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Complainers

I DON'T EVEN KNOW WHAT WE'RE YELLING ABOUT

A few weeks ago, Yahoo Finance ran an article on Mr. and Mrs. 1500, detailing how they retired early after setting a goal of doing so in just 1500 days. Yahoo screwed the pooch with the title, “How one couple saved $1 million in 4 years to retire by age 43,” implying that they raised the full million for retirement in those 1500 days, when in reality there were 17 years of hard work and flipping houses before that.

As you might predict, the comments were basically a shitshow. People went bananas, mostly over the title, claiming that it was LIES DAMN LIES and basically a scam. Here are some of the more civil ones, to save you wading through the comments section to look for them:

“Boy, these articles are usually good. This one is a bit degrading, and completely misleading. They started with a portfolio of $570,000? Makes the entire article moot. They didn’t save a million in 4 years. But they did save over $100k a year, which tells us their income is far, far greater than the American median household salary of $53k.

“So what’s the point of the story? If you’re both work-a-holics with high paying jobs you can retire early? Great.”
– Commenter Scott

“Here we go again! Yet another bullsheet story courtesy of Yahoo. This article is soo full of holes is not even funny. If it is true, then they were extremely lucky to hold on to their jobs for ten years or more, during the worst recession in 50 years, in this day and age when the economy and job market is so volatile. In any case, here are some holes: This is the 8th or 9th similar ‘story’ in the last two months. Really yahoo? Are we to believe all this BS?

“First, this is nothing but an advert for investment companies.

“Second, -if this fairy tale is real- “putting $2,000 a month toward their investments, which stood at $570,000 when they started,” Here we have it. They didn’t EXACTLY started with $40. This is akin to Donald Trump when he said that he made his billions alone. His father only gave him $1 million to start with. Well. …”
[Whoops! Cutting this comment WAY off (it goes on, and on and on…) because it fails to actually fulfill that “more civil” promise I made to you. But the TL;DR of the rest of his comment? “YAHOO DIDN’T REPRINT THEIR ENTIRE BLOG IN ONE ARTICLE SO I COULD SCRUTINIZE ALL OF THEIR INCOME AND SPENDING WHICH IS READILY AVAILABLE TO ME IF I WOULD JUST LOOK BUT I WON’T BECAUSE RANTING ON YAHOO IS MORE FUN.”]
– Commenter “Antichiterra

“Whatever. “started with $570,000″ ?? Well at age 38 if you have that much you’ve already been investing a #$%$ load and you probably make a lot of money. Your probably in the top 10% income earners in the US. I’m 37 and have $2,800 in my retirement account. #$%$ loads of student loan debt and I am not able to get a job in my degree. I make about $2400 a month and live in LA where about 60% of my income goes to rent. After student loan bills, phone and regular bills I have nothing l have nothing left for retirement… THIS IS BS! Only for the rich to read.”
– Commenter BrandonM

None of these commenters seemed to check out the 1500s readily available blog about all this where, with just a small amount of reading around, I was able to learn that Mr. 1500 graduated from school with $60,000 in student loan debt. They spent 17 years building up from less-than-nothing, mostly by flipping houses.

But it reminds me of something else that happened on a Yahoo Finance article, years ago (what is it with the comments on Yahoo Finance?): Anya Kamenetz, author of Generation Debt, wrote an article there about some of her frugal money-saving habits, and though I found it tame compared to the lengths I had gone through that year to save money, some commenters ripped her apart for writing the article, and called her life of buying secondhand clothes and having no television “miserable.”

Interestingly enough, Mr. and Mrs. 1500 also got comments like this:

“…You can save a lot of money if you go on no trips and do nothing on your free time besides work, work, work. until you get your goal to retire. But life can be the pits if you do not life a little and go on a trip or two. But if it works for them, that’s good but not everyone can do it.”
– Commenter “Jim”

“Hey, great.. nothing to do but “log expenses” and spend time trying to trim household costs further…with 40 or 50 years to live, without cable and “expensive phone plans”…”
– Commenter “masondixon”

“OK, but they’re not really retired. So shouldn’t the article be titled how we saved $1M to work from home and live a substandard lifestyle. …”
– Commenter “Amelia”

Which makes it seem like some people understood that financial independence isn’t magic, at least.

First, let me get this out of the way: You can say whatever you want (within the Terms of Service of the site you are commenting on). Feel free to complain away, cry foul, yell, scream, rant, and do as you please. Freedom of speech, or whatever.

But.

You are not doing yourself any favors by responding to articles like these with a bunch of complaints about how “normal people can’t do that.” Every single person has their own advantages and disadvantages. The genetic lottery is not equal or fair to us all. I grew up in a rural area, across the street from a cornfield, born to parents who themselves didn’t have the grasp of good financial practices to be able to pass along to me. Some people have parents who teach them a lot, and they learn to save early. Some people are born with a silver spoon in their mouth and get a large inheritance.

None of these real-life “How They Did It” articles are ever going to be a turn-by-turn road map for you to follow. But all of us who want to achieve financial independence without a big, big inheritance? We can all do it, and there are only three ways to get there:

  1. Earn More
  2. Spend Less
  3. Earn More AND Spend Less

That’s it. Those are the options. Everything that can be done to achieve financial independence falls somewhere in there. Even if you win the lottery, you’ll only be financial independent if you figure out how to not spend it all right away.

It’s hard work, and some of the frugal choices that the 1500s, or Anya Kamenetz, or I, have made… well, they’re not for everyone. Just like how you may not be willing/able to go down to one car like my husband and I did last year, my husband and I are equally not able/willing to move to a lower cost of living area.

If you read an article like the one about the 1500s and you can’t find a single takeaway for your own life, that’s fine. They may be so very different from you that you simply could not replicate a single thing they did. But… I doubt that. They are normal people. Anya Kamenetz is normal. I’m normal. We’re all just folks here, and though no one can do exactly what I or the 1500s have done, 99.999% of people can do some of the things I’ve done, and some of the things that the 1500s have done, and form your own plan to reach your unique goals.

If you read an article like that one and all you can feel is anger, envy, and insecurity, it’s because you are missing the forest for the trees. That’s also true for people who pity me for my “miserly life” without cable television and a second car. Choices the 1500s have made put them on the path they are on, and choices I have made have put me on my path. But we’re all on a path of one type or another.

You can choose to take away useful lessons for your own life from any “How I Did It” article. Or you can brush people off and say “it can’t be done!” Those are choices, too, though. Which one do you think is going to help you on your own financial path?

Photo credit: yell by thorntocon on Flickr

Pregnant on Obamacare: The First Trimester

The true costs of being pregnant on Obamacare

I’m pregnant, I’m self-employed (as is my husband), and we’re on the absolute cheapest Healthcare.gov (a.k.a. Healthcare Marketplace, a.k.a. Obamacare) plan. So, what’s it like being pregnant on Obamacare? What’s it cost? Now that I’ve received all the bills from my first trimester care, I’m going to divulge all of the information from my experience:

Disclaimer Thing: The following information is all 100% accurate (as far as I know), but it is only one example of one woman (me!) being pregnant on Obamacare. Your mileage will vary, based on the health insurance plans available in your state and your zip code, your individual medical situation, and pure simple luck. I provide this information because I felt discouraged before my pregnancy by not being able to find examples of how much a pregnancy really costs on Obamacare – so now that I’m in a position to provide that example to others, I’m happy to do so.

Also, I’m just going to call it “Obamacare” from here on out because that’s the most commonly used term. Plus, it gives me lots of opportunities to make “Thanks, Obama!” jokes, and I do love me some referential jokes.

My Health Insurance Plan

My health insurer calls my plan a “Bronze Basic” plan, because Bronze is the lowest level available in the Healthcare Marketplace. Not only did I pick a plan in the lowest tier, I picked the cheapest plan available in that tier. It’s a High Deductible Health Plan (HDHP), which means I do pay for most things out of pocket (though anything that’s “preventative care” is supposed to be fully covered). But also, having a HDHP makes me eligible to contribute to a Health Savings Account (HSA), which makes me happy because HSAs are da best. The local chain of hospitals are all “in-network” on my health plan, which is part of why I felt comfortable taking the bottom-of-the-barrel plan: if the hospital literally down the street is in-network, that’s about all I need as a relatively young healthy person.

My husband and I don’t qualify for any subsidies on the plan, so we pay full price out-of-pocket for our premiums: $372.99 per month for the two of us. We also pay $27.15 per month for dental insurance (also obtained through the Marketplace, also one of the cheapest plans available to us), so my half comes out to $200.07 per month.

I mention dental insurance for two reasons: A) I consider it a part of my overall “health insurance” that I pay for out-of-pocket and B) dental health is a part of pregnancy, since gingivitis can lead to preterm birth (yikes!), so it’s recommended that pregnant women get an extra dental cleaning during pregnancy, and most dental plans (including mine) cover that extra pregnancy cleaning.

According to my plan’s documents (the “Summary of Benefits and Coverage” or “SBC” – a standardized document across all health insurance plans these days), here’s what my plan covers for pregnancy:

Obamacare Insurance Pregnancy Coverage

What my insurance plan covers – Click to enlarge

Basically, this says that I should pay nothing out-of-pocket for routine prenatal (pregnancy before delivery) care, and then that I’ll be on the hook for all of the delivery and postnatal (after delivery) care until I hit my deductible ($6,850 in my case), for in-network doctors and facilities.  If I were to visit an out-of-network doctor or facility, I’d pretty much be on the hook for everything from that bill, because my out-of-network deductible is a whopping $20,000.  So… in-network it is!

The nice thing about these SBCs is that they all also include some coverage examples, and one of those examples is… having a baby! Works out nicely for me. Here’s what the example looks like in my health insurance’s SBC:

Obamacare Insurance - Pregnancy Coverage

Coverage example from my health insurance – Click to enlarge

There is also a disclaimer that says “Sample care costs are based on national averages supplied by the U.S. Department of Health and Human Services, and aren’t specific to a particular geographic area or health plan.” So the first part, “sample care costs” estimated at $7,540, are a national average for routine pregnancies and deliveries. Fair enough. The second part, “patient pays,” is what’s applicable to me and my plan, and so the estimate is that a routine pregnancy will cost me $5,400 out of pocket on this plan.

My Real First Trimester Out-of-Pocket Costs

Let’s get down to brass tacks! The first trimester is usually defined as the first 12 weeks of the pregnancy, and actually includes a few weeks before conception. So I’m including all of my pregnancy-related expenses from the first 12 weeks, starting with the 2-pack of home pregnancy tests that I picked up at CVS when my period was 4 days late. (Spoiler alert: the result was positive!)

Doctors’ Visits: $397.90

The “Doctors’ Visits” category is higher than I would like, considering the information above about what my insurance is supposed to cover for routine in-network prenatal care (i.e. I should have paid nothing). I was shocked (shocked!) when I got a $377.90 bill for my first visit to the obstetrician (OB). So I did the thing that I know you’re supposed to do, but is pretty hard for me personally: I picked up the phone and called the insurance company to ask what the deal was.

Usually, calling your insurance is a good way to clear up mistakes and save yourself some money that you don’t actually need to pay. Unfortunately, there’s no such happy result here: the charge was legit. Even though all of my prenatal visits are supposed to be covered, since this was my very first visit to the OB’s office (I was not so much a “going to the doctor” person before my pregnancy), the first visit was coded as a “new patient visit” (which it was). New patient visits? Not covered by my insurance, so I had to pay the whole bill. At least it counts against my deductible! (Every little bit counts, right?)

The other $20 in the “Doctors’ visits” category was for my primary care physician – because I was on an Obamacare high-deductible plan, they charged me a $20 deposit that they don’t normally charge to other patients. Twenty bucks is not a big deal, of course, but it was a directly-related-to-my-Obamacare-plan expense.

Lab Work: $204.46

No real surprises in the lab work itself: my bodily fluids have been tested for all sorts of things, from the pregnancy test my primary care doctor ran after I first got my “2 lines” on the home kit, to the blood-typing test my OB ran to find out if I’m one of those lucky pregnant women with a negative blood type (which I already knew – I am!), to a urinalysis that came up positive for a urinary tract infection (common in pregnant women, and in my family in general, so the only shock there was I hadn’t felt it!). But financially, no shockers.

Drugstore expenses: $46.09

Totally reasonable, since this covers everything from the home pregnancy test, to prenatal vitamins, to the prescription for that UTI.

Altogether…

Doctors’ visits: $397.90
Lab work: $204.46
Drugstore expenses: $46.09
TOTAL: $648.45

All in all, not too bad – manageable considering I have my HSA to pay for anything I can’t cover strictly out of pocket. But still, higher than I anticipated, since I went into it knowing that all of my prenatal visits would be covered.

Will the trend hold up for the second and third trimesters? Stay tuned – I’ll give a second trimester rundown once I can be sure that all the bills have come in for that time period. And the third trimester? Well, you’ll have to wait until after I’ve delivered my little bundle of poop-and-snot for that, of course.

Have you gone through a pregnancy or other major medical expense on Obamacare? If so, I’d love it if you shared some info about the costs you incurred in the comments below. Or if you have a low-cost Obamacare plan – do you have any questions for me or others about our experiences?

How to Share a Credit Card with Your Spouse

[It was only recently, after a year and a half of marriage, that my husband and I got our first shared credit card. We’re still working out the kinks, and considering adding my husband as an authorized user to some of my frequently-used rewards cards as well. So I was over the moon when Joshua Heckathorn of Creditnet.com reached out and offered to write a guest post on the very subject. Take it away, Josh!]

You probably share your home, bed, and maybe even your toothbrush from time to time with your spouse. But what about your credit cards?

If you haven’t quite taken your financial relationship to this level yet, but feel like you’re finally ready to take the leap, follow these tips to make sure you do it right and avoid the most common mistakes.

How to Share a Credit Card With Your Spouse

Add Your Spouse as an Authorized User

The easiest way to share your credit card with a new spouse is to call your credit card issuer and simply add your significant other as an authorized user. Your spouse will then receive a new credit card in his or her name, although you will both share access to the same account and the same credit limit.

Before making the call to your credit issuer, it’s always wise to sit down and have a conversation with your spouse about what types of monthly expenses will be charged to the card and how much of the available credit limit you plan to use each month. In order to maximize each of your FICO credit scores, you’ll want to ideally keep your credit utilization ratio under 10 percent, so take the time to talk through the numbers before you both begin using the card.

Don’t be afraid to communicate openly about spending habits and the importance of sticking to your outlined budget. Trusting each other’s spending habits is vital to the process, and if the trust just isn’t there yet then maybe you still need more time before taking the next step.

Set Up Mobile Access and Text Alerts

The biggest red flag to watch out for is an unexpected charge that doesn’t fall in line with the budget you previously discussed. However, the great thing about credit cards is it’s so convenient to track all spending on your account.

Make sure you set up mobile access from your phones so you can check charges 24/7, and you may even be able to set up text alerts for any charges above a certain amount. If so, do it. This will allow you both to stay on top of your spending and immediately discuss anything that doesn’t seem to fall in line with your agreed upon budget.

Review Accounts Together on a Monthly Basis

Credit cards also make it extremely easy to review your spending on a monthly basis. So set aside 15 minutes each month to log on to your online account together, review charges, compare to your budget, and talk through how you did.

Did you stick to your plan and stay within your budget? Awesome. Go out and celebrate by doing something inexpensive that you both love.

Did you miss the mark for this month? Don’t be argumentative or point fingers at who made what mistake. Instead, make a new plan of action together and do a better job of tracking all charges during the following month. Understand that it can take some time to sync spending habits in a marriage, so don’t expect your spouse to change overnight.

Communication is Key

The biggest mistake couples make is failing to have a detailed discussion up front regarding monthly expenses and what types of things will be charged to the credit card. It seems simple enough, but many married couples just ignore this step, which often results in some fairly unpleasant conversations down the road.

So do yourselves a favor and talk through your budget, set expectations, and track your monthly expenditures together. If you do so, sharing a credit card can be an excellent way to not only improve both of your credit scores but also enjoy earning some great credit card rewards along the way.

Joshua Heckathorn runs Creditnet.com, a free resource to help consumers learn more about credit and compare credit cards online. He is a credit expert and has been featured on CNNMoney, FOX Business, Yahoo Finance, The Street, and many other national publications during the past ten years. Joshua resides in Seattle and holds an MBA and B.S. in finance.

 

Net Worth Update: July 2016

If you (or I) thought June was craaaaazy, it was nothing compared to July. At the very end of June, we found an apartment we liked and put in application to take possession of it on July 1st… and found out we’d been approved just in time to sign the lease on July 1st. We spent the month of July packing, moving, cleaning… and then we skipped town and went to Disney World. True story.

Change: +$55 or +0.18%

July Net Worth Total: $30,057

July 2016 Net Worth Graph - PoorerThanYou

Not so bad – up, but barely, closer to “flat” really. But hey, with a full apartment move to a bigger place and a Disney World vacation in the month of July? I’ll take flat. I’ll totally take flat.

Moving

So we signed the lease (obviously), packed up all of our stuff, and moved. This time around, we decided to hire both professional movers and a cleaning company instead of DIYing/bribing friends with the ol’ pizza and beer. We still had a little bit of help from my brother (who happened to have a day off work on the day of our move), but that was pretty much necessary to replace pregnant-me, who couldn’t be very helpful. (I carried some pillows I think, and packed the hanging clothes boxes, and pointed a lot to say where things should go.)

I haven’t done a good run-down yet of the total costs, but we did shop around for both services using Thumbtack.com, and that seemed to save us some good money. We’ll see when I run the math (in a future post), but Thumbtack definitely made it easier to compare different providers, so I’m pretty happy with that aspect of it.

DIDNEY WURL!

DIDNEY WURRRRLLLL - PoorerThanYou

Yup, this is us, at Walt Disney World.

With everything that’s been going on… how could we afford to just up and go to Disney World this month? Easy: saving, and travel hacking. I’ve never talked about travel hacking on this blog before, and this was my first real attempt at it (I did some very basic travel hacking back in 2014 by signing up for the Chase Sapphire Preferred credit card, which was offering a $400 sign-up bonus at the time, and putting the costs of my Ireland trip on that card to easily meet the spending amount needed to get the bonus.

But since then, I kinda forgot about the entire idea of travel hacking until my sister tried to organize a family trip to Disney World this year. There just seemed like no way we could pull together all the money for another Disney trip (husband and I went there for our honeymoon in late 2014 and dropped a good deal of cash to do so), until I remembered that travel hacking is a thing.

Again, this is the sort of thing that deserves its own post (or a whole series of posts, more likely), so I won’t dig any deeper into the topic right now, to spare anyone not interested in travel hacking. But the proof is in the pudding: we went to Disney at the end of July, and we moved to a more expensive place, and bought stuff for the new apartment, and yet… my net worth stayed steady.

Baby Stuffs

Oh right – still pregnant! We actually bought just a couple of things for our upcoming bundle of joy (read: bundle of poop and vomit, more likely – I harbor no illusions about motherhood): two “bodysuits” (Did you know that “onesie” is actually a trademarked term owned by Gerber? Just a little tidbit from my product copywriting business!), in 6-month size. Because I don’t believe in buying newborn sized stuff except a couple of plain white outfits, until I have proof that my baby will be newborn sized. And even if the kid is born small enough to need newborn-sized clothes (unlikely in my family of tall folks), most kids don’t need clothes in that size for long. So why buy the cute stuff in a size they’ll instantly outgrow?

UPickVG Baby OnesieBut aside from 2 adorable “one piece baby outfits” (including the one above, designed by a good friend for our charity fundraiser), we have still managed to not buy anything else for the bun in the oven. Hoping to keep that up until September, when we’ll be less than 2 months away from the arrival date, and the baby showers are done (so we can see what stuff we actually need).

That’s it for July – with moving and our trip, there really wasn’t time for anything else! But stay tuned, because August is already shaping up to be an interesting month. You see, we figured out something really extraordinary about my income and my upcoming maternity leave… but it won’t be relevant until we see how August all shakes out. 😀

Also, if you’d like to see how I stack up against other personal finance bloggers, be sure to check out The Ultimate List of Blogger Net Worths over on Rockstar Finance!

Net Worth Update: May 2016

Last month, I revealed my pregnancy and the fact that my expenses will be going up. So how did everything shake out for the month after that? Let’s dive in and see the numbers!

Change: +$4,370 or +15.92%

May Net Worth Total: $31,818

May 2016 Net Worth Chart

Building Up Cash Reserves for the Baby

This month’s increase can really be attributed to just one thing: I’m building up my cash reserves right now. (So is my husband, but our net worths are not combined for these blog updates.) With a baby coming in November, building up extra savings is an obvious thing to do.

Speaking of the baby – I now know what my total costs for the first trimester have been! Medical costs, anyway – we haven’t bought a single thing for the baby yet. No crib, no clothes, no toys, no adorable baby what-its of any kind. This is, in my mind, a good way to keep the costs of a new baby down: don’t buy anything until just before you actually need it. And until after you see what gifts you will get, because honestly there’s no sense in throwing money away and ending up with duplicates of some things. I’m not trying to be gift-grabby or expecting people will give us lots of gifts – I’m just being realistic about the fact that babies (especially first babies) are gift-giving occasions. Plus there’s the fact that I know so many people with slightly older children, so some hand-me-downs are to be expected in my case as well.

But back to medical costs – for the entire first trimester, including pregnancy tests, prenatal vitamins, and all doctor visits, the total out-of-pocket costs for weeks 1 – 12: $648.45. I’d say that’s pretty good, all things considered… where the “all things” to consider is that I’m self employed, and therefore on the cheapest Bronze-level Obamacare health insurance plan that was available to me. I was expecting a higher bill, due to being on the lowest rung of the health insurance ladder.

I’ll dive deeper into the numbers in a future blog post series about being pregnant on Obamacare – because honestly? Before I was pregnant, I started trying to do research into how much pregnancy would cost out-of-pocket on an Obamacare plan, and I couldn’t find much information, nor hardly anyone giving examples with concrete numbers. It sucked, and I’m happy to help someone else out by at least putting my concrete numbers on the internet. Of course the situation will be different for someone else’s pregnancy, but I just feel like examples should be shared. And you guys know how much I like to share numbers. 😉

UPickVG 5 is Coming

We also hustled pretty hard this month, knowing that next month will require us to take a few extra days off from the usual hustle, because we’re producing a weekend-long livestreamed internet game-a-thon. 48 hours straight of livestreaming takes not just the 3 days of the weekend that the fundraiser is live, but also some shoulder days for setup/breakdown, and rest and recovery. Not to mention we’ve already begun donating some of our own money to the fundraiser (cause it’s hard not to also want to kick in when you’re hustling so hard on behalf of a charity) and anticipate donating more during the event itself, so we’ve been trying to build up the “Charity” savings account to prepare for that.

In fact, by the time this post is actually posted, the UPickVG 5 fundraiser will already be over. The game-a-thon and its prep time are just too close to the beginning of the month of June for me to have all of May’s numbers and everything posted before I have to completely transition into “Showrunner” mode and focus all of my attention on UPickVG. So… I could tell you how the fundraiser did in the end here, but I won’t. I’ll save that for the update it belongs in: next month’s June update. You’ll just have to wait. 😛

Extra $200/month?

I’ve left the poll up for how I should save/spend the extra $200/month I’ll have, starting in July, due to the end of my car payment. I’ve left this poll up even though, in reality, it’s becoming clear that those dollars are all going to go toward rent for a bigger place than my current 1-bedroom/1-bath apartment. Because even if we don’t strictly need more space for the baby during the first 6 months of their life, I’m a big believer that we will need a second toilet. Somehow, my husband and I have thus far avoided any “both of us managed to get food poisoning at the same time” catastrophes (ala Bridesmaids), but with a third human in the home, I feel like we’re just asking for trouble with only 1 toilet. Even if that human won’t use the toilet for several years. Just askin’ for trouble.

So, the new apartment (with at least 1.5 bathrooms) search has begun.

But you can still vote in the poll, which has now become an interesting hypothetical to discuss, for an alternate universe version of Stephonee, where I am not pregnant and apartment shopping right now. So feel free to place your vote for what Alternate Universe Stephonee should do with her extra $200/month starting in July:

I’ll discuss my thoughts in the June update, but I will say that so far… the poll has been going in a very interesting direction, in my eyes.

Holiday Tree FOR AMERICA

We’ve updated our holiday tree to its summertime-long decorations, which will cover Memorial Day, Flag Day, Independence Day, and Labor Day:

Holiday Tree - Summer Patriot

O beautiful for spacious skies…

The flag that’s on top of the tree is pretty special to me: it’s from a Tweetup on the White House lawn that my husband and I went to years ago (when we were just friends), where we got to stand in the rain and see President Obama in person, as well as the President of South Korea. Well, not that the flag isn’t always special, but this exact physical object holds additional meaning in my life

Oh! And to give you the full effect of the fireworks lights…

Holiday Tree - Fireworks Animated Gif

Ooooo…… ahhhhhhhh!

That’s it for May! Check back next month for another update, and the discussion on the $200/month poll… and who knows what else!

Also, if you’d like to see how I stack up against other personal finance bloggers, be sure to check out The Ultimate List of Blogger Net Worths over on Rockstar Finance!

Net Worth Update: April 2016

April showers bring May…. more showers. I’m pretty sure that’s how the saying goes, at least according to the weather in Northern Virginia so far. The constant rain has been sort of a doozy, which ties in nicely to this month’s net worth & financial update…

Change: ($1,372) or -4.76%

April Net Worth Total: $27,448

April 2016 Net Worth ChartAlright, so it’s down. Let’s dig a bit into what happened in April:

Taxes

April is tax month! Even though I completed our tax return back in, what, February? (I don’t even remember now, it’s been that long.) But we owed money, to the tune of over $6,000 (yay self-employment for two people!), and of course, I put off that withdrawal from our account pretty much as long as possible. So the IRS took their payment in early April. And then, we also paid estimated taxes for Quarter-1 2016, since those were due in April as well. Double whammy. But that lowered my “tax liability” in the liabilities column, so the whole thing was actually a wash. Neither up nor down in that category – as it should be.

My car lost $1,972 in value

For no reason! Well, not no reason, I suspect, but for no clear reason. My Toyota Camry passed 100,000 miles, but that was a few months ago and not in April, so it (probably) wasn’t that. As far as I can tell, the Camry just goes through seasons where Kelly Blue Book values it more or less than it did before. It may bounce back later in the year. Or it might not. I’m not really worried about it – after all, I’m about to pay off the car in a few months, so it having any amount of value left in it is just gravy. I’m not looking to sell the Camry anytime soon, so its value is more just a good way to keep track of value vs. loan, and that loan is almost gone!

If you were to ignore the car value change, I would actually be up $600 for the month, so… I’m not losing any sleep whatsoever on this month’s net worth loss. When it’s based on something completely out of my control, it’s not worth dwelling on.

Bun in the oven

Since it’s more than likely that this will have financial implications for the rest of my life, it’s hard to talk about any of my personal finances without making this announcement: I’m pregnant. Due in November. We won’t be finding out the sex of the baby beforehand. (There, I think I’ve covered the most Frequently Asked Questions.)

The long-term implications will of course unfold over time, but in the near-term, this has meant many more doctor visits than I was making previously, a lot of which has been (surprisingly) covered by my very-bottom-tier Obamacare insurance. I’ve had to shell some amount out-of-pocket, but it’s been fairly low amounts. I assume the bill for the delivery will quite large, but I’ve got several months and a Health Savings Account (HSA) to help with that.

The other effect is that we’ve started looking for a bigger apartment to rent. Running the New York Times Buy vs. Rent calculator (as I always do when the question of moving comes up) on some properties in our area that would fit our needs, it comes out that if we can “rent a similar home for less than $1614/month, then renting is better.” There are some 2-bedroom condos and townhouses in our area for that rate, so as usual, we’re leaning strongly toward continuing to rent. But for this round of rental hunting, time is on our side. We don’t need a bigger place until the baby is about 6 months old or so (it would be hard to feed a kid at a high chair in our current kitchen/dining room area), so we’ve got a full year to find a place and move. Plus, our current lease is now month-to-month, so we have the flexibility to jump on a place if it’s a great deal, and pass on anything that isn’t.

The bad news? Paying for a bigger place will probably knock out the extra $194/month that I’ll be freeing up when I pay off my car in July. As far as we can tell, that will go straight into the rent on the next place. So we’ll be able to pocket that money for a few months, and then it’ll be rolled into the new higher rent of a bigger place when, well, we find a bigger place.

Poll!

The poll for how I should divvy up my car payment money (once the car is paid off in July) is still open, though because of the above-mentioned larger apartment search, it seems less relevant now. But just for fun, here it is again:

And that’s all she wrote! We really need to get our super-patriotic decorations up on the Holiday Tree before Memorial Day, but as we haven’t done it yet, I haven’t got any photos to share with you. Next month!

Also, if you’d like to see how I stack up against other personal finance bloggers, be sure to check out The Ultimate List of Blogger Net Worths over on Rockstar Finance!

Check Your Credit Score and Credit Report Today, for Free!

Updated as of April 2016

April is one of the months that I have designated to check my credit report. Since you’re allowed (by law) a free credit report annually from each of the 3 credit reporting agencies, that gives you an opportunity to check one report every four months. Here’s the schedule I recommend:

  • April (because everyone’s thinking about money anyways because of the tax deadline)
  • August (four months after April)
  • December (another four months later, and also the end of the year, another convenient time)

So consider this your reminder for April to pull your credit report from one of the three agencies this month! You’ll need to assign one credit reporting agency to these months, to make it work, since you’re only allowed to pull each report once a year. So do something like this:

  • April – Experian
  • August – TransUnion
  • December – Equifax

Remember, despite what TV commercials starring singing characters might tell you, there’s only one authorized source for getting your federally-mandated free annual credit reports: AnnualCreditReport.com. You can verify this fact at the Federal Trade Commission’s website.

Getting Your Credit Report, 100% Free

Information You’ll Need to Have Handy

When pulling one of your 3 credit reports from AnnualCreditReport.com, you’ll be asked a short series of questions to prove your identity (so that, in theory, no one else can pull your reports).

You’ll need to know (or have handy to type in):

  • Your full name
  • Your Social Security Number
  • Your current address
  • Any addresses you’ve lived at in the last two years

Once you hand over this info, you’ll be given the opportunity to request your report from any of the 3 credit rating agencies:

  • Experian
  • TransUnion
  • Equifax

If this is your first time pulling your report, it doesn’t really matter which one you pull. For simplicity’s sake, I recommend pulling Experian, as it always seems to be at the top of the list, so it will be easier to remember that it’s the one you pulled if you forget. Now’s the time to establish your April/August/December calendar for pulling each of these.

Once you select a credit reporting agency to pull from, you will be asked a series of multiple-choice questions about your own credit history (or other things that might appear on your report, such as previous addresses and phone numbers, etc. etc.) to further prove your identity. Again, this is information you should already know or keep handy.

You may also be prompted to buy some “up-sell” products, like your credit score. Ignore everything they offer here – even if you do want to buy your credit score, they’re not likely to offer you the best of their best deals at this point. Do your research on the cheapest ways to get the score you want (see below) first.

Then, you should get access to your report! You should print a copy of both the receipt page (which you’ll get even though you didn’t pay anything) and your credit report itself. If you’re using Google Chrome or have a PDF printer installed (highly recommended!), you can print to PDF and save part of a tree – as long as your hard drive is secure and you do regular secure backups, of course. This is sensitive information that an identity thief would love to get their hands on!

What am I Looking for When I Look at my Credit Report?

Two things!

#1 – Errors

It’s a pain in the behind, but read your entire report and look for anything that’s inaccurate. You can dispute inaccuracies with the credit reporting agency to get them removed. Inaccuracies can hurt your credit score, prevent you from getting a loan, job, or insurance down the line, or just plain make it hard to get your report again in the future (thanks to those multiple-choice questions!).

If you do find any errors, there should be instructions within the report itself (or back on your receipt or confirmation page) on how to dispute them. If not, do a quick Google search for “disputing errors [name of credit reporting agency that you picked].”

Even if there aren’t any errors, there could still be bad stuff…

#2 – Areas for Improvement

While you’re reading your credit report, look out for anything you could be doing to improve your report. What can you do, exactly? Well, if you familiarize yourself with the 5 components of your credit score, you can identify ways to influence those components.

Those 5 components are (in order from most influential on your score, to least):

  1. On-time payment history
  2. Debt-to-credit ratio
  3. Length of credit history
  4. Variety of credit used
  5. Recent “hard” credit inquiries

Keep these things in mind while you look over the report. Just keep in mind that in most cases, there’s nothing you can do to “fix” what’s already on your report – you can only strive to do better in the future.

For most people, most of the time, pulling your credit reports one at a time, three times a year, to check them for reports and areas to improve, is all you really need. But if you’re curious about your credit score, or if you’re going to be shopping for a big loan (like a mortgage) in the near future, you may decide that you want access to that score.

How I Get My Credit Score for Free

Before we get into how I get my credit score without forking over any cash, it’s important to establish that there are many different credit scores out there. You may actually have as many as 100 different credit scores floating out there for you. Scary thought, huh?

Most people divide credit scores into two types:

  • FICO – credit scores based on one your three reports using the Fair Isaac Corporation’s algorithm (aka the five criteria for a good score I outlined above)
  • FAKO (pronounced “Fake-O”) – anything else

A FICO score is what a lender, employer, rental authority, or insurance agent is most likely to look at when they pull your credit score, so ideally that’s the credit score you want if you’re pulling your score to find out exactly what such a person will see.

Credit Card Perks

A fairly new development over the last few years that makes me pretty happy: several credit card companies are giving their customers a free peek at one of their FICO scores. My American Express card gives me a free FICO score, as does my Pentagon Federal Credit Union account. I simply log into my existing online account and click one button, and get my true FICO score, for free!

The catches: for one thing, you need to have or get a credit card with a company that provides this as a credit card perk. If you already have any credit cards, log into your online account(s) and poke around to see if there are any “Get your free FICO score!” links in your account. If none of your credit cards offer this, you’ll need to use one of the alternatives below to get your free score.

The other catch is that this score may not update as often as you like. It looks like at least one of my free FICO scores via credit card only updates every 3 months. This is fine for just satisfying my normal curiosity, but if I were to be looking for the most up-to-date info to get a new loan in a few weeks, I’d want something more recent.

Mint

I already use Mint.com to track my transactions across all of my accounts, so it’s really convenient to have a free one-click credit score in there, too! Mint is run by the company Intuit, who I already trust with my financial information (they’re the folks who run TurboTax). The only problems with the Mint credit score are: #1) It’s a FAKO score, not a FICO score (this one based on your Equifax credit report), and #2) It only updates every few months. Still, it provides some insight into where the score is coming from (and what’s on your Equifax report), so it can be a good way to keep an eye on your Equifax data throughout the year.

WalletHub

It’s a FAKO score (your TransUnion VantageScore), but you can pull both the score and your TransUnion report daily – for free! And it’s a “soft pull” on your credit, so you’re not taking a “hard” hit to your score daily by checking (very important!). Signing up for WalletHub is quick and easy: very similar to getting your free credit reports from AnnualCreditReport.com, you’ll just need to put in some information and answer a security quiz to verify your identity.

Credit Karma

You get FAKO scores (VantageScore 3.0 scores from TransUnion and Equifax), but it’s free and you can request your scores from Credit Karma as often as daily without putting a “hard” inquiry on your credit report. You also get two more FAKO scores from TransUnion: your Auto Insurance Score and your Home Insurance Score, as well as some tips for improving your score and some savings offers.

How accurate are these scores to your real TransUnion and Equifax FICO scores? Hard to say, unless you also pay for your FICO scores to compare. But, the real question is: does it really matter for your purposes?

If the only reason you want to see your credit score is to satisfy curiosity, and to keep an eye on the changes of it over time, then the VantageScore will work just fine for that. Keep any eye on your score for any drastic changes, checking it at least as often as you pull your free reports (but monthly would be even better).

Credit Sesame

Another FAKO score, Credit Sesame is based on your Experian report. It’s also free with no credit card required to sign up, and you’ll get free advice on saving money and improving your credit, too.

The catch? You can only get your score once a month- but if you’re just looking to see how your credit score is doing over time, do you really need it more often than that? No, ya don’t. This is a good addition to Credit Karma, since it diversifies your “score base” by giving you access to an Experian score vs. Credit Karma’s TransUnion-and-Equifax-based scores.

Get a Loan

This may seem counter-intuitive, but it can work! If you’re reasonably certain of your good credit score (by checking it on one of the other sources in this post, and checking your credit reports themselves), you can get your true FICO score for free while getting a loan.

How? You just ask!

When I bought my Camry in 2012, the dealership helped me apply for a loan at several different financial institutions. When the offers came back a few days later, the finance guy at the dealership showed me the credit reports and scores that had come back when the banks evaluated me. Now, I could have just jotted down those numbers quickly, but I did one better:

I asked the dealership finance guy if I could have copies of all those papers! (It was definitely one of those it never hurts to ask moments.) He walked me back to their copier on the spot, giving me hard copies of my FICO and other credit scores from multiple agencies. Score!

This will also work when applying for a Peer-to-Peer loan from either Lending Club or Prosper; Jonathan over at My Money Blog has a guide on how to interpret your score based on the information you get while applying for a loan at either of these places.

The catch here is that your credit score will be a little dinged, since you’re doing what’s called a “hard inquiry” rather than the “soft inquiry” of checking you credit score just to check it. Oh, and you’re applying for a friggin loan, which you should never do unless you have a darn good reason, like needing to replace your dying car with an affordable, reliable, used one.

FICO Score Estimator

A few quick questions about your credit history, and myFICO’s FICO Score Estimator will spit out a fairly accurate guestimate range of where your credit score is. The catch being that it is, of course, only an estimate.

Alternately, Just Bite the Bullet

If you really, truly, actually need your FICO scores because you’re taking out a big loan soon (such as a mortgage), than the best thing to do is to just pay for your FICO scores. In the grand scheme of things, the $15 or so you spend now will reap much larger benefits down the road.

You can use your FICO score to empower your search for the best loan with the lowest rate – but only if you know it! A FAKO score won’t cut it in this particular case, so it’s worth spending the cash when you are actually about to start shopping for a loan.

Remember to shop around for your FICO scores, as well! There’s no need to pay more than you have to, and considering I’ve seen ranges between $14.95 and $89.95 to get your three FICO scores, it really is worth it to do a little research. Check the websites of all three credit rating agencies, as well as myFICO, to see what they’re offering. Don’t forget to Google for coupon codes to each one!

Do you check your credit reports and credit scores as often as you should? Make a pledge to April/August/December in the comments!

Net Worth Update: March 2016

Yes, I indulged myself in a little April Fool’s Day prankery yesterday – sorry if I got anyone’s hopes up too high about my bright future in a tiny house! It would have made for a great series on the blog here, that’s for sure. But don’t worry: I actually do have a few fun blog series planned for the next few months (including the long-awaited budget wedding series that I worked on writing back when I couldn’t post anything!), so don’t you worry about that.

For now, let’s do the numbers!

Change: +$5,604 or +24.14%

March Net Worth Total: $28,820

March 2016 Net Worth GraphAwwwww yus! A recovering stock market, new higher rates for one of my freelance projects, a few unexpected pieces of work thrown my way for another project, and this ended up being a real good month. Rullllll good.

Honestly, having this be a good month was a little unexpected. I had several out of pocket expenditures that I expected to deliver a good hit (6 months of car insurance due at once, a new laptop to replace my old one that was literally 7 years old…) but my worries were for not, it seems!

In other good news: I have just 4 payments left to go on my car loan! I’ve never worried much about paying it off early (since the interest rate is only 1.99%, I’ve always had bigger fish to fry), but even just making the required minimum payment every month, that bill is about to come to an end, and then I’ll own my car outright.

As far as what to do with the $194/month once the loan is paid off, I’ve got a few ideas, so why don’t we have a vote? (Since I will likely split the money between a few different options, you can select as many options from the poll as you like!)

Feel free to ask me any questions you like in the comments below before you cast your vote! Like “how much are you currently contributing to [x]?” or “what kind of pony?” (The important questions in life, you know.)

Oh, and one last thing before we wrap this update up: a Holiday Tree Update for those of you who have become addicted to this thing (it’s our Easter Tree this month!):

Holiday Tree - Easter

Also, if you’d like to see how I stack up against other personal finance bloggers, be sure to check out The Ultimate List of Blogger Net Worths over on Rockstar Finance!

Downsizing: We’re Moving to a Tiny House!

Update: Thanks to everyone who played along, but this was another one of my classic April Fool’s day pranks! Though I love the tiny house movement (especially looking at pictures of them), moving into one isn’t actually in the cards for me at this time. But aside from “actually moving into a tiny home” the following post was about 90% true… because that’s how a good April Fool’s prank works. 😉

I am so excited to finally be able to reveal the news to you, blog readers, and all of our friends and family, that we’re moving! And we’re not just moving to a new apartment (how boring) or finally throwing our money down the drain on a single-family home or townhouse. Nope, we’re thinking small and taking only a few things with us to a brand new tiny house!

If you haven’t heard of the Tiny House Movement yet, you’re in for a treat of “real estate porn” (SFW!) as there are tons of amazing photos, videos, and even televisions shows now available for your perusal, just a Google search away! I first heard of tiny homes and the movement in regards to the Tumbleweed Tiny House Company, which sells designs for adorable, functional, tiny houses, years ago – back when this blog was still in its infancy. (That means nearly 10 years ago, and we’ve all gotten 10 years older if you do the math, so just don’t.)

Tiny House Dream Home

Not our tiny house, but definitely a vision of the dream! – Photo credit:
Benjamin Chun, CC BY-SA 2.0

Living in a tiny house instantly became a dream of mine as soon as I saw photos of the Tumbleweed houses. Minimalism is something I’ve always aspired to, but fallen far, far short of. My tendencies to be a “mother hen,” take care of everything and everyone, have always led me to keep everything… just in case. I might need these garage sale stickers someday! And every shoe box ever, since we have so much stuff kept aside to put in them! And I’ll just keep this power cord long after the gadget dies, because it might power something else some day!

But now, I’m getting rid of all this extraneous stuff through force – there isn’t going to be anywhere to put it! Our new home will only fit the absolute essentials, and that’s part of the point. No longer weighed down by the piles and piles of stuff we keep in our home, we’ll be forced to focus on what matters – which will, incidentally, save us a ton of money! The total housing costs on the tiny house will be far less than the rent we pay for our current apartment (despite the fact that we’ll own the tiny house, outright, and have maintenance costs), utilities will be lower, and just not being able to buy new physical objects will seriously improve our bottom line. Not to mention all the furniture and stuff we’re selling on our way out!

How Did This Happen?

I’m going to do a series of blog posts about the whole process, but since this is the Big Announcement and all, I’ll stay out of the details for now and give you the backstory. You already know that I stumbled upon the idea of tiny homes from personal finance blogs back in the day, but how did I get from hearing about tiny homes, to packing up (some of) my stuff to move into one?

The real catalyst happened two summers ago, when my LadyBros and I (yes we call ourselves that, because we’re awesome) took a short trip into downtown Washington D.C. to visit Boneyard Studios, a tiny house community that does tours! It was the first time I ever got to see a real-live tiny house in person, and we also got a chance to talk with the owner/builders of three of the four houses. They gave really honest, frank information about the realities of building and living in a tiny house – instead of just the candy-coated blog posts I had seen before.

Boneyard Studios Tiny Houses

The Boneyard Studios tiny houses, looking roughly like they did when I visited in 2014! – Photo credit: Inhabitat CC BY-NC-ND 2.0

It was very refreshing to get the real story from real tiny house dwellers, but some of what I’d learned that day did scare me off from pursuing my tiny house dream for a while. There is a lot of reality to contend with when it comes to tiny homes – zoning laws being the biggest, but there’s also construction setbacks, weather and insulation issues, and of course, an adjustment period to living in a compact space. Facing some of the reality of a tiny home caused me to take some serious pause, and put the idea on a shelf for a few years.

Recently, however, the idea has crawled its way back into my noggin. Partly because my in-laws have started watching the TV show Tiny House Nation and discussing the idea with us whenever we visit, which has put the subject back on the table for discussion. The other reason I got back into thinking about buying a tiny house: apartment shopping. Spending some time online, looking at larger apartments with my husband (we’re in a 1-bedroom right now), we just felt so disappointed at the price of everything – even other 1-bedrooms. It was more disheartening to see the price of 2-bedroom apartments in northern Virginia than the disappointment I had felt considering the realities of a tiny house.

The hard part, of course, has been bringing my husband on board with the idea. Not that he’s stubborn, but he obviously had a lot of concerns about the idea. It may seem silly to some people, but our main hobby is playing video games (live on the internet and for charity, in my case, and for recreation in his case), and so his first question is always “where will my games and systems go?” The good news is that his favorite system, the New Nintendo 3DS handheld (yes, “New” is a part of the official name – it’s a dumb name), is about as tiny-home friendly as a video game system can be! With some culling, consolidation, and smart storage solutions in the new tiny house, the rest of his collection will be fine to come with us, so he’s pretty happy at this point.

The key? Mercilessly getting rid of anything else we don’t love to make room in the house for the things we do love. We’re preparing massive stacks of personal belongings for eBay, craigslist, and donating. (And if you’re a local friend of ours, you may have noticed some new pushiness out of us to come pick up anything you lent to us or left at our place!) I can’t wait to get it all out the door so that I can share a final tally of the money we get back from selling!

Much more information to come in the next few months! I’ll be documenting the whole process in a series of blog posts (this being the first!) that I’m calling The Tiny House Move. (Real creative, right? I’m a genius writer, I know.) Watch this space for new posts every other week or so as we make our move!

Have you considered moving to a tiny house to save money and achieve minimalist nirvana? Are you now totes jelly that I’m beating you to the punch? Or have you beaten ME to the punch and are reading from your adorable tiny house right now? Whatever your story, please leave it in the comments below!