent money, but I am very far in the hole due to the long recession and my career change. I have tried ways of generating more income but nothing has panned out thus far.

Where I Was:

• I had no idea how much I spend in a month on food, gas, personal items, etc.
  
• I didn't know what spending categories I needed and used, other than food, gas, personal items, and regular monthly bills. I knew there were more.
  
• I make enough to cover my expenses, but I had no real play in my month and couldn't really save anything.
  
• Having money in savings made me feel somewhat uncomfortable, not safe.
  
• I never actually knew how much money I had to spend. I always had bits and pieces of money here and there.
  
• I had very little idea of exactly what my interest rates were on various loans, or even the exact total of my student loans -- though I knew the exact monthly payment amounts and the due dates for everything.
  
• I didn't know what my credit score was, but I suspected it was not good.
  
• I lived paycheck to paycheck, and if I got through a month with money left over, I called it good.
  
• Once-in-a-while expenses (like renewing my plates) would throw me for a loop and then I'd struggle to catch up.
  
• I had no way of handling emergencies other than credit cards or not buying food. I lived with a low level of anxiety over my car breaking down, my teeth needing dental work, or my dog getting sick.
  
• I had spent time before (years, in fact) in tracking my spending, but I never was able to create and stick to any kind of budget, usually due to minor emergencies and unforseen expenses messing me up.
  
• My car insurance had been suspended for supposed non payment (a long story) and I didn't even know. Yeah, I thought I was insured, and I wasn't! For months!

Two weeks ago I had an emergency. It was traumatic, but not financially. I was able to pay for what I needed to out of my savings, and not out of my future paychecks. My energy went solely into dealing with the emotional fallout only of the emergency - not the financial issues. I immediately put money back into my savings account, whatever I had. I am back to building up my savings. It may take a few months because I am out of things to sell and have consolidated all my money.

Where I Am Now:

• I know how much money I have, everywhere, all the time.
  
• I know what my spending categories are.
  
• I know how much I spend in each of them.
  
• I know how much a 20 oz. bottle of Diet Coke costs downtown, because I drink one every day. I know that it is $2.24 at certain news stands, $2.51 at Jamba Juice, $2.05 at Walgreens, $2.11 in the Sears Tower ("Willis" Tower) news stand. I know it is 65 cents if I bring it with me to work.
  
• I have $400 on me, in cash, right now (shhhh, don't tell robbers). Most of it is allocated for things I have to pay out in the 2nd half of the month.
  
• I know all my interest rates and all my balances on every single loan -- credit cards, student loans, personal loans, etc.
  
• I have reveiwed my credit report.
  
• I regularly live with less than $15 in my checking account, and I don't care.
  
• I feel uncomfortable with less than $250 in savings. I am uncomfortable right now!
  
• I have a written budget, on a spreadsheet, for the whole month of December.
  
• I buy groceries and bring my lunch to work regularly, and I eat dinner at home regularly.
  
• I have car insurance with a fantastic agent. I know exactly how much coverage I have, for what, and how much it costs. I know when they will withdraw the payment from my account and how much it will be.
  

Most indicative:

For 18 years, I have had to renew my plates by Dec 31st (I always seem to buy cars in December). And for 18 years, I have bought my sticker on Dec 30, or sometimes at 11:30 pm on Dec 31st, from the 24 hr currency exchange. I have always had to use cash gifts from Christmas to pay for the renewal, because all my cash in December went for Christmas. This year, I already have my sticker. I bought it with money I had been putting aside and compiling since October. It probably took only 15 minutes to buy it. It probably took the same amount of time as other years, but it did not feel as stressful and frantic. Because I wasn't doing it at the last minute, because I wasn't wondering how I could pay for it.

It really helped me to read blogs that gave details of exactly what people do or have done. I got great ideas and adapted some to my own situation. So I’m going to cover a few of the things I learned along the way. And since I can be rather prolific when it’s a topic I am learning about, I will break it up into a series. Come back soon for the next installment. Some topics I will cover:

• Switching to a Cash-Based Envelope System.
• Creating a Written Budget and Using It
• Shifts in Attitudes Towards Money
• Random Tips and Tricks

and whatever else I think of.

If you're not interested, that's ok. I don't mind. Come back some other time!

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1. Photo: Financial Peace Junior. From "Money School is Now in Session." Matt McGee Weblog. 6 Aug 2008. LINK

i miss running.

My posts last year at this time were all focused on running. I could not wait until the warmer weather so I could spend more time building speed and distance.

Well, what happened? My spine happened. I have had spinal problems for a few years now. You know it's bad when laying flat in bed causes pain. I have had an MRI, a painful nerve test, and other diagnostic tests. Once I got past the shin splints I discovered I still could not run or even walk an entire mile without stopping due to pain.

My spine is so bad now that I can barely walk more than a block without pain. It's hard to letterbox. It's hard to grocery shop. Forget about carrying anything or even walking slowly any distance. It's so painful. I walk 2 blocks between the train platform and my office daily. Some days I can only make it one block and then I have to sit and rest for a moment. Not rest my legs or my lungs - take the pressure off my lower back.

I have been to the doctor. He said even surgery was just a temporary fix. He suggested some exercises. Just the same regular stretching exercises I have always done.

The thing I liked was going OUTSIDE. Even in rain, even in snow, I liked going outside, getting fresh air, moving and seeing the landscape change. Staying in my house and trying to find a few empty inches to do some exercises is not working for me.

Even before I ran, I was a great walker. I loved taking walks, cold, snow, rain, summer, winter, fall. I had a dog, just so I could take her for long walks, and it forced me to go outside every day no matter the weather. Now I can't even shop at Walmart. I can't stand in the line that long.

I miss running. I miss it a lot. Last week I walked with some coworkers to a restaurant for our holiday luincheon. I got terrible shin splints after only a couple of blocks. After about 5 blocks I didn't think I could make it and I was looking for a cab.

It really sucks. So that's why I don't write about running any more. :-(

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Photo: Fat runner. From: "Cool as a Cucumber." A Failed Unicorn Weblog. 31 March 2011. LINK

FPU : a big emergency.

This week will be my last class of Financial Peace University. I will miss going to this nice church, with nice people, every week. I will miss the support and friendship. I will miss learning new things.

I have been reflecting on my experience. Before I ponied up what seemed like a chunk of money for this class, I did some research online. It was hard to find any information that was not put out by the Dave Ramsey organization, and of course, they are involved in selling their product.

For me, I can say this. I read the book The Total Money Makeover several years ago. I thought it was more than a little crazy, and not applicable to my life. I went on with what I had been doing. I got used to living in what felt like semi-poverty, and always being worried.

I did not even realize that's how it felt until I had a personal emergency over the weekend that depleted my Baby Emergency Fund, which wasn't even fully funded. And I had to run my credit card back up to the limit (this would be a no-no in Dave's World, but I am telling you, this really was an Emergency, and I needed every penny), after paying it off and not using it for several months, and enjoying watching the numbers go down.

After I wrote the Big Check, I had to take care of some related things. When I finally had a moment to breathe, I felt this tightness and anxiety in my chest. I realized it was because I had a couple days to go until payday, no money in my checking account (well maybe $15) and no Emergency Fund. No space on a credit card. Nothing. Nada.

It just blows my mind, that this is how I lived pretty much every day. For years! Even when I had some money, I was just waiting for it to be gone as I knew it would trickle away eventually with little shortfalls and things that just come up.

The first thing I did, the same day, was to drive over to my bank and deposit all the change I had been saving. I try to only spend whole dollars and I toss the change into the bottom of my purse. Every few days I take the change out and put it in a pretty box on my dresser. When I get a good chunk, I put it into a ziplock baggie and move it along. I hadn't deposited the money yet because my bank has shortened their hours and it is hard for me to get to a teller window these days. But I had the bags of change on me so I deposited them right away into my savings account. Not checking. Not spending. SAVINGS.

Immediately I felt a sigh of relief.

Then I drove to 3 stores and returned all the small Christmas gifts I had bought for adult relatives and friends. I'll be baking cookies, and the children will still receive gifts from me, but my adult relatives and friends will have to be content with baked goods. I then deposited that into my savings account.

By the end of the day I was back up to $110.00 in savings. Not much, but far more than zero. I had my December budget already done, on paper, on purpose. Every dollar was pre-spent. So when payday arived today, I immediately transferred over the amount I had pre-decided to save.

The really important thing that I noticed -- I did not want to go even 24 hours without some kind of savings. Contrasted with the me who went for years with only the extra unspent money in my checking account as any kind of savings. And I had no dribs and drabs of money laying around -- not even loose change in the bottom of my purse or in the change cup in my car. Every loose penny was deposited at the bank.

It turns out my need for a crown has become urgent. I have an appointment with the dentist for next week. Because I asked, I know how much the crown will cost and my own part after insurance (thank you, insurance). It is a lot, several hundred dollars. And I have not been saving for it, because instead I was saving my emergency fund. It's ok though. I redid my budget and I made arrangements to spread out the cost over the course of my appointments.

And despite all this, I still have fun in my life. I spent a day with my BFF this past weekend. We went to a belated birthday brunch at my current favorite restaurant , where I enjoyed their exclusive pancake flight (this weeks was Vitamin C infused, so I had flavored pancakes with grapefruit, orange, cranberry and mango toppings) and well known orange-roasted coffee... saw Dolphin Tale in 3-D for a whole $4 per person... went grocery shopping so I can bring my lunch most of the week... our workplace holiday lunch is this Friday. I am also getting a cash bonus for the holidays, which can go to savings, or the dentist, we'll see.

Life is good. I feel like thngs are on track. Even when a big Emergency happens, life doesn't get off track. I could deal with the Emergency in itself, without having to also freak out about the money. Sure, it's rotten to have to start all over again... but I also didn't write a check against December's monthly income. I am not starting in the hole.

I've been looking for some kind of little part time job or a way to bring in some extra cash. No luck yet, but I am open to it and I have been replying to job ads and asking around. I can't wait tables or do retail, since I have spinal problems so I can't stand for long periods. But I have a car, and there is always delivering pizzas, right?

If you have not done FPU and you are thinking about it, all I can say is: It is worth the money. If you DO it. Just showing up and listening won't do it. You have to DO it. You have to make a budget on paper, and you have to force yourself to stick to it. I find the envelope system is a great way to FORCE me to stick to it.

I also find that the lessons of FPU spill over into the rest of my life. I did laundry on Saturday, and then I picked out 4 outfits for work with accessories and underthings, and put them on hangers outside my closet. In the cold dark this morning, I did not have to fumpble around wondering what i could wear and trying to pick accessories. I just got dressed. I bought 4 soups, 4 bagels, and 4 apples for lunches this week, plus a few little treats. I didn't ahve to fumble around to get my lunch together. I just grabbed it all and went.

I love being a spontaneous person and flying where the whim takes me. I like that setting up some of these regular areas in advance actually means I have more attention available to give to the REST of my life. To the fun parts. It actually makes my life LESS boring.. in a really fun way.

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Photo 1: Budgeting. From "What the Proposed State Budget Means for Los Angeles County." Don Knabe, County of Los Angeles, 4th District Weblog. 10 Jan 2011. LINK

Photo2: Pancake flight at Orange Restaurant Chicago. Taken by me (sorry for the cameraphone quality). Dec 2011.