Our kids have both started with their chosen spring sport, T-ball, and soccer. This means that once, sometimes twice a week we’re picking up kids from school, eating on the go, and dashing off to a practice/game. Every Saturday has a game for each kid.

After a long lazy winter of hunkering down inside where it’s nice and warm, it’s nice to get out in some nice weather, but at the same time it feels very hectic and madcap, always on the go! Last weekend I didn’t even plan out an official menu for this current week’s dinners, as with 2 evenings taken up with sports and another night where my husband had a class and therefore wouldn’t be home, there was really only 2 weeknights to plan for.

Our kids get up about 7am and we’re usually out the door at around 8ish to drop them at school (we take turns dropping off and picking up). Pick up from school/daycare is usually around 5-5:30. It’s about 15min from their school to our home, and soccer practice starts at 6:30, and weekday t-ball games start at 6. Not a lot of time in there to get from school to home to eat to get on shinguards/cleats/etc back out and to the field. And then after the practice/game, there’s not a lot of time to play, as bedtime is 8pm. We usually start their bedtime at about 7:15 and we aim for kids to be bathed, jammied up, read to and tucked in/lights off by 8pm. You can see how this doesn’t leave a whole lot of time for … well, anything!

As a result, we’ve been eating way too much fast food and the kids have been getting to bed a bit later on some days. The crunched down schedule has been taking it’s toll, not the least of which is in the form of a parent trying to hurry up a kid and being crabby about it. It’s not all bad though, last night was a class night for Mr. 99k, so I was on kid duty by myself for the evening. I left work late and thus picked the kids up late, which means there’s even less time for a real sit down dinner (even if it’s usually just chicken nuggets and tater tots, which I usually let them have on a class night). So instead of trying to hurry home and fix dinner and having no play time for the kids, I stopped at McDonalds and tried to get them to hold still long enough to get some nuggets into their tummies, then cried out, “RELEASE THE HOUNDS!” (ala the simpsons) and let them run rampant on the play equipment for a half hour. They are even learning the concepts of time budgeting, as I had to explain to them, “If we spend our time playing in the play area, that means there’s not much time to play when we get home.”

It’s definitely hard to spend quality time with your kids when there’s not enough time in the evenings to get everything in. We’ve been toying with the idea of a slightly later bedtime for the kids which *would* give us some more time. I think our older one (soon to be 6) would be fine with that, but the 4 year old could probably still use the full 11 hours of sleep. Neither one naps anymore (alas!) and when we come into their room at 7am, they’re both still usually asleep (Ms. 4 year old) or just waking up (Mr. 6yo) - a good sign that it’s not TOO much sleep.

We are going to try to do better about the fast food for the rest of the month, and have solemnly sworn that any more eating out would come out of our personal blow money categories rather than keep overspending the family eating out category.

It’s interesting to look at how time constraints and time budgeting can actually affect the fiscal budget.

Well, there’s no need to get an energy audit, for we now know the reason for the huge power bill.

We had a few very warm days last week, and even though I was already looking around for an HVAC service company, the “looking around” became more urgent as we realized our upstairs heatpump was not pumping the heat out.

I found a local company and the new HVAC guy came out Sunday and after poking around, gave us the bad news. The compressor is shot. Not only is it shot, but the entire unit is pretty cheap and crappy. He suggested that instead of sinking $1500-2000 bucks into it, we look into getting a new unit.

Unfortunately this was not news. We had someone come out in the fall* because of some problems with the heating upstairs, and I now remember (hindsight - ain’t it grand?) something being said about the compressor. I also remember they said roughly the same thing. That our unit was the cheapest piece of crap that our builder could get away with using and we’d spend our dollars better by matching them with some friends and springing for a whole new unit.

(*We didn’t call that same company again becuase a) I couldn’t remember what company it was and b) they had double charged us in the past which kind of pissed me off and finally c) the techs were always really confusing and hard to understand.)

However, after they left, our heat mysteriously started working again, and we dismissed the entire visit from our minds and went on our merry way.

Until this past Sunday.

After the new HVAC guy gave us the bad news, I asked him if anything would work.

“Cooling is a no. Heating?” I asked.
“Emergency heat only,” he replied.

Emergency heat. This is where the little lightbulb went off over my head.

“Emergency heat. That would probably suck a lot of power, wouldn’t it?” I asked.
“Why yes, yes it would,” he answered.

(Ding, ding, ding! We have a winner! Ed McMahan, tell 99k what she has won! Why, she’s won power bills from over the winter that were way way way too high, just what she’s always wanted!)

New HVAC Guy would not do any warranty work on this brand of unit, because this manufacturer is apparently really crappy to work with for warranties, and he was only a one man operation and didn’t want to spend his time driving down to The Sticks, VA to deal with them.

Long story short, after flirting with the possibility of replacing the unit, getting estimates etc. and learning that it would have to be both the outside AND the inside blower unit, and all that would run about $6-7k, we found a good, local HVAC service company that can fix the compressor under warranty (which will still cost us about $1200 for labor and freon) and we’ll also be doing maintenance agreements for both our upstairs and downstairs units with them, which includes niceties as spring and fall visits. I only feel bad about leaving the very nice New HVAC Guy, who even told us he wouldn’t charge us his diagnostic fee because he wouldn’t do it under warranty.

I’m not sure exactly what the hit will be to our emergency fund, but I’m hopeful it won’t be much. It has not been a stellar month so far, we have gone over budget in a couple categories (and they’re all “fun money” categories, whoopsies, what can I say, it was a birthday month). I also haven’t made the bulk of our credit card snowball payments yet (minimums are all paid), so I have some budget tweaking ahead of me.

Obviously, I can use money that was ear marked for debt for the HVAC issues, as the debt snowball would have to be halted until the emergency fund was replaced anyway, so whether it comes from debt money or emergency money is kind of like pah-tay-toe and puh-tah-toe. We did have some money in a “home maintenance” category as well, but not $1200 worth. I may also relook at our “tuition” category and see if my husband knows if any of the summer or fall classes he will be taking will qualify for tuition reimbursement. I planned for both of them to NOT be eligible, so if a few of them are, then I may be able to pull some of what’s built up in that category. All in all, I’m hoping that we won’t have to pull out more than $500 from our e*trade account. Even so, April is not going to be a stellar month in terms of debt repayment.

But you know what? After looking at numbers ranging from $6,000 to $7,000 for entire new units? $1200 sounds like a dream come true!

And that damn mystery power bill is now SOLVED and soon to be RESOLVED!

-99k

We got our electric bill a week and a half ago, and it is down another $100, which makes me breathe a huge sigh of relief.

However, it begs the question - why? We haven’t done anything differently in March, except not run the heat as much with the weather getting warmer.

I talked with my dad a month or so ago, and being the engineer that he is, he was running some numbers for me, “Well, say your heat fan uses X watts and you run it 70% of the time, you still wouldn’t be generating that much wattage..” etc.

Meaning, if our Kilowatt usage is this far down just because the heat hasn’t been running as much, maybe something is wrong with our furnace. My folks have a much bigger house than ours (probably double our sq footage) and also live in a much colder climate, and yet we have been using more power than they do.

We’ve generally ignored any flyers that came our way touting yearly heating/cooling system check ups, as this is a new home (4 years now), but maybe it’s time to look into something like this.

I’ve been wondering about something like this, and so took an informal poll of 3 of my co-workers. 2 did not do anything like this, and 1 did. I also asked how often they changed their air filters. One said, “A lot, at least once every 3 months,” while the other two said, “probably not often enough,” & “whenever I remember to.”

What about you? Do you have yearly system checkups? And how often do you change your filters?

-99k

GOAL ACHIEVED: NO MORE CREDIT CARD INTEREST

So when we last left our heroine, there was much dithering and swooning over whether or not to stick the heft of the credit card payments into high yield savings while only paying the minimums on the cards themselves. Then the point quickly became moot, since our heroine noticed a hefty non-capped 3% balance transfer fee, and the whole idea was dropped.

(Let’s just drop the third person now, shall we, because I SO can’t carry that off through the whole post.) When I noticed the fee, I went scouring the internet for any 0% no fee balance transfer offers, and came up with a ONE very lonely offer. Every other offer either had the $75 min BT fee, or was not for 12 months - it’s amazing really, as I can remember when we were shredding tons of these offers not so long ago. So after some scouring, I found the Citi Professional card with 0% and no fees for the first 12 months. I went ahead and applied, and promptly forgot about it until I received my shiny new card in the mail with a limit of $15,000 about a week ago.

I promptly put in a balance transfer for our remaining usaa mastercard, and am currently waiting for that to go through (any day now).

When it does, all our credit card debt will be at 0%. Here’s the breakdown, in order of which 0% rate expires first:

citi home rebate mc: $7,278
rate adjusts 12/08

discover: $6,355
rate adjusts 3/09

citi professional mc: 13,230
rate adjusts 4/09

We will be able to pay off each one of these cards before they adjust. I’m very excited to not be paying any more credit card interest!

A few remaining questions we’re going to readdress sometime:

Should we start closing cards as they are paid off?

We have 2 cards that are at a 0 balance now, USAA mastercard, and Citibank American Express. We are not going to close our USAA mc, as it has always been our primary card, has the highest credit limit, and has the longest history. The AMEX however, was opened one year ago? two years ago? (I can’t remember, I probably should check) and I don’t really see us using it ever again. For now, we’re leaving it open, as apart from the usaa card, it’s the card with the next longest history. We don’t even have cards to it, so there’s no danger of a balance running up. The other cards we have open (citi home rebate, citi professional, discover) have even shorter histories and are also questionable on whether we should keep them open or not.

I’m not sure we should even worry about hurting our FICO score. The fact is, we just refinanced our home in February and are not planning on moving for some time, we purchased my husband’s car last year and my car won’t need replacing for a few more years at least (knock on wood) - and when we do replace it, hopefully we will save up and do it with cash. I don’t see any future loans happening in our future, and if that’s the case, who cares if our credit score goes down a bit? As we pay down more cards, then the debt to credit limit ratio would get better and better, even if we hack the total credit limit down by closing a card or two.

All good points to deliberate on.. guess we will see.

Should we go back to the “sock the extra debt money into HY savings” plan?

I am thinking yes. But I have no problem letting things settle down first. We’re smack dab in the middle of birthday season (just our household, 2 over and 2 more to go) and we started the kids’ sports season (evening practices, saturday games) which means I don’t have as much time to loll around in the evenings poring over spreadsheets. I’m content to let the balance transfer go through and revisit this then.

And finally, should we start using our rewards card?

RL has piqued my interest in her comments about their month-to-month spending using a HY checking, putting expenses on a good rewards credit card during the month so the checking balance builds up and earns interest, and then of course paying it off in full each month.

We’ve already decided to start using our USAA rewards card (pretty much 1% cash back) but the HY checking account idea sounds good as well. (Charles Schwab offers a good one, although it’s down to 2.26% interest now.) Not sure we’re ready to change checking accounts, but it is on the table for discussion.

Well that’s it for now.

Any comments on the move and new design would be welcome!
(Yes, I’m vain and am wondering if anyone is out there.)

-99k

Hello all, and welcome to the new location. I was getting tired of the limitations of the free blog on the YNAB site, and decided to dive in and register a real domain. Somehow, it makes it all seem more real, don’t you think?

So, let’s get right to the March numbers, shall we? March was a very good month for us!

JUST THE CREDIT CARDS, PLEASE:

In March:
we paid $3,680 on our cards,
$145 was charged in finance charges,

for a total of $3,535 debt paydown.

Our new credit card debt total is $26,818.

(WOO TO THE HOO!)

THE ENTIRE PICTURE:

* Includes a $75 balance transfer fee.

For a month by month picture of our progress, see the Monthly Totals page.

We are now at a total of $92.4K. Next month, we should just stick our noses under the 80k mark.

Feelin’ pretty good over here!

-99k

Let me just start this off by saying, I still love you, YNAB. I do.

So why do I feel so GUILTY???

Because I installed quicken.

DON’T LEAVE ME YNAB! I PROMISE I WAS THINKING OF YOU THE WHOLE TIME! *sniff*

OK, let me back up.

We are not operating on a buffer yet. For those of you who do not know, Rule #1 of the YNAB methodology is to live on LAST month’s income. It is ingenius, really. If you’re living on the last month’s income, then you’re not touching this month’s income as it gets deposited and there’s never any fear of anything bouncing or being out of whack. No waiting until paydate X to pay bill Y, etc.

when you are living on last month’s income, this extra padding of money in your spending account is called the “buffer,” because it buffers you from that $0 balance.

Now, we are not living on last month’s income yet, and honestly, at least until we pay off our credit card debt, I don’t see this happening. We have the opportunity to build up to it, but at this point, I’d rather put everything we can towards debt, even if that means we don’t have a buffer. I think after the credit cards are gone next march, we may take a month and do it, but right now - no buffer. And also, our paydates are spaced pretty well so that for the most part, there usually isn’t any intense juggling going on, mostly, I just have to be careful about the beginning of the month when a lot of things are due/paid.

So I sat down today to enter in the last few days worth of transactions into YNAB and just check up on finance things in general, when I realized I made a mistake.

In YNAB, it’s easy to forget about your running checking account balance, because the only balance for the account is up in the tab for the account that you’re in, rather than a running balance in the actual register. Our mortgage payment is going to be high next month because we just refinanced and instead of prepaying the interest that would be accrued up to our first payment, that interest is due in our first payment.

So, I was going to time things carefully and wait until after my husband’s paycheck hits the checking account (on the 3rd) and then send the mortgage payment. However, I had already entered the mortgage payment into my bank’s online bill pay for 4/1, and unfortunately, it is now “processing” which means I can’t modify the date on it. Doh.

So I kind of scrambled a bit, not totally sure whether the plethora of things coming due at the beginning of the month would interfere with the mortgage payment going through. Even when I enter things ahead of time into my checking register in YNAB, without a running balance, it’s hard to see how things are going to play out.

So I installed quicken, I am sorry to say. I still love you YNAB, but there are some things that quicken just does better. And when I was entering all my past transactions and carefully cross-checking with YNAB to get it in the right category — I found a few errors that I had made in YNAB. One transaction I had never entered, and another I had entered twice.

So I guess now, I am going to be a dual software user - both quicken and YNAB. On a whim, I checked out the budgeting screen in quicken, and was quickly underwhelmed. YNAB does awesome budgeting, hands down. Now if it only would download transactions automatically, reconcile, and show a running balance, I will go back to being faithful to YNAB, and YNAB only.

Until then… I have to sneak out and meet my dark quicken lover in the dead of night, in seedy motels, and quickly shower afterward to get rid of my shame…

*Ahem* Sorry, got a little off track there :)

I still love you YNAB.

ps - no quick transfers from e*trade account necessary, looks like the mini buffer in our checking account from our savings categories, as well as category overages are enough to keep us from going in the red until some paychecks hit.

Thank you for the comments on the last couple posts.

We were all set to go forward with our plan, when I noticed something (thank goodness). The offer on the citibank mc had NO CAP on the balance transfer fee. So if we had gone ahead and transfered $15k, the fee would have been $450. NO THANK YOU. We called, and the best they could offer was to credit our account half the fee, after the transfer had gone through. I don’t want to do it at $225, either, so this is a no go. We have already transfered a chunk of our debt to a 0% discover card, and we’re calling that good for now. We may look into this further in the future. So for now, we will continue paying straight onto our last card not at 0%, which is our usaa mc at about ~10%, for 13k (put the bonus money onto it already).

The numbers are looking VERY good for march, I’m happy to say. I am still waiting for our usaa mc statement so I can see the interest charges for it and finalize my spreadsheet for March. I’m so excited that we paid $3,830 toward credit card debt in March - yeah to the hoo to the yeah-hoo-hoo!

You see before you… (well, you’re reading on your screen, at least..) a lady most informed on the calculations of interest. You’d think that this would be easy to find, but Google wanted to point me to lots of calculators that would do it for me (but only based on a year) but nothing that would tell me HOW to figure it out myself.. But I finally found this very easy to read and understand tutorial of sorts. I highly recommend it.

So using my newfound knowledge, I set to work. I decided to run numbers just based on the 16k balance that will be on our citi amex card, which the 0% rate expires in October. The goal is to get it paid off by October. However, the balance won’t be 16k in April, it will be $13,250k, due to a big payment courtesy of my husband’s bonus.

Behold, the “just pay it down already!” scenario A:

So you know where those bigger numbers are coming from, $1300 is going to come from the regular debt snowball.

We will be receiving $1k back from our state taxes, and my husband gets an extra paycheck in april, so April’s numbers are 1300 + 1000+ 1800 = $4100.

In May, we’re expecting the tax stimulus check: 1300 + 1600 = $2900.

The rest of the months are “normal”.


Next, scenario B, let’s call it the, “Stuff it into savings instead” scenario:

Obviously, we will need to pay the minimum on the card, which I am going to say is $250. Now that I think about it, that’s probably high, but oh well. You can see the running balance for the card on the right, in yellow.

On the left in green, you can see the savings account. Each month, the month that would have gone to debt (minus $250), is instead put into savings. The bright green column is the interest earned for that month, with a tally of all the interest earned at the very bottom of that column ($189). The middle column is the running balance, adding the deposit as well as the interest from the previous month.

So when October comes, instead of making a deposit into the savings account, there will instead be a withdrawal of $10,700, and then that money, paired with the same $1050 debt payment we see in scenario A, is enough to pay off the amex balance in it’s entirety.

And the result? Instead of the 2k we started out with, we have $2189 - $189 in interest. Which we could then use to pay off our other debt.

THE RESULTS:
I’m nervous about my numbers. I calculated the interest using this formula:

.035 (our interest rate) x balance x 31/365 (a month’s worth of a year’s interest)

So if you take the initial $2000, it works out like this:

.035 x 2000 x .0849 = 5.94, or as my google doc spreadsheet rounded it off, $6.

If anyone wants to check and/or correct me, feel free (all THREE of my readers, haha!)

If the numbers are somewhat accurate… I am a little surprised. A benefit of almost $200 bucks in only 7 months is nothing to sniff at, in my opinion. This is looking like a decent scenario! Which makes me think I must have screwed something up somewhere! If I am … in the ballpark of accurate, then perhaps we shouldn’t even put the $2.5K from the bonus towards the debt this month - I could stuff it back into savings and transfer over a 16k balance to the 0% card instead of 13ishk and reap even better interest benefits.

This is definitely something to mull over. I’d welcome any thoughts and comments.

Look at me, I’m a blog-posting poster person. Two in one day!

So, when I was persuing the whole “I don’t wanna pay interest!” thing, another idea kind of poked it’s way into my mind that I shoved onto the back burner, at least until all the balance shuffling has stopped. I brought it up my husband, who agreed to do it, and then I immediately changed my mind and said we shouldn’t do it. I am nothing if not fickle. So here I am, writing it all out to you people, because you know, the internet always gives good advice!

RL (who comments here now and then, hi RL!) sent in her debt situation to Free Money Finance, who posted it on the blog and asked his readers for suggestions. There were a lot of suggestions- A LOT! It’s kind of interesting to see how many different possible scenarios there are for a situation! It was one of the many suggestions for her that has been tinkering around in my noggin. (I posted my thoughts over there too, just FYI.)

Here is the specific comment that has been “festering“, but so you don’t have to clicking around, the jist of it is, put the debt snowball into a high interest savings account while only paying the minimums on the (0%) cards. So the cards are staying current, but the balances are not going down drastically. Instead, the money that WOULD be going to the cards is sitting and earning interest month after month, and then whisked out before the 0% rate expires on the card and is used to pay it off.

In theory, it seems like a good plan. If debt A, B & C is at 0% interest, why not take the money you would be paying on them and earn 4% (although our etrade is now down to 3.5%, grr) and then lump sum it at the end of the 0% period?

Now, first off… I have only a very general idea of how savings interest is calculated. I understand the basics of daily compound interest and the whole average daily balance business, but I am not sure if my simple understanding really allows me to work through the numbers in an accurate fashion.

Secondly, the payoff dates we’re talking here is not far away. $16k will be due in Oct, and it’s not like we have 16k just sitting around now, that could earn interest the entire time.

And third, there is the feeling you get when you see that balance go down down down each month. This is outside of the numbers and not really quantifiable, it just feels AWESOME. The equation I would have to work in my head is whether X amount in interest earned is really worth giving up that feeling of watching the debt go down. I am pretty geeky with my spreadsheets and looking to cut out paying interest finance charges and getting the numbers to work in the best possible manner… but I’m not sure I’m geeky enough to give up that “YES!” feeling when I make a payment. Especially if we’re talking piddly numbers here.

But you never know until you work the numbers, so, I’m going to have a go at it, and lordie lordie help me because I know this will probably be screwed up big-time!

Tomorrow: the number crunching results.

We recently sat down and looked at all the interest we’re paying on credit card debt and tried to figure out how we could cut it down.

First, we called the 2 cards that have an interest rate (the 3rd of our cards is already at 0%) to see if they could lower the rate. They both would not - although, both pointed out that the rate for this month would be lower, since the prime rate had dropped. They were correct, each fell a bit, so that the 2 cards are at 11% and 10%, but we still weren’t happy with this.

So I looked around for any 0% balance transfer offers, found one for discover, and applied. We were approved, and the $6.5 balance on our citi amex (previously at 11%) has now been moved over to this new discover card. The discover card 0% rate is good until next april. Now with the citi amex card balance at 0, we can move our $16k usaa mc balance over to citi amex, using their 0% balance transfer offer which will be good until this October.

A couple of thoughts about all this swapping around.

First off, I realize that some people are not keen on the 0% balance swapping. That’s fine, stick with your beliefs, whatever you feel is right. I don’t like paying interest, period. If I can find a way to NOT pay interest, I’m going to use it! Now, having said that, it is true that in the past, we have transfered a balance over to a new 0% card, and then run up the balance on the old card. Not good. THIS is the practice that one should not be keen on - with good reason. It got us into this mess! We are on a plan now, and there will be no more debt racking up!

Next: Credit cards are tricksy. They like to play favorites with the balances. Take the citi amex. We had a balance of 6.5k on there at about 11%, with a credit limit of $20k. They have offered us additional 0% balance transfers. Sounds great, right? that’s 14k of unused credit we could be using at 0%. Perfect!

Not so fast! If we had transferred a balance while we had a balance NOT at 0% (the $6.5k was at around 11%) — then every payment we sent in would automatically go toward the 0% balance, and NONE toward the 11% balance. That would mean that the $6.5k balance at 11% would NOT GET PAID DOWN AT ALL, until the 14k at 0% balance was GONE. That would be a lot of months, with a LOT of interest each month, which is the entire reason we’re doing all this swapperoo-ing — to AVOID INTEREST. No thank you, Citibank, get another shmuck to fall for it.

So, we are now currently WAITING. The $6.5k balance has been transferred, and I’ve even sent in about $60 so that the balance on the card is a CREDIT of around $60 (I’m anticipating the finance charge). I am waiting until after the next statement to instigate the next balance transfer, just to make SURE that there will be NO BALANCE that may incur finance charges during the time we have a 0% balance as well. In the meantime, I’ve switched our main debt snowball payments from the $6.5k balance on the citi amex (that is now on the discover card) to the $16k balance on the usaa mc, which will be moving over to the citi amex. Pay down the one with the interest charges first, is my philosophy.

Finally: the $16K balance will only have a 0% interest rate until OCTOBER. That is REALLY pushing it. Hopefully we can get that paid down before it reverts back to an interest rate, but even if we don’t quite make it, we will still have saved a bundle on interest. It seems like an awful lot to pay off by October, until we do a few calculations.

Some artillery in our arsenal:

• one month (i think it’s May) we’ll have 3 paychecks from my husband instead of the usual 2, he gets paid bi-weekly
• we’re expecting $1k back from our state taxes, and
• of course can we all say together, TAX STIMULUS! That’s another $1600 that will be going toward debt

So along with our usual debt snowball, we’ll have an additional $4400 going to debt between now and October (and that’s not counting the $2.5K from the bonus that’s heading over to debt this month!) It may be crazy, but my goal is to get that 16k GONE by october! Let’s run some numbers to see if it’s doable:

Seven months between March and October to pay off $9100:

$9100 / 7 months = $1300 a month.

That is doable, baby. Very doable. We may have to crank it up a notch, but we can do it!

So the moral to this post is: Credit card companies are tricksy, we must watches them, yes we must!!