Just a Friendly Reminder

I’ve recently set a savings goal for myself. I’ve been funneling most of my extra money into paying off my student loans, but I’ve decided to shift focus on that just a little to build up my rainy day/vacation/project fund up a bit. Trying to get $ 5,000.00 of extra money in the bank, even for a penny pincher like me, can be a little daunting. I’ve found that the best way to reach any goal, whether its going to the gym (which I’ve been pretty naughty about lately) or saving for retirement is to set realistic goals.

My tip for the day is to make a cheat sheet. I went into Excel and created a little sheet that shows if I save $X.xx each day, how long it will take me to reach my goal. I’ve done several breakdowns on the sheet (36 months, 24 months and so on) to show just how much on a daily basis I’ll have to cut out in order to reach my savings goal. I took this little sheet and slipped it into my wallet OVER my check card. That way I will have to go through that worksheet in order to get to my spending money. Is that fab dress on sale at Marshalls worth dipping into my potential nest egg? Sometimes the answer might be yes, and that’s ok! I honestly believe that in order to be on any kind of diet, financial or otherwise, one cannot totally eliminate the things you really enjoy. I have an addiction to art deco and vintage style clothing. If I can wear pearls with it, if it has a high waist, or could at any point be paired with pin curls, I’m hooked. I’m an absolute sucker for anything peep toe, and I don’t plan on eliminating these types of purchases from my life. However, keeping a very visual reminder of what my goals are per day has been a great help in making the final decision on non-essential buying.

What helps you keep your play money in your purse?

Cutting the Cable Cord

As a few of you know, Ellis and I decided to cut off our Time Warner cable. I grew up without a TV for the bulk of my formative years. When I was in my teens, we finally got the thing going. But because we lived out in the country, the only channels that we were able to receive were the local CBS, ABC and about four PBS affiliates. I don't know how we missed NBC but got four channels of the McNeil Lehrer News Hour. This, in retrospect, was a blessing in disguise. I never really acquired a taste for TV growing up and all that time I could have been watching 90201, I studied, read, and played ball. It wasn't until college that I ever had access to cable television and honestly, I felt like the preacher's kid who'd been turned out into the wild evil world for the first time. In a true homage to my inner nerd, I got totally hooked on the educational shows. Between Discovery Health and Law and Order marathons, it amazes even me that I'm not doing medical malpractice. During the intense pressures of law school, tv (which consisted of rabbit ears until my roommate Meg converted me to cable tv and internet) was a much welcome escape. A little mindless entertainment was worth its weight in gold. But once the two of us really fell into our "work groove," we found ourselves coming home after a long exausting day, flopping on the couch and watching whatever was on until it was time for bed. Don't get me wrong, I got some great tips from Clean House but after a few months we came to the same conclusion. Because both of us have demanding work schedules, the quality time that we could spend together is very limited. Was vegging on the sofa really the best way to spend those precious few hours together in the evening? We came to the conclusion that between the ever rising cost of cable and our ever falling amount of free time, that we were going to cut the cord... *cough cough* I mean cable. We called our trusty friend Will with Time Warner and said goodbye to about 150 channels, and it was the best decision we have made yet, and here is why:

"Why buy the cow, when you can get the milk for free!" - Everyone's grandma

No, I'm not talking about "that"! Me, even as technologically challenged as I can be* almost everything I could ever want to watch on TV, I can find for free online. Now by "free" I don't mean illegally downloaded on the internet "free". I unapologetically have HUGE issues with the RIAA, digital rights management and other intellectual property rights issues**, I don't condone outright stealing. But even for the IP protection purists out there, there is enough legit online media to keep me entertained for years. The first new love of my life is Netflix streaming. Even with the cheapest priced deal (which is about 9 bucks) you can stream as much of the online content as your little laptop will allow. Watching Deadliest Catch on your 12' Eee PC doesn't sound like your idea of a relaxing night? Well if you have an Xbox, you can make by the magic of technology throw it up on your 65' plasma screen TV so big you could see it from space. There are tens of thousands of titles available in both tv and movies available. While they don't have everything, there is plenty of escapist material to keep me satisfied. And while I've not watched it personally, I have it on good authority that every episode of Law and Order SVU ever can be streamed through Netflix. For more current shows, I've also fallen in love with Hulu. As if their super bowl commercial wasn't enough, they have more recently aired shows available for viewing on demand from their website. Unlike Netflix, they are commercial broadcasts, but often you can opt to watch a show (the Daily show for example) without interruption if you watch an extended commercial in the beginning of the broadcast. For keeping up to date on more current broadcasts this can't be beat.

"He chose poorly." - The Grail Knight - Indania Jones and the Last Crusade

Now, without even digital rabbit ears, every media consumption decision that we make in our household is a proactive decision. The days of getting home, turning on the tube, and vegging out to a marathon of What Not to Wear are over. The shows that I want to watch, I have to find. Looking at what is available via streaming, webisodes, and even Blockbuster has opened me up, interestingly enough, to a much wider variety of media. I've seen some WONDERFUL documentaries that I would have missed(SEE KING CORN, it will amaze you). I also have been able to create my own viewing marathons(30 Rock is best when consumed in bulk).

"Your house is your larger body." - Kahlil Gibran - The Prophet (On Houses)

I would say that by far the best part of cutting out our cable television has been the calm it has brought to our home. Of this, I have been very pleasantly surprised. I come home, not to a house with the six o'clock news blaring the days bad tidings, but to classical music. The wonderful impact of this is only further multiplied if Ellis beats me home and I'm also greeted at the back door by the smell of garlic wilting in olive oil as dinner has been started. I have read much more. Let me just say, READING the local news online is much more palatable than watching it when I get home between screaming car salesmen and sofa superstore liquidations. Adding even a small bit of calm into your home can make such a huge impact on your overall state of mind! I don't think I'll ever go back to broadcast television. Thank goodness for the internet!

Now, because this is a financial blog, I wanted to end with a little info on the returns for cutting out cable can have on your pocketbook. Currently Time Warner's basic package for cable is about $50.00. Excluding tax, installation, and hardware, by simply cutting the cord on your cable company you can save $600 a year! Do that for 5 years and invest and you can easily turn that into $3,240.44 (assuming 3% return). So what would you rather have? 100 channels of "nothing on", or a cruise to Jamaica? I say, get the pina coladas ready mon!

*I can find for free online.I knew I was in over my head when the remote control for the tv had its OWN TV!
**For more on IP, feel free to email me. My mentor and favorite professor in law school is the Queen of IP law!

Fine Asian Cuisine on a Shoestring

So as my friends and family know, I love to cook. My darling Ellis and I cook at home most nights. Not only is it cost effective, it’s a great way for the two of us to bond. We are also very adventure eaters – willing to try even the most bizarre cooking endeavor. In just the last few weeks we have cooked ceviche (shrimp and fish “cooked” using lemon and lime juices only) and beef tongue (delish if cooked correctly). This week has been pretty busy for both of us in the office, so we have sadly been surviving on ramen and easy mac. Wednesday I’d had enough. While my first instinct was to go out to eat after hours of yard work, in the interest of spendthriftyness I decided to cook a truly decadent meal at home instead. Today’s lesson – be adventurous and save big.

I am very lucky to live in a city with a thriving immigrant population. Just a short drive from home there is a “Little Korea”, a “Little Mexico”, and a “Little India”. While its not as tourist traveled as other Chinatowns, its people are just as wonderful and it has just as many unique and exotic offerings. One of my favorite dates is to go to an Asian grocery store, find something that looks yum (even though the label is often not in English), and take it home to cook. This is a WONDERFUL cheap date. Asian markets have all kinds of exciting fare. Even if you don't spend a single dime, its so fun to walk around, look at the colorful jars of eel, packets of freeze dried prawn, and other fun poorly translated household items. My adventures in cooking from the Asian grocery stores have produced results from totally disgusting to fan-freakin-tastic. This most recent meal, I can say without a doubt, has been my finest hour. And not only was it tasty, a great meal for 2 with leftovers came to a grand total of $8.65. Here is the rundown on making a cheap, easy, delicious, and exotic meal for under 10 bucks.

Tom Ka Gai - Thai Coconut Soup $5.09 for 4 servings

Ingredients:

• One packet of Tom Ka - available in Asian grocers. At my stop it was $0.99
• One can of coconut milk - also in Asian stores, but sold in the ethnic food section of most grocery stores $1.15 a can
• One can of chicken broth - $0.95
• 1/2 cup of water - virtually free out of the tap
  
• A few handfuls of sliced mushrooms - the entire container was $1.35 on sale, but this was just a lucky break
• 2 chopped green onions - I got one bunch for $0.65 which is more than enough
  

This is the most simple dish to make. Squeeze the Tom Ka (pronounced DOM ga) out of its pack into a soup pot. Its a paste and comes out easily if you run the pack under hot water first. Add all of the other ingredients, stir, and simmer over a low heat until mushrooms are tender. Keep stirring occasionally so that there is no risk of scorching. That's all there is!

Steamed Pork and Spinach Dumplings $2.99 with plenty of leftover dumplings

Ingredients:

• One bag of frozen prepared dumplings - there is a WIDE variety of dumpling types in the freezer section. Try them all. I think that of all the types I've tried so far, this one is my favorite. They are $2.99 in my grocer of choice and come in a large bag. A good serving is 4-6 and there are about 5 servings per bag.
  

Take out the number of dumplings that you plan to cook. You want them to be separated, which can be tricky if still frozen. These dumplings can be stored in the fridge, but must be eaten fairly quickly. If they are frozen together, and you can't break them apart, don't fight them. Being too rough will result in the dumplings splitting open and the stuffings dropping out. If you MUST steam them together, the only disadvantage is that they may not come out as pretty. Prepare your steamer (I use a metal steam basket, but bamboo works too) by spraying it with PAM to eliminate sticking. Place it in a pot with water (mine allows about 3/4 an inch) bring to a rolling boil and cover. Steam the dumplings for 10-12 minutes. BE CAREFUL not to let the water cook out!!!! Add water to your pot as needed to prevent burning the bottom of your pots. Remove from heat and serve immediately.

So today after work, if you are dying for some Chinese food, skip the restaurant and go to the grocery store. For the cost of Coconut soup in my favorite Thai place ($3.50 a bowl) and steamed dumplings (4.95 for 6) for one, you can make a wonderful meal for two and have great leftovers to take to work the next day. I promise, the whole office will be green with envy... and your wallet will be a little greener too!

Ugg-ly

Ok, the purpose of this blog is to share my insights on living well on a very small budget. A big part of that is style, and this morning everything I hold true about classic beauty was assaulted on the campus of the University of South Carolina. During carpool this morning as I headed to work past the Russell House (the student center for the school), in the span of just 3 blocks my inner fashionista nearly died. I could hear her screaming "OMG I NEED A SPRITZ OF FENDI PERFUME STAT!!! PLEASE!!! WRAP ME IN A BLACK PENCIL SKIRT AND A PASHMINA BEFORE I DIE!" Thankfully I have a purse atomizer of CoCo Channel so I was able bring her back from the brink. Everywhere I looked I saw *cue the music* {dum dum DA} Ugg boots. While at first blush I find these boots glorified house slippers which shouldn't be worn past the porch, seeing so many fresh faced young women in these shoes filled my mind with two big questions on the way to my office. How? and Why?

First is "how?" Not being an owner of these shoes, I will admit that I had to google their going price. I'm not sure what I was expecting, but WOW!!!! They are anywhere from $150.00 to $200.00! Where is the money coming from that these young women women can afford such a luxury? In a time in American history where cash strapped parents are working nights and weekends to support their college bound children and state and private universities whose stock-laden endowments have fallen so sharply that they are laying off staff and cutting back academic programs, I have gone from fashion opposed to fiscally shocked! I in no way begrudge these women their earthly delights. Quite the opposite in fact. I am a huge advocate of living well, but I find the juxtaposition of these shoes on a campus where there is a hiring freeze and where non-tenured and adjunct staff are being let go in droves very surprising. Moreover, I think these types of expenditures present us with a much larger issue - wants in the short term and needs in the long term.

The global economic crisis, at least on a micro-economic scale, is due in part to the shortsightedness the the average consumer. Now don't get your feathers too ruffled. I am well aware of the responsibility that business and the banking industry bears in this clusterf*%k, but this blog isn't for Bank of America, its for individual consumers. I think this is particularly true in America. We live in a culture where we are one browser click, one credit card swipe, and one fast food drive through away from getting what we want exactly when we want it. This is the "why". We are now realizing, in a most painful of ways, that this type of consumption is not sustainable. The average credit card indebted young adult household in America now spends nearly 24 percent of its income on debt payments!! (Source: "Generation Broke: Growth of Debt Among Young Americans") Now add to this, that today's average consumer has 13 credit obligations on record at a credit bureau, including credit cards and installment loans (auto, mortgage, and student loans, etc.), 9 of which are likely to be credit cards, we are spending ourselves to death on things that we really can't afford. Up until recently we've coasted, but now, people are having to pay the piper. My hope is that with this downturn in the economy that we as a people will do two critically important things. First, we will be come better educated about our finances. The time of avoiding the mailbox and screening phone calls for debt collectors is over. Second, I hope that people will become more disciplined in how we consume. We need to learn what we need versus what we want and what we can afford versus what we can't. If we can do this, Americans can rescue themselves from the economic crisis.

Now, after all of the hatin' on the Ugg wearers and gloom and doom economy talk, I want to end this post on a positive note. So why not see what that $200.00 Ugg purchase price could do for us if we spent the money in another way. Let's say you took that $200.00 and deposited it into an account paying 3% interest (a CD for example), and continued to contribute just $200.00 each year, in 10 years you would have saved $2,605.13. Translate that into monthly terms, and you are only having to save about $16 bucks a month. While I'm sure Uggs are very comfortable, which is what I hear motivates people to wear them, I think I would feel much more comfortable knowing that I had a nice little nest egg to fall back on in case there is an economic down turn when I'm in my thirties.

Eager Student Loan Pay-off-er

So after my post on Friday, I’ve become pretty much convinced that the cosmic financial Gods must read my blog. After working quite late, I go home, grab a bite and take care of the bills. The next morning, with that dirty work behind me, I skip down the driveway to check the mail and inside was a notice from the lender on my private student loan. This loan is my least favorite of all bills to pay. I took this loan out so that I would have survival money during the Bar exam and post Bar job hunt. While its still technically a student loan, the rates are higher. That rate interestingly correlates with the level of my blood pressure come bill week. I am quite put off by the lender and here is why. This lender (who I will allow to remain nameless) wants at all costs to make sure that you take 20 years to pay off the loan. This will ensure them a nice fat return on their loan. I don’t want to pay them any more than I have to, so much to their chagrin, I’m paying that loan off as fast as I can. In the little more than a year that I’ve been paying, I’ve received 3 payment re-negotiation letters – the most recent which was in Saturday’s mail. Here is my Reader’s Digest version of the letter.

Dear Eager Student Loan Pay-off-er,

Thank you for making your extra principal payments. You are must be smart and beautiful. We, however, don’t like it when you do that because we won’t make as much money. So if you don’t mind, you can make a payment of $X.xx which will ensure that you won’t be rid of us for at least 20 years. We promise, that smaller payment will be so cool! You can buy stuff you want right now like shoes and purses and we can make a BIZILLION dollars in interest because we are patient and student loan pay-off-ers are impetuous and short sighted.

We love your interest!

Mr. Bank


So for all of you out there who are also paying off some student loan (or any other type of loan with a scheduled payoff) you keep making those additional payments. Check your state law. There is no prepayment penalty on student loans of any kind, and in most states there is no prepayment on mortgages up to a certain value (Currently in SC, you can pay your mortgage off early without penalty for mortgages under $150,000.00). Your bank will send you letters about how smart and beautiful, and in time, while you may have fewer shoes, you will be working your way towards that beach house on Edisto Island.