February Wrap-up and March Goals

Monthly Wrap Up

Already we’re at the end of February, and I’m happy to report that I made up the gap from January and am ahead of schedule for my annual goal with a current savings of $1,082.86! That means that I put $968.86 into the emergency fund just in the month of February. Wow! A big chunk of that, over $550, was a reimbursement from overpaid health care, but I still was able to make $409 this month, before including payments for February’s mystery shops or refunds I’m waiting on. Not too shabby!

I’m still working on my Medi-Cal application, but the kids are covered while they’re evaluating our paperwork. I learned that our assets are too high to qualify us for Medi-Cal, but they don’t consider assets for kids, so they are covered. As you might imagine, our assets are not especially high, but you can’t have more than $3,000 in combined assets to get Medi-cal, and a small 401(k) from a previous employer, the average balance on our regular checking account (which is down to next to nothing by the end of the month), and this growing emergency fund push us over that amount. We will likely be using the San Mateo ACE program once all the paperwork goes through, which has an $8,000 asset limit.

Having the full $6,000 in an emergency fund will likely put us over the asset limit for ACE. Since our income doesn’t give us the flexibility to pay out of pocket for health care, I’ll need to readjust our savings plan at some point this year so that we continue to qualify for the county plan. I’m sticking my head in the sand on that until I come to it, though. I’m not willing to liquidate the meager 401(k) and pay the penalties so that we have a full emergency fund.

I’m not sure I made my 21 no-spend days goal, but if I don’t include mystery shops (which I consider work, as I’m being paid and reimbursed for whatever I spend out of pocket) I’m pretty close. I’m going to keep the goal of 21 days in March, again not including food, gas, regular bills, or mystery shops.

I’m expecting $453.00 for mystery shops (including reimbursements), $32.00 from mail in rebates, $11.29 from Ebates and $26.50 from Surveyhead (that’s taking awhile!). I’ve done more surveys but haven’t cashed out yet.

Once I get the payments for mystery shops, I will have gotten for free in February: a brake check, oil check, children’s clothes, paint, beauty supplies, a night of bowling, several meals, an eye exam (which I really needed!), and a house plant.

In February, I also did a MAJOR declutter of the dining room, painted (with paint from a mystery shop), and it is a clean, livable, and in my opinion, beautiful space now. Come back Monday for the after pictures!

Goals for March

1. Stick to a zero-based, envelope budget, using only cash.

2. Call to negotiate the price on more of our services – cell phone, car insurance, etc. Watch for a few more Dialing for Dollars articles in March!

3. Save or earn $449.14 to stay on track for my annual goals.

4. Finish paperwork on Medi-Cal, college for the fall, and preschool for Peanut.

5. All meals at home except for mystery shops. (This is still a tough one for me!)

6. Attack the closets with decluttering fury! I’m feeling so good about the dining room and want to bring the rest of the house up to its standards. This month, the focus is on our four small closets and a wall of cabinets in the living room – all of our personal storage space.

7. No-Spend days – 21; No-Drive days – 14

March Budget
Income – $1,700 (I did some work this month for the family business and will make about $200)

Expenses
(We get food stamps, so food is not accounted for in our budget.)
Savings – $100
Rent and utilities – $1,000
Car payment – $200
Gas – $70
Household expenses – $49 (toilet paper, dish soap, diapers, etc.)
Mystery shops (will be reimbursed) – $100
Irregular Expenses – $181

How I came to the amount of irregular expenses:
Renter’s Insurance – $230
Car Insurance – $700
Smog Check, Car registration – $160
Clothes and shoes – $600
Household items – $480

Annual total: $2170
/12 =   $181/month

We don’t pay for utilities out of pocket; they’re included in our rent, explained here. On months that I don’t work, I don’t put away as much for irregular expenses, use less in gas or household expenses, reserve money that would go to the emergency fund, or pull from it for things we need (such as chairs this month, and my ticket and traffic school last month.)

I was asked about preschool: my son was isn’t currently in school. He was in preschool before our cut in income, at which time I had to pull him as I couldn’t continue to pay the $300 a month. He was in a Head Start program for the first semester of this school year but it was a poor fit for him for reasons I will not discuss here. I have found a subsidized program at another local preschool and am working on getting him in there now. It would be really wonderful for our family, as they’ll also take both kids full time in the fall while I go to school. Think happy preschool thoughts for us that this will work for us!

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January Wrap-Up, February Goals

Monthly Wrap Up

January is coming swiftly to a close and I’m ahead for the month with $114.00 in the emergency fund. It’s not the $500 I was hoping to have reached, and I’m a little anxious about this shaky start!

I did, however, start my IDA, actively pursue more options for bringing in money, turn my $10 donation into $100 for Haitian relief efforts, and took the plunge and dropped our health insurance for Medi-Cal (still in progress – this is not a fast process!)  I also had the money on hand to pay for my little set back without incurring debt, so it’s not all bad. I got my credit report and am ready to write letters to make corrections. It was a busy month!

I also far exceeded my goal of 7 no-spend days. I’m pushing myself with a goal of 21 no-spend days in February (mystery shops, gas, groceries, and routine bills excluded.)

I am currently expecting $115.14 for mystery shops (including reimbursements), $17 for rebates, $11.29 from E-bates, $10.00 from Swagbucks, and $26.50 for online surveys at Surveyhead. I am also waiting on $77 back from a bank error.

Goals for February

1. Stick to a zero-based, cash only budget.

2. Call to negotiate the price on all of our services – phone, internet, cell phone, car insurance, etc. Watch for lots of Dialing for Dollars articles in February!

3. Save or earn $886 to get back on track for my annual goals.

4. Finish paperwork on Medi-Cal and college for the fall.

5. All meals at home except for our anniversary dinner, with a gift certificate. (We’re celebrating ten years as a couple at the end of the month!)

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I Love IDA!

IDA, or Individual Development Account, is going to be my new savings vehicle, and a truly wonderful one at that. What is an IDA?

Individual Development Accounts (IDAs) are matched savings accounts that enable low-income American families to save, build assets, and enter the financial mainstream. IDAs reward the monthly savings of working-poor families who are trying to buy their first home, pay for post-secondary education, or start a small business.

For every $1 I save, I can earn $2 in matched funds. I can save up to $2000 of my own funds and earn up to $4,000 in matched funds, giving me $6,000 to use toward college. Is that awesome or what?

I’ve wanted to go back to college to finish my Bachelor’s degree, but with two small kids and quite little income, it didn’t seem to be within reach. In comes IDA, to the rescue! Between that and the Pell Grant, I should be able to cover my tuition and books for the two years of schooling that I have left without needing to take out student loans. If I take classes when Peanut is in kindergarten, I’ll only need to find childcare for Sweet Pea, who will be old enough to attend the university’s childcare program.

I’ll be saving $2,000 of my $6,000 goal in my IDA, through Opportunity Fund in San Jose, and starting in the fall toward a BS in Business Management.  I’m in the application process and will be taking a financial management course as part of the program; I’ll be sure to post what I learn.

I discovered IDA on the blog Consciously Frugal, and I can’t tell you how grateful I am to have found it.

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Getting Cozy with my Credit Report

As I mentioned in the initial post on this blog, I’ve been living off the credit map for several years. We have no mortgage and rent from a private party, so those aren’t listed. I have no credit cards. Until buying a new-to-us car in November, I had no debt at all; the car will be paid in full by the end of this year.

The only thing that appears on my credit report is a credit card charge-off from 2002, for a store that has since gone bankrupt. Needless to say, there is a great gaping void where a good credit score should be!

One of my goals for 2010 is to bring my score up to at least 700. I have been tooling around the web to find the best way to do this and came upon this post by The Digerati Life on how to improve your credit score. Very informative!

My first step was ordering my credit report and correcting errors. I was surprised to find errors on mine, given its relative lack of use! I also signed up with Credit Karma to monitor my credit score for free. As part of my financial management plan, I’ll be checking in on it monthly to see how my goals are progressing.

Next up, I’m getting a secured credit card through my credit union so my credit report can start showing something positive! According to the Bankrate.com article, a secured card requires a cash collateral deposit that becomes the credit line for that account. For example, if you put $500 in the account, you can charge up to $500.

For my purposes, I’ll be using the card to pay my car payment, and ONLY the car payment, each month. The card will be paid off immediately after making the car payment so there will never be a balance on which to pay interest, and it will live in my financial records, not my wallet, so I’m not tempted to use it for other purchases. The extra step in paying the car payment should reflect twice on my credit report each month for the on-time payments of the car loan and card.

Getting cozy with my credit report will help me to establish a positive credit score. Getting cozy with YOUR credit report may show you that your credit is better than expected, that your occasional late payments have had more of a hit than anticipated, or that someone was tampering with your identity. The only way to find out is to look, and you can do it for free.

To see what works for other families, check out Works for Me Wednesday on We Are That Family.

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I’ve updated the Goals and Progress page to reflect another addition to the savings fund! I babysat yesterday, bringing in another $30 and bringing the savings up to $243.01.

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Welcome to The Saved Quarter

Welcome to The Saved Quarter. I’m writing this blog to document my journey from financial insecurity to financial independence and hope that you’ll join me.

You’ve likely heard the phrase penny wise, pound foolish used to describe a person who minds the small change without regard for the bigger picture. Unfortunately, this is where I have been thus far, and the fact that I’m not in uncontrollable debt is sheer luck. My husband and I live paycheck to paycheck, with no significant savings and no back up plan. It’s no way to live, and definitely not the way we want our children to handle their money as they grow. I am ready to take control and be both penny and pound wise.

Why “The Saved Quarter?”

Besides the obvious image of a change jar full of shiny coins, which can quickly demonstrate how small change adds up, The Saved Quarter offers a quick synopsis of my goal for 2010, and for this blog:

Save 3 months’ expenses (a quarter of the year),
or $6,000 (a quarter of our annual income.)

Of the eleven dictionary definitions of the word “save,” eight had clear connections to and help define my project.

Save
-verb, (used with object)

1. to rescue from danger or possible harm, injury, or loss

Because I am off the credit grid, so to speak, with no credit cards, mortgage, or job, and until November 2009 had only a years old single charge-off of a store credit card to reflect my credit-worthiness, my credit score is abysmal. I’m putting in the effort to rescue it now, with the goal of a score of 700 by December, 2010.

2. to keep safe, intact, or unhurt; safeguard; preserve

Our fledgling emergency fund is going into an interest-bearing, FDIC insured account that is easier for me to deposit into than withdraw out of, safeguarding it from that which would destroy it faster than Wall Street: myself.

3. to keep from being lost

Avoiding bank overdraft fees, which have been eating up a ridiculous amount of our modest income, and interest charges.

4. to avoid the spending, consumption, or waste of

I’ll be avoiding recreational shopping and making purchases only when they are needed, spending mindfully, with an effort toward lowering my family’s overall level of personal consumption, using our spending to support our values by purchasing durable products instead of those that are disposable, and creating less waste.

5. to keep, as for reuse;  and  6. to set aside, reserve, or lay by

We’ll be paying our savings first rather than saving just what is leftover at the end of the month, which frequently ends up being nothing.

7. to treat carefully in order to reduce wear

Avoid paying full price on items we’ve mindfully chosen to buy by shopping second-hand, using sales, coupons, and rebates to stretch every penny.

8. to prevent the occurrence, use, or necessity of

Find ways to meet our needs that do not cost money, such as free events, bartering and trading, and borrowing before buying new.

(I couldn’t connect my goals to the last three definitions, but if you see a connection please leave it in the comments!

9. Theology. to deliver from the power and consequences of sin.

10. Computers. to copy (a file) from RAM onto a disk or other storage medium.

11. Sports. to stop (a ball or puck) from entering one’s goal.)

So 2010 is to be a year of great saving in just about every sense of the word for me and my family! We’ll be saving our quarters – the shiny coins and the dollars they add up to; 1/4 of our income for the unexpected; and our home and household from the discord that comes from poor money management.

At the same time, I am trying to consume more responsibly and make more sustainable choices, both environmentally and on my personal budget sheet. I want to have a life with more joy and less stuff.

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