Mint:

SmartyPig: Who doesn’t love a 2% return on a small-balance savings account? Just try to beat that with your local bank for a minimum deposit under $100. This is like savings account and gift registry, with all the convenience of an automated 401K contribution. Set it and forget it—literally, and there’s no charge to use it. These handy free savings accounts are set to automatically transfer from your primary account at any bank over to your SmartyPig account until you’ve reached a savings goal. You can even use a widget to show your savings goals on your Web site or Facebook. Kids’ college fund, honeymoon cruise, or just your annual Christmas shopping savings account, this is free, convenient and cute. Check it out! (Also, they offer great customer support via phone or Twitter!)

Podcasts: My personal favorite is The Dave Ramsey Show—especially the “Debt Free Friday” shows. I plug this one-hour daily podcast in and hit the treadmill. So far I haven’t lost any weight but I’ve lost a lot of debt!

NetQuote: If you love shopping for insurance… you’ll be disappointed. But if you’re like me, and would rather hang out with your dentist—a wealth of free quotes is pretty spiffy and saves time and money.

SmartHippo Nope, the name doesn’t tell you anything, but SmartHippo.com can tell you if you can get a better deal on a mortgage. It’s smart and social search engine is an awesome tool for getting the best deal out there—it helped me get a screamin’ deal on a refinance earlier this year.

Credit Score: You don’t get your full credit report, but you can monitor your credit score for free at CreditKarma.com. Handy for a multitude of reasons, and allows you to watch for long-term trends in your credit history.

Blogs: The blog world is vast. Most bloggers aren’t experts in their area. I’m no personal finance expert—but I’m an expert on my situation—and you may find some things are similar to your situation. Perhaps we can all learn something from one another. Not only is the blogsphere a great resource for creativity and ideas, but also for community. We get to know our readers and our readers get to know us. It helps keep us on track and accountable.

So—speaking of staying on track and accountable—what have I missed? What are your favorite free financial tools online?

This is the first time we’ve had to consider the whole family on one plan—and to shop around for the best deal—the last time we’d added our newest daughter and I on the plan as secondary insurance—just in case of layoffs at my company. It turned out to be a good move, as it became our primary insurance within a month.

So, how do you compare plans?

Our options range from $373 a month to $71 a month for our family of four—but how does one choose the best plan for their family? How do you compare tiered versus flat-fee prescription coverage? What about formulary/non-formulary medications? How do you compare deductibles, annual maximums and other items?

These questions and growing dissatisfaction with our current company’s bizarre fee structure has had me probing this problem for answers—and the best deal.

Here’s what I’ve discovered:

1. You must consider your needs. While my family is in generally good health, both of our daughters have chronic manageable health conditions that require extremely expensive medications. For us, a $2,000 annual maximum is no problem—provided we know we’re not going to be spending $10,000 on medications in a year. That is to say, we’re all in good health when we’re on our medications. If we expected an inpatient hospital stay or a kidney transplant to be part of the process, we may choose a different plan.

2. You must consider your providers. Who do you want to be seeing? I called our doctor’s office to see which plans are accepted. I also called the social work department at our local Children’s Hospital to see what they recommend in terms of coverage based on our kids’ conditions. The hospital informed me that because we make less than $106,000 annually—they won’t bill us for anything beyond our insurance company’s share of the bill. We just have to provide quarterly income verification. I wish I knew this about $2,000 ago.

3. Consider your health, both physical and financial. Can your savings account take the hit of you in the hospital for a week? Can you cover 25% of an inpatient stay, or should you look at a plan with a co-pay of $200 for an inpatient stay? Take annual maximums and deductibles into account. On our plan, an annual deductible of $4,000 per family is really not that bad, considering we only pay $123 a month.

4. Consider your prescription uses. I called our pharmacist and asked for more info about our co-pays. One of my daughter’s medications ranges from $5 a dose to $5.80 a dose. Our current insurance just has us pay 30%, not a fixed amount—so our co-pay varies with the cost of the drug. She suggested I ask the prescription plan about specifics on the medication. Our youngest will require extraordinarily expensive medications soon, so I called the prescription plan to inquire. They provided me with an online calculator that shows the current price (just like a commodity) of each drug so I could calculate my price. (Usually about $44 a month). They then said that if our doctor would fill three months at a time, we could get 3 months for a total of $50. (A savings of $328 a year!). I could calculate the medications that our littlest daughter will be on later and see that, as feared, they’ll be expensive.

5. Don’t forget to consider all of your options together. Remember the little daughter with the crazy-expensive meds to come? She doesn’t need them yet, but she will, and a 30% co-pay could be devastating, but remember option 2? Our little one’s medications are covered through the hospital’s pharmacy (our regular pharmacy won’t even carry the meds)—and any part not covered by insurance is covered by the hospital.

In the end, it turned out that the insurance company we have is actually the best deal for our family. Ultimately, I’m disappointed (and embarrassed) that I didn’t learn to navigate this plan a little better when we first signed up last year—it would have saved us almost $5,000. If you don’t understand your health insurance, trust me—it’s worth the time to sit down and figure it out. It took me about a half day and a half-dozen phone calls, but was well worth the effort.

I called every service provider to our household and demanded a better deal. In all but one instance, I got a better deal. Now for ten months, I’ve been resting on my laurels.

We’ve been in our Financial Peace University (FPU) class for three weeks now so we’re in to budgeting and cash flow, and had to create a zero-based budget. More on this later, but ultimately, it makes me really uncomfortable, so I wanted to whack down our fixed expenses even further.

This week I took a look at all of our expenses from largest (house) to smallest (my gas money—at about $35 a month) and made some likely targets for a better deal. Here are my results.

Newspaper

My husband likes to read the NYT on the ferry to work though, but he doesn’t touch it on weekends. Total cost: $65.00/mo It really was always our intentions to read the weekend papers… but, well, you know where good intentions get you. This week I phoned the circulation desk and asked for a deal. Could I drop the weekend papers? They seldom do this for residential addresses, but they agreed. New cost: $30 a month!

Mobile Phone

I have a contract with my provider. Two lines, two phones with data plans. I use my phone for my business, but rely very little on actual minutes—more on the ability to send/receive data on the road. I checked out the competition with www.billshrink.com and saw that my $260/mo bill wasn’t exactly competitive. Mind you, I’m under contract, so I don’t have a lot of leverage here, but I tried anyhow. I called and asked for a plan “that fit the family better.” And they were happy to oblige—reviewing our past use history, and reducing our bill to $120/mo with no change in service. Just fewer “anytime minutes” (though we’ll still have more than we’ve ever used in a month). Total savings: $140/mo!

Food

We’re a family of four, and food is a major expense. I’ve been tackling this with a series of $1/serving dinner recipes, but have also found that meal planning saves a fortune on food. We’ve literally knocked our weekly grocery bill from $150/week a year ago to $90 a week now (and that’s adding one person and disposable diapers to the expenses!) We don’t waste food due to spoilage. We also batch cook a few “convenience” meals for those days when nobody wants to cook. Total monthly savings $120

It’s amazing the difference that such a few little changes could make! The total monthly savings of these easy changes is actually $295!

The scissors had to come out.

When the time came for me to create a budget and cut out all the extras, I really struggled. I had grown so accustomed to being pampered! I would get manicures and pedicures at least once a month. My hair would always get colored every 8-10 weeks and I would get a monthly massage.

Changes were made.

As it stands right now I have not had a manicure or pedicure since my birthday in 2008 and it was my gift from my boyfriend. I did get my hair colored and cut recently but the coloring was free. I always try to look for when salons are offering classes to their staff and you can usually get a cut or color for free. For a while I was no longer getting massages either.

A chance meeting.

As chance would have it I ended up becoming friends with a massage therapist that owns a spa. I learned that in this type of service industry people will trade each other for services. I never thought that I had any skills to offer someone to trade but I guess I do. The spa owner and nine other people participate in a 24 hour running relay in the mountains. She is the team’s contact/organizer. Last year she was over whelmed and asked if I could help her out with getting everything ready and everyone signed up. She offered to trade me for four hour long massages. These are valued at $60 each.

The POWER of the trade.

Because of the power of the trade I now go in every two weeks to vacuum, dust and any other light cleaning they need. I am normally there for less than an hour and I end up getting one massage for every time I clean the spa.

Be careful!

You can post ads on free sites such as craigslist or call a place you are interested in trading services with and see if anyone is willing to accept your deal. Unless this is someone that you are already acquainted with please use extreme caution when meeting strangers. Also be cautious about what personal information you give out as well.

Best regards,

Maeghen

Image Credit: FreeDigitalPhotos.net

I’m finally doing what I always should have done, and what I thought nearly everyone did.  I’m budgeting. An actual written budget about what gets spent in the household. And my family sticks to it.

Being a personal finance writer, my money is a pretty open book, as I often write from experience, but I’ve recently had a rash of people either believing or treating me as if I was broke. Where did I mislead them?

A few times recently I’ve been invited to a party and heard “but don’t bring gifts, we know you’re on a budget” or “we don’t want to cause you any hardship…”

What?  Hardship in celebrating our loved ones birthdays?  Hardship in having guests for dinner? No way! We’re on a budget, not broke. Those gifts and entertainment opportunities are budgeted for, believe it or not.

On the contrary, we’re on a budget because we have seen the symptoms in our household of more than enough.  You know, spoilage (in children or in refrigerators, the root is the same), glut, clutter, and increased desire for “stuff.”
We put it all to rest with a budget. When my toddler wants something at the toy store I can say “no honey, we didn’t bring our “Melat toy money.” I will take that next week when I go shopping for your birthday present, but right now it is time to shop for our friends’ present.”  We model healthy financial behavior and avoid spoilage.

Being deliberate about our spending does not mean we cannot spend or that we have no money.  Some of the wealthiest people I know live on budgets (Coincidence? I think not.).

Now, sometimes we will pass on an opportunity due to budget constraints.  We’re skipping a two day-trip out of town with friends, because we’re seeing them the week prior, and our vacation money this summer is spent. But we’re not poor.  Six days of vacation in a summer is more than we took even on our honeymoon, and we’ll do another week of vacation in the winter.

For those of you that haven’t tried it yet, being on a budget is not a symptom of poverty; It is the antidote and the preventative. There’s no need for pity, accommodation or gifts of frozen casserole. We’re doing great. We’re living like nobody else, so one day we can live like nobody else, just like Dave says.

Don’t pity your budgeting friends. Mimic them. Maybe there’s something to it. Just my two cents for today.

Frugal is the new black

We’ve seen if before. It will be the rage again, but right now, frugal is the new black. For once (perhaps the only time) in my life—I might be described as au couraunt (in fashion).

During the depression we saw people make-do without. A depression-era feedsack quilt graces my bed today. My thrifty ancestors couldn’t bring themselves to use the quilt until the others were totally worn out. Four generations later, it was given to me in brand-new condition and I was too frugal and broke to not use it. It’s been on my bed since college.

During World Ward II we saw reduced consumption and clever recycling. Ladies skipped the hosiery in favor of brush-on tan, and used eyeliner to pencil a “seam” onto their legs for these faux-stockings. They melted lipstick ends and cut them with petroleum jelly to make them last longer and refill tubes. Victory gardens grew in available plots, yards and former-flowerbeds.

Now more Americans are learning (and re-learning) to can and freeze surplus foods.

We’re repairing things (gasp!) and some are even ditching the maid and cleaning their own homes (shock and awe!).

Fashion is also seeing this frugal trend; in the form of more classic and practical pieces. Tartans, furs and durable fabrics are big for fall. Commercially-prepared food trends are also leaning towards frugality.

Blogs, magazines, and advertising are all touting “frugal” lifestyles, but I’m beginning to think many of these are missing the point of frugality.

Frugality means getting only what you need at the very lowest cost possible. Clipping coupons to buy Hamburger Helper isn’t frugal. Utilizing your “treat receipt” from Starbucks is similarly, not frugal. It’s nice, but not frugal.

Frugal is not buying the pot-scrubbers for your dishes and instead using onion bags or those little plastic tabs from bread bags. Frugal is shopping at thrift stores and consignment stores…when they have sales!

I’ve been looking into better frugal finds for certain things I don’t want to buy used (underwear and swimwear for example) and consumable items. I’ve found that liquidation stores like BigLots and Stupid Prices as well as local shops. Prices for their bras (of which they had a wide selection in my pre-teen daughter’s sizes) were about $1.50 to $3.00 each rather than the $16 we previously paid at stores like Wal Mart and Justice. Liquidators and dollar stores are especially good places to find consumable items like bubbles for the kids to play with, coloring books, crayons, school supplies, office supplies and cleaning products. Several times I’ve picked up printer paper for just a couple of dollars a ream because of a scratch or partial opening on the wrapper.

I’m running a month-long series of frugal tips on my blog at PennwiseFamily.blogspot.com to share information from frugal funerals to gleaning and co-ops if you’re interested in reading more on the subject of truly frugal living, not just frugal-fads. Another excellent (albeit rather outdated) resource is a book I just found at the library called “The Complete Tightwad Gazette” which is a collection of newsletters on frugal recipes which include some excellent ideas on saving money around your house, in your business, and in your kitchen. I’m warned though, it is the single-most-frequently stolen book from libraries—so if you can’t find it through your library, try a second-hand bookstore or the “used books” option on Amazon.com. If those don’t work, it’s worth paying full price for—and I seldom say that about a book.

My sanctuary

I have found over the last few years that the library has become quite a money saver and also a sanctuary for me. First off I love reading and second I love quiet. When I was going through my spending sprees I would purchase new books pretty frequently. I have since stopped buying new books and if there is a need for me to purchase one I try to get it used first.

The perks to having the card

It’s FREE! I am not sure about other communities but in my town we have one main library and then two smaller branches. There is an online database so that you can place the books or media items you find on hold. When you hold them you can pick which branch you would like to pick them up at. So if you are in a hurry there is no searching around for what you want. You just go to the hold racks locate you name code and get your items. It’s that simple.

The library is not just for books

The library’s inventory now has music, DVD’s and audio books. I work at Blockbuster and I get five free rentals per week so there is really no need for me to get DVD’s from the library but I do get CD’s. I did look at the DVD selection and there were a lot to choose from and it seemed as though they had all of the recently released movies too.

The savings

When I would buy books I was never picky if it was hardcover or paperback. Most hardcover books are about $25 while paperbacks are around $8. I usually read about two books a week. So if I read one hardcover and one paperback that’s a savings of $33 for just one week.

Of course there are cons

There are just a few cons to the library. They might not have the book or media that you want. I don’t really worry too much about this because I read for the joy of it so if they don’t have it I just move to the next thing on my list. The hold wait list might be fairly long. This can get frustrating because the time frame for books being checked out is three weeks. When I get done with my items I try to return them promptly.   If you tend to return things late there are fee too.

Best regards,
Maeghen

Anything that is not a recurring budget item is paid for with cash. We have a specific amount to spend each month on things like eating out, personal spending money, and groceries.  Each month we take that much money out of our account in cash and put it in envelopes to be used through the rest of the month.  When the envelope is empty it is empty and there is no more discretionary spending till the envelope gets refilled.

It works quite well for us.  Sometimes we have wanted to go out to dinner but it is the last week in the month and we are out of luck, but that is the whole point of a budget right?

Anyone else use a cash based budget system???

Foreclosures are soaring, bankruptcies are up….

I think I was ahead of the game. Ahead of the curve when it came to financial meltdowns.

Which is funny, because when money was flowing and home prices would “go up forever” (ala 2005), I was becoming broke faster than you can say “twitter”.

I think I just like to be different. When everyone is going left, I go right.

I’m glad I went through my short sale and bankruptcy when I did.

For all of my screw ups, I was pretty good at actually screwing up at the right time in my life. Sure, I wish I hadn’t ever lost all that money day trading, but   hitting rock bottom sure as hell woke me up.

And now I’m stable. I’m still in debt. Still owe Mom over a hundred grand, but she refuses to charge me interest, so it’s a manageable debt to continue to repay over time.

I just sent off another 2.5K to the IRS this week. I’m getting closer to wrapping that debt up. I’m re-doing my 2007 return with the help of my accountant and once that is done, all I’ll have left to owe is around 6 or 7K.

But back to the recession.

Bankruptcy, foreclosure, short sale, debt….these are becoming more and more common words every day in the press. And even in everyday conversation.

I for one am glad the bubble popped. I feel for those who have lost their jobs or their life savings. That sucks.

But I needed a wake up call, and I think we as a nation are grinding our way through our own wake up call.

What do you think?

Will the recession change our spending and savings habits in the long term? Is the new focus on frugality and saving just a fad? Will it pass if/when the boom returns?

But, we were watching HGTV last night (we’re addicted to ‘Property Virgins!), and there was a couple that was spending $1,000 a MONTH eating out. Yikes! We both judged them pretty harshly (we try not to judge in real life, but we figure judging people on TV is OK).

It made me think…well, I know we don’t spend 1K a month going out…but what do we spend?

So, I ran the numbers.

Here is our food budget for the last 5 full months, and since we began dating.

Food Budget Since We Started Dating

• Jan – $308
• Feb – $462
• March – $393
• April – $400
• May – $386

Average: $390/mo

Now, I pulled a few months from before we started dating….

My Bachelor Food Budget

• Oct (08) – $237
• Nov (08) – $176

Average: $206/mo

Here’s is the graph of the last 5 months from Mint.com, for all food categories.

Conclusions?

There are some pretty clear conclusions:

• Non-grocery food expenses have about doubled since I got a girlfriend
• I’m very happy they did : )

My girl always offer to pickup the tab whenever we eat out, and she does from time to time. And I really appreciate that. But I think she knows that I like feeling like a provider, and so she doesn’t press the issue much.

Overall, I think our food budget is within reason. I’ve actually started cooking more since we start dating than I ever did before (since I work from home, in a desk all day, it makes more sense this way vs. her work which is a bit more physically exhausting).