Saturday, February 7, 2009

February Update

March will mark one year that I've been really paying attention to our debt and working hard to get it paid off. Before March, I avoided it, because it was pretty depressing to see no progress at all. My wife graduated a few months later and started receiving full paychecks. I'm glad to report that as of writing this, we have paid off four of our seven credit cards, and the fifth will probably be paid off with the next paycheck. We still have a Mastercard and Discover card which are the big ones, but the debt snowball has been working and I think they'll be gone soon too.

A word on the debt payoff strategy...for my money, the debt snowball is the only way to go. I had my doubts, but once I started seeing zero balances, I got that much more excited.

So, now that the end is actually in sight (I haven't had zero credit card debt since college in the 90s), I have to start focusing on the rest of our debt. So, I added them to my debt snowball chart, and found that between our car loan (which will be the first to go once the credit cards are gone) and our student loans, we owe $266,500. This doesn't include our mortgage, because I don't to be too overwhelmed.

So, once our credit cards are no more and will never see another transaction, I plan to pay off the car, then my student loans, and then my wife's student loans.

With God's help, we can attack those and see them beaten also.

Friday, January 9, 2009

Spending Money to Save Money?

Let me give you a scenario...

Person A works for a employer who does not provide microwave ovens for its breakrooms and lunch areas. If an employee wants one, he/she has to bring it in and have it tagged and added to the equipment record that it is his/hers.

Now let's say that the microwave in the lunch room that Person A uses is really really old. In fact, it has one of those dials for setting time. It also is notorious for not cooking the middle of whatever is in it, effectively ruining lunch.

Person A is someone who wants to get out of debt. In fact he (or she) has a blog dedicated to his (or her) struggle to eliminate debt. However, the thought of using this microwave makes him (or her) shudder. Also, sandwiches have become really boring and he (or she) needs to have more variety. So, Person A eats out for lunch almost every day.

Do you think Person A should buy a new microwave to not only save money, but also to avoid the downward spiral that is his food intake?

Well, Person A is me (this is the big revelation of the story), and I already bought the microwave. It was $54 at Walmart. I figured that if I bring in leftovers every day, I'll save $54 in about 2 weeks. If I buy microwave dinners instead, then it gets stretched out a little more, but eventually I come out even.

Also, I can't actually use the microwave yet because it hasn't been approved for use. Ugh...bureaucracy.

Wednesday, January 7, 2009

Coupon Craziness!

PREFACE: Part of getting out of debt is spending less. Some people have made an artform out of using coupons to not only save money, but sometimes make money. Reference: http://www.thegrocerygame.com/

Well, my wife decided to subscribe to the local newspaper which usually means a pile of yellow bags stacked in our driveway waiting to be thrown out with the next week's trash. So, to make some use of the whole mess, I grabbed the Sunday paper and decided to clip coupons. What the woman in the above website does is: she compares her coupons to advertised sales for local stores. That way she not only gets the coupon savings, but also the store savings. Well, my wife works for Walgreens, so she gets 15% off of everything anyway. Add to that the fact that this week, Walgreens had sales on a lot of the items that also had coupons this week. So, we went to Walgreens with several piles of coupons and made out pretty well.

This first picture is from the receipt of our first transaction.
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The first line shows her employee discount. The second is regular savings from Walgreens. The third is from regular coupons. This also doesn't show the $10 we'll be getting back as a rebate. This is a grand total of $29.98 in savings. The grand total before the rebate...$23.46!
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This next receipt was the big purchase:
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Same lines as the first receipt, this time with no rebate. But, as you can see, we saved $146.12! The grand total for this order...$95.39! We saved more than we spent!
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My wife admitted it was actually fun so maybe she'll let me play again. And, the Walgreens person didn't hate us too terribly.

Sunday, January 4, 2009

Eric's Tip Tab

I don't know how many of you reading this have seen "Reservoir Dogs", but it gave me an idea. Before anyone runs out to rent it, let me say that you should NOT see it if you don't like strong language or violence. This movie epitomizes both.

With the morality and viewability of the movie put aside, there is an interesting scene in the beginning. Basically, the main characters are a bunch of criminals, previously unacquainted, who come together to do a job. Their first meeting is a breakfast together. At the end, the son of the mastermind pays for the meal, but tells everyone else to put in for the tip. One character, Mr. Pink (played by Steve Buscemi), does not. He says that he doesn't believe in tipping just because society tells us to. It is an interesting argument which can be found by searching for "Reservoir Dogs tipping". Once again, it is quite a cornucopia of obscene words and dirty phrases. Anyway, I don't agree that you shouldn't tip, but I do think that tipping should be based on merit rather than duty.

Another example of strange tipping practices was one performed by a college friend of mine. He would take astack of quarters with him when he would eat out. If the server did something wrong, like failing to refill a drink, he would take a quarter off of the stack. If the server did something well, he would add a quarter to the stack. Once again, I don't think this is the best way to figure out a tip, but it does bring up an interesting idea.

Today, my wife and I had sushi for lunch and I sort of mindlessly wrote in a tip. It was after this, that my brain started working. How can I know if my tip was correct or proper? Well, what if I developed a method to fairly decide what was deserved? So, I came up with my Tip Tab. It has different categories that will either add or subtract percentage points from the tip. I started with this website "How Much Should I Tip?"and used it as a baseline.

Well, here is my Tip Tab:


The blanks on the right are used to add or
subtract percentage points from the tip.
You can modify the numbers if you like,
but this is what I am starting with.







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Use these "additional" lines for any extras not listed above.

Take the total number, divide it by two and add the result to the 15% most people agree is the average tip.
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I made this the size of a dollar bill so it would fit in my wallet. I have it as a excel spreadsheet, so email me if you would like me to send it to you.

The reason that I am including this on a blog about getting rid of debt is that debt should not stop someone from being generous. I know that I often give less for a tip when I am feeling a pinch financially. I realize now that if I can afford to eat out, I can afford to tip someone who does a good job serving me.

I want to finish by saying that I have never been a waiter, but I know it is a very hard job. I greatly appreciate what they do, and if someone is ever really spectacular, I'll just give them a big tip. However, if someone is absolutely terrible, it would take a LOT for me to tip nothing. In fact, I can only remember one time that I did not leave some kind of tip, and I could go on and on about how terrible that service was.

This is me thinking out loud. Let me know if you agree, disagree, etc. Let me know if you think this idea has merit or if I am a total jerk for even suggesting it. I'm curious to see what others think.