Monthly Archives: January 2013

Working On Our Taxes

I spent an hour last night working on our taxes.

I have entered information about our income, child care costs, and various deductions.

I am still waiting on a couple of tax-related documents, so for a trial-run, I estimated.  It looks like we will be receiving a small refund from the federal government and owe a small amount to our state government.

I can remember the first time I filed taxes.  I was still living at home with my parents – and we went to the local library to pick up paper forms for the 1040EZ.  That was more than 20 years ago.

Now, I file online via H&R Block At Home Online (Save 15% ).  The process is simple, with a step-by-step guide.

Even as we are making progress in paying off our mortgage – it’s still discouraging to see just how much we spend on INTEREST.  Man, I cannot wait until the day when we own our home, free-and-clear.  Until then, we keep working the plan.

I plan to file in the next couple of weeks and will have any refund or payment automatically deposited or debited from our online checking account.

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Save Money When Eating Out

My wife and I have 3 kids.  We prefer to feed them home-cooked meals, but there are times when it’s fun and/or convenient to eat out.  Here are a few ways that we have learned to save money when eating out – with kids!

Budget for eating out.

This is critical.  Folks often underestimate how much they are going to spend on eating out – and run into problems at the end of the month.  If you are going to eat out – you gotta budget for it.

Order an entree – and ask for an extra, empty plate.

Instead of ordering from the kids’ menu – which usually has a limited selection – order a regular entree and have two kids share it.

Use a coupon.

Coupons are cool, now, right?  Cool or not, they help us save money, even at restaurants.

Research discounts.

Some places have “kids eat free” night or have special offers, depending on the time of day you eat.  When our kids were smaller, we would eat dinner rather early, and benefited from early-bird specials.  (We are totally going to rock as retirees.)

Drink water.

Skip the soda and tea and stick with good old water.  It’s healthier and – usually – it’s free.

Do your own thing.

When eating out with other families, it can be tempting to “go with the flow”.  Stick to your game plan.

Skip the bun.

If you are looking for a low-carb option and can’t find one on the menu, ask for a burger or grilled chicken sandwich without a bun.  In many restaurants, you’ll get your low-carb fix – and they will charge you less than the cost of the regular sandwich.  Just ask.

Learn to love the humble side salad.

In many chain-restaurants, the side salad comes in a huge bowl.  Elaine would be proud!  My kids and I love salad – and we are often full after eating just a side salad.

Do a little combo vs no-combo math.

This one is a bit nerdy, but it’s worth doing, especially if you routinely eat at the same fast food places.  Take a few minutes and calculate whether buying the combo is a better deal than not buying the combo.  In some circumstance, it’s actually cheaper to order items individually – especially if you are drinking water (and avoiding fries!).

Skip dessert.

I love sweets, but I have learned to avoid them.  I’ve read several articles on the Internet (and if it’s on the Internet, it has to be true…) that it takes several minutes before your brain realizes that your stomach is full.  Eat slowly, enjoy each bite, talk to the kids, and allow your brain and stomach to communicate.  With kids, it’s important to decide before sitting down whether dessert is an option.  (I’m not a fan of using food as “reward” – especially rewarding a “clean plate” with dessert.  Food is fuel – awesome tasting fuel – but fuel.)

Check your bill.

Make sure that you are paying for what you actually ordered.  This is also a good time to talk real life finances with your kids!

Eating out doesn’t have to break the bank.  With just a little planning and smart ordering, we have learned to save money when eating out with our kids – and you can too!

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Paying Off Mortgage Progress January 2013

My wife an I are working hard to achieve our goal of paying off our mortgage early.

As of February 2013, my wife and I will have lived in our new home for 3 years.

We have a conventional, fixed-rate, 15-year mortgage.  We recently reduced the interest rate on our mortgage.

Our goal is to pay it off our mortgage in less than ten total years.

As of February 1, 2013, we will have made 35 regular, monthly mortgage payments.

We have also made several additional principal-only payments, too.

We make our monthly mortgage payment by the first day of the month.

Additional principal-only payments are made throughout each month, as we earn additional income and find ways to decrease budgeted-for expenses.

Here is our most recent chart -

Paying Off Mortgage

The chart shows two percentages:

The blue percentage is how much I still owe – the balance.

The red percentage is how much I have reduced – the paid.

Now that we have lowered the interest rate on our mortgage, a larger percentage of our regular monthly payment will go towards principal, which rocks. Also, if we continue to make our old payment, we’ll pay of our mortgage even sooner, which rocks, too!

We are still sending extra, principal-only micro-payments.

Unlike credit card companies, our mortgage provider does not apply micro-payments throughout the month.  Payments are processed on a single day.  We believe in  a “hands-on” approach to debt reduction.

This cart simply reflects how much of our mortgage balance we have paid – not how much we actually own.  That percentage would be much higher.

We have made 35 regular payments and have lived in the house for a little more than two years. Our contractual remaining term is 12 years and 1 months, but our actual remaining term is 11 years and 8 months. We have reduced the length of our mortgage by 5 months!

View all post related to our mortgage payoff progress.

Side note:  Our goal is to own our home, mortgage-free.  When we first moved in, there were several houses for sale in our neighborhood.  As of today, those houses have sold and we feel great about the value of our home.  We live in a rural areas, so prices are relatively stable.  We also contribute to retirement.

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Monthly Money Plan

As part of my ongoing efforts to Simplify. Everything. – I have reworked our monthly money plan.

Our monthly money plan details our strategies for managing our household finances.  The money plan is very similar to a budget – but it also incorporates the use of a calendar and a filing system.

I like for things to be organized.  Our monthly money plan keeps us on track, moving towards our main goal, and in control of our finances.

Our Income Sources -

My wife and I both deposit our monthly paychecks on the first day of each month.  This is our regular income.

I also receive money for various part-time work.  This is our irregular income.

Our Budget -

We use a very basic zero-based budget to manage our regular income.

Irregular income is used to create a secondary budget – for things like vacation planning, reducing our mortgage principal, and longer-term savings goals.

Our Big Goal -

Currently, we are working to pay off our home mortgage in less than ten years.

Our Monthly Money Plan -

Step 1 – Paychecks are deposited at our local bank on the first day of each month.

Step 2 – Cash for monthly expenses is placed into our envelope system.

Groceries for us and gasoline for our automobiles are purchased each Monday – using the cash from the envelope system.

Step 3 – Bills are paid.  It’s very simple to locate and pay these bills.  They are either bookmarked in my web browser for easy access – or in our bills to pay file folder.  We pay our bills online via our primary checking account.

Step 4 – Paperwork associated with bills is filed.

Step 5 – Deposits, withdrawn from our primary checking, to our online savings account, are scheduled.

Step 6 – Deposits, withdrawn from our primary checking,  to our Roth IRAs, are scheduled.

Step 7 – Extra, principal-only payment is made to our mortgage provider.  Click to see our debt reduction progress!

Step 8 – Irregular income is deposited, as received, into our online savings account.

Step 9 – Budget needs for the upcoming month are discussed and budget is updated.

Step 10 – Mid-month and again at the end of the month, I check to see that all payments have been received and deposits have been credited.

Step 11 – Charitable donations are made.

Step 12 – We balance our check book.  This takes about two minutes – because our bills have all been paid and we use cash and debit for 95% of our off-line purchases.

Once a Quarter -

I check on our retirement accounts and make any adjustments that I feel are necessary.

Once a Year -

I review all insurance policies, to insure correct coverage and good rates.

That’s it. That’s our monthly money plan.  We make deposits, use cash, pay our bills, work hard to earn a little extra now and then, build our savings, and reduce our debt.  It’s very simple and very basic – and it works for us.

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