Tuesday, April 29, 2008

It Finally Happened: Gas Costs More Than A Cup of Starbucks Coffee

Our Little House

President Bush is on TV right now giving a press conference about the rising gas prices.  He keeps mentioning the sub-prime lending crisis, the foreclosures, rising food prices and other economic hard times that America is experiencing.
I personally love all the financial discussions going on right now.  In fact, by the time I was about to graduate college, I realized too late how much I loved my Finance classes.  I already was getting two degrees and certainly wasn't going to extend my stay in college, but the numbers were still magical to me.  The day I learned about mutual funds and their growth potential, I went home and signed up for one.  I didn't have much money, but thought I could invest $50 a month. When I finally cashed it in, I had $2000 from money that I never missed. I'm still committed to saving little by little to achieve goals.

In our own home, we are experiencing our own sort of financial balancing. This past year has been astronomical in expenses for us.  G bought my engagement ring, we paid for our wedding, the flights for G's family from Puerto Rico to SC, and as soon as we returned from our honeymoon we bought a house.  We paid for deposits and many things along the way in thousands of dollar chunks sometimes, but as it happens with weddings, the costs overflow the budget.  When we finally counted it all up after the dust settled, we had a lot more debt than we had expected.  That's when we had to sit down and make a plan.  And thank God we did, because I'm happy to report that this month we have finally paid off the last credit card bill.  It took a lot of talking, some sacrifice and continuous balancing of what we need now and what we can wait on.  

When I hear about the country in financial crisis partly because of high gas prices, I can't help but think how spoiled we all are as a nation.  High gas prices are nothing new to Europe and other parts of the world.  That is why when you go to other countries, you see much smaller cars and better public transportation.  (They also don't drive to the mailbox, but that's another point altogether.)  We really do take our right to consume very seriously here and it gets us into trouble as a country and in our own personal finances.  

One main reason is that debt is socially acceptable to us.  Did you know that in France when you go to purchase a home having credit is looked at suspiciously?  In America, if you don't have credit you can't even buy a home.  Credit and debt are shameful, except here where it is so common that we take it for granted and assume that it is just the American Way.  Although I have gotten out of debt several times in my life, I still include myself in the spoiled American category.  It is me (and G) getting out of debt here after all.  I believe there has to be a shift in perspective that has to occur to keep you from getting in debt at all. It's an actual realization that you can't afford something, and that is not something that we are accustomed to hearing, even from ourselves.

I want to tell you some of the specific things we did to get out of debt so quickly.  This is part of the sacrifice that we were willing to do because it is so important to us.

1- No Cable TV.  We have rabbit ears and they look strange on top of our 20" TV, but believe me you can still watch too much TV with only 3 channels.

2- One Car.  In January we decided to sell G's Acura MDX.  We had a loan on it and the gas mileage was terrible.  This was one of the biggest sacrifices because we are left with my Honda CRV that currently has 209,000 miles.  Most wouldn't have made this decision I know, but it was the right one for us.  Being a one car family has been awkward at times, but overall hasn't been a problem at all.  Part of this plan is saving for a new car to pay cash.  I've never done this before and it feels very extreme, but why not?  Go look at how much you pay in interest on your loan every month and you'll see why we want to do this.  It may take all year.  If we end up getting a hybrid like we want to get, we may have to finance part of it.  

3- A Bucket of Money for Everything.  We have our budget broken down into everything that we buy.  Ok, that sounds restrictive, but we each have our own allowance that we can use or save for whatever we want.  I just bought us new Pacific Coast Feather Co. down pillows like they had at the Marriot on our recent trip to Park City, Utah.  Divine!  We have a travel budget and do our best to stick with how much we save and not go over.  This helps us not to get in a credit backlog after trips. Don't forget a bucket for saving. We have several buckets, retirement, car, emergency fund, and smaller ones for things we want. 

4- Imagination.  Learning to look around your town or your home for free things to do boosts your creativity.  We go to a free putt putt course in our town, play Dominoes, basketball, go rollerblading, free night at the museum, go to doggy parks, and make an event out of Lost on Thursday nights.  

5- Evaluate all monthly charges.  I'm talking about gym memberships, phone, cable, internet, netflix, car payments, mortgages, cell phones, etc.  Be realistic about what you use, don't duplicate, refinance now if you need to do so-you can even refinance your car.

6- We bought a house that would give us a comfortable monthly payment and NOT what the bank told us we could afford.  Be careful to include all the expenses like homeowner's insurance, taxes, homeowners association when you figure what price range you are in.  Also, the upfront expenses to care for your home can be high and unexpected.  I mean, who enjoys buying mulch?  

7- Home Cooking.  We rarely eat out.  I love to cook and Gustavo loves to eat so no trouble here for us.

I heard on the radio that the price of gas has now gotten so high that it is actually making people change their behavior.  Apparently before the breaking point, we just keep doing to same old thing and then one day we decide enough is enough.  The high gas prices are a catalyst that are making people buy smaller cars, drive less, rethink many lifestyle decisions that affect the bottom line.  Although I don't wish for these high prices, I think the change that we are seeing brought about can be a positive if it changes us personally and in our country for the better.  Choosing to consume less can give us more peace and contentment in our lives.

In our own personal financial correction, we have learned so much about self-control, the joy of delayed gratification and how we really can live with just one car.  I'd love to hear about how your life has changed in a positive way because of getting out of debt or the high gas prices.

Thursday, April 24, 2008

The Tug of War, Then the Release

After I posted the various odd bits for sale on this site, I started having a conflict with doing it.  It's not that I have a problem with selling things in general, but it was all the trouble I went through to do so.  I spent most of the day trying to figure out how to get the Paypal button to work, then I realized I hadn't changed to my married name in the Paypal account, hadn't updated my credit card, and didn't have a merchant account.  They are all fairly minor issues, but added up to a whole day of frustration trying to "deal with" these things that I didn't want anymore.  Add on top of that, the time it took to take photos, download them and write a post about them.

Of course, this is the essential crux of the problem people have in cleaning out their closets. We want to make the most out of everything, like squeezing blood from a turnip.  In the past, I would always have my to-go bag and give away clothes, perfume, or whatever to friends or family, but my reliable sources for giving live 1400 miles away.  Now, I give plenty to charity here, but this cleaning out of the closet was different.  These are items that I still wear, but they just don't make me feel that great when I do.  I wanted them to be loved by someone else.  

Again, as I write I am laughing at myself because this whole line of reasoning is just spinning.  In order to release, you have to release.  All this activity involved in the releasing is just delaying the reward.  There are a pile of clothes on a chair in my living room that I am looking at right now.  The clutter is making me feel terrible and is part of what inspired this post.  

The more I have thought about it, the more I know that giving away the rest of these things is the answer.  Would you believe that when I moved here, I mailed boxes of things I didn't want back to my family.  I spent $50 for shipping things that I didn't want anymore.  Now that is ridiculous!  Today, I went on to makeupalley to see if I had something that someone wanted to swap for, and boy is that a lot of work.  I'm supposed to look for someone that wants what I have, then see if I want what they have and then have to go to the post office and stand in line to mail it to them?  Oh, no.  (I realize this can be fun for some.)  I am a member of Freecycle too, but I'm not sure I want people coming to my house to pick up stuff.  

The whole process of selling these things has generated bad energy in me.  I felt like I was thinking too small and I wasn't happy with that in myself.  Go away, bad karma!  

Amazingly enough, just writing this seems to have cleared the bad energy in me because now I know that I will package up these nice things and be able to bless someone else with them. When I was growing up, getting a bag full of used clothes from my cousin or even a woman I didn't know was one of my happiest moments!  I remember when I was 13 and living in Florida with my Dad, I got a bag of clothes that my Step-mom brought from someone.  It was filled with Jane Fonda-like aerobic wear, a pair of yellow Liz Claiborne shoes with a paisley that looped up around the toes (and my friends told me gave me toe cleavage), a yellow sweater with small embroidered Mickey Mouses on it and much more.  I'm laughing now, but I'm telling you that I think I wore everything in that bag. (I did not grow up in a wealthy suburb, ok. Shopping was not in my extra-curricular activities.)

Maybe I'm crazy or a little obssessed, but some of you must understand me. (I'm crossing my fingers that you do.)  In honor of my progress (and Stephanie's-see comments in Julia's basket post), leave me a comment with a subject you'd like me to write about and I'm going to send someone a little package from my sample goodie box.   For you, I will stand in line at the post office.

Some books to help you clean out your "good stuff" too.  Be sure to look at your library first.

Thursday, April 03, 2008

Julia's Basket of Self-Knowledge

Julia, my Maid of Honor and Kindred Spirit, and me

Once upon a time there was a young woman, me, who fell in love with a couple of pink chairs from Mitchell Gold.  While I was at the annual market sale deciding if they were too frivolous for reality, I met another young woman, Julia.  She was working that day, only for the special market sale and she was helping me with my pink chair dilemma.  I was with my aunt and as Julia walked away I said "That girl is me."  She dresses likes me, thinks like me and I had this uncanny feeling that we must be kindred spirits.  I got her email and even though we lived two hours apart we became friends.  She came to visit me in Greenville, SC.  I stayed with her in Hickory, NC.  We talked of trips to Italy.  She was the Maid of Honor in my wedding.  She is a friend that I can be totally honest with no matter how awful it sounds coming out.  I love those kind of friends because I always wanted a sister and this is the closest experience that I could have to that.

One weekend I was staying at her lovely, impeccably decorated and Mitchell Gold outfitted home and I noticed something in her bathroom.  It was a basket.  It had lotion, eye shadow, maybe a lipstick, and very few other things.  Curious, I asked her about the basket full of very few potion bottles in her bathroom.  She said those were all that she had.  A bottle of lotion, one eyeshadow (not even a palette!), ONE LIPSTICK, and maybe a blush that she didn't really use.  I shudder as I write this as I remember the truth dawning on me that my soul-friend could have so little in the way of makeup and potion bottles.  Mine tends to be under the sink, on top of the sink, in storage bins, taking up drawer space, in my purse, and on top of the dresser. Julia seriously only buys one color lipstick and she keeps buying it over and over.  Another shock to me because I have a hard time with repeat buying.  There are so many others to try!

Having said all that, this little basket has been my inspiration ever since I laid eyes on it.  Yes, I have bought baskets to emulate it only to have them overflowing in a short time.  I do console myself and Gustavo when I point out to him how much LESS I have than I used to have. Remember that linen closet in my condo?  It was full.  Remember the apartment after that?  It was only the full length under the double sink vanity.  Now, only under my sink and a small drawer in the closet, er and a small storage container and ok on top of the sink.  Oh, I forgot about the little baskets I bought at Ikea last week, but to be fair they do have mouthwash and necessary potions in them too.

No matter the present or past circumstances, I keep my eye on the prize.  Every free gift with purchase that I pass by is a coup for me.  These are little samples and full size products that won't be cluttering up my space.  Nordstrom having a free gift with purchase right now does not phase me when I keep my eye on the prize.  Although, if I do study the contents of the gift it does make me falter slightly as I carefully analyze to see if I will actually like the gift and if I actually do need to order something.  That is always a mistake.  That is why they say keep your eye on the goal, and not the anti-goal.  

One time when Julia spent the weekend with me, I scheduled makeovers for us at Chanel.  This was our first visit together and before I knew about the basket.  After the makeover I deliberated what I was going to get and ended up with an eyeshadow palette and an eyeliner. Julia didn't succumb to the temptation.  She didn't seem all that impressed either.  She is so strong in her makeup convictions that I envy her that.  Me, if my eyes meet the makeup artist and I see she has a willing spirit, I am up on her chair so fast it will make your head spin.  "Can I try our new colors on you?" is music to my ears.  Just a few days ago I had a Bobbi Brown makeover and discovered that now I need their new CLC lipstick in Rose Petal and maybe the foundation too.

One day I am going to achieve the goal of simplicity in my makeup and skincare routine.  I know it because I have made great strides in not being tempted by so many things.  I "just say no" quite often to Sephora Insider rewards, to many, many gift with purchases, to spontaneous makeup purchases and to kits that are a good deal but that have items I don't need in them.  I know that I am a makeup addict and even though it's "cool" to be that when you are perusing blogs and reading magazines, I think it's much cooler to know what you want and get that.  To me, that is what the basket represents.  It is a streamlined knowledge of who you are and most importantly who you are not.  

Our Trip to Rosemary Beach, Florida

I'm linking up again with  Erika ,  Andrea  and  Narci  for the Friday Favorites!  I love reading everyone's favorites too! ...