Scared of Money

This is about getting the most out of life for the least amount of money. And doing it with a bit of style.

Saturday, March 25, 2006

Rock Star Lifestyle on a Dime - Flights

Everyone knows about the good travel Web sites such as Kayak, Priceline and Travelocity for Web fare. But what many people don't realize that what truly matters is the day you buy your flight. Wednesday is the ideal day to purchase a ticket and if that doesn't work, purchase your ticket on a Tuesday or Thursday. Why? Airlines recognize that most business trips are purchased on a Monday and most personal trips are purchased on weekends. Once you find the flight you want on Kayak or Travelocity, visit the airline directly to purchase your flight so you cut out the fees from the middleman (usually $5 a ticket). I also adore TravelZoo, which is a weekly e-newsletter that sends you the top 20 travel deals of the week. Phenomenal bargains.

Some other good tips I have heard:
  • If you're just looking to get away for a weekend and you are flexible on timing and where you are going, check airline's Web sites on Wednesdays for that weekend where most will have drastically reduced weekend fares available.
  • Take advantage of overbooking. Volunteer to give up your seat if needed when you check in. Monday morning and Friday afternoon afternoon flights have the most potential to be overbooked.
  • If traveling to Europe, fly into London and take a low-fare airline to your final destination. London tickets are by far the cheapest and always have the best sales.

My best deal to date? A friend found flights from Chicago to Madrid for $89 dollars on British Airways, which is where we went for spring break senior year. They accidentally left off a zero off the end : ) The best part is that they were overbooked on the way back and they put us into business class. I wouldn't hold my breath waiting for that to happen but Travelocity lets you create fare alerts in case that should happen again.


Link

Thursday, March 23, 2006

Sheep Syndrome

One of the biggest obstacles to controlling my spending is that I totally have sheep syndrome. I can't stand being left out. So if my friends are going to a concert that I particularly don't want to go to, I go anyway. Because I can't stand the idea of everyone having fun without me. It gets expensive. I find myself doing (mostly purchasing items) that I shouldn't because I don't want to feel like I'm the only one not doing it or not owning it. It's a little out of control because if I really want it, I buy it.

It's not something easily controlled. However, you only covet what you see and are around so I try to limit my exposure to expensive shops or magazines that will only encourage me to buy. I live in a separate city from all of former college friends, which helps a lot. I miss them tons but they are in a totally different income bracket than me -- engineering, sales, accounting, etc. So they live a different lifestyle than I can afford and the temptation would be too much for me. But visiting them can be very expensive.

Reading The Millionaire Next Door helped me a lot too. It helped me realize that a lot of people live beyond their means and that what I really might be envious of is credit card debt (when I have none). How does everyone else deal when they want things they can't afford?

Thursday, March 16, 2006

Caveman Have It Better Than Me

I don't spend a lot of time on my good choices, but here's one way I save money. I live like a caveman. Seriously.

I don't have...

A TV
Cable
Internet
An iPod
Digital Camera
DVD Player
VCR
Netflix

I've never had cable. Ever. I use my apartment's business center for Internet (and blogging). I listen to the radio. My friends send me their pictures. Not only do I not download iTunes, I have probably bought 5 CDs in my life. I gave up TV in May 2005. And I don't miss it. If I want to watch TV, I have to workout at the gym in my apartment. I usually drive to my sister's on Sundays to watch Grey's Anatomy. Eventually, I might breakdown and get a TV again, because it's hard to keep up with the news if you don't have one. And if I don't do that, I might buy a portable DVD player because I miss watching movies when I don't go out. I have a cell phone but not a land line.

It's not that I don't want these things, but living under your means (or trying to) is about making choices. And technology isn't high on my priority list. Call me crazy for speding $165 on highlights and a cut every two months. But I think it's absurd to spend a $100 a month (at least) on Internet and Cable. To each his (or her) own : )

Rock Star Lifestyle on a Dime - Hotels

I'm a big fan of pretending to live like a celebrity (a little too much so). But I have always believed that if you pay full-price thatyou're paying too much. Growing up as a child, we traveled a lot and my Dad would find the most amazing deals. This was before the Internet,which made it even more amazing. : )

When I travel now, I always try to use Priceline for hotels. Using Priceline, can be a little haphazard for purchasing short-trip airfare since you have no control when you are leaving. It rocks for hotels though! I've gotten to stay at the Swissotel in Chicago, Hyatt Regency in Chicago and the Vail Cascade Resort all for under $90 a night. That's practically cheaper than Motel 6. Most people are too scared to not know where they are staying, but you justhave to be careful and do your research. They let you pick the stars of your hotels and let you choose the area. But make sure you really know the area first. My sister got stuck in the suburbs of Chicago because she didn't know what she was doing, and she won't try it again.

Also, MyMoneyBlog had a good post on getting a Starwoods Preferred Guest American Express Card that canhelplyou save on hotels and flights. A little fun trick is that if you useTravelocity enough, they will send you a complimentary StarwoodsPreferred Guest Loyalty Card (late check out, no lines when checking in, etc.)

Any other suggestions? I think I may do a series on these topics. I'm clueless at personal finance but excellent at finding bargains.

Slainte!

Jane Dough'sposting got me excited for my favorite holiday! St. Patrick's Day! Andthe best part is my work is having a celebration (which I'm in chargeof) so Irish Coffees all around. We have half day Fridays too so thiscan mean a long day for me tomorrow. : ) I'll have to keep my drinking(and therefore spending) in check.

Tuesday, March 14, 2006

Dress For The Job You Want

After a great job sticking to my new budget, I blew it. I totally lack self-discipline. I stopped at some outlet stores coming back from a ski town close to where I live. I left with (1) pink Ralph Lauren button down, (1) Banana Republic cream eyelet jacket and (1) Banana republic sheer button down top thingy for a total of $150. All items were very marked down and are totally work appropriate.

As I've mentioned previously, I can justify ANY purchase to myself. How did I justify this one? I REALLY need more "grown-up" clothing. I tend to push the casual envelope at my office a little too far. I don't think it's hurt my career but I do believe "Dress for the job you want, not the job you have" and "Look good, feel good." So this is a professional development expense, right?

FICO

Last week, I decided to go off my saving spree and check on my FICO score. In May 2005, I had a borderline crappy FICO score (600 something?), and was considered a credit risk by my apartment company. I had to pay an extra month's rent (ouch) to get into my apartment. I did a little bit of research and found out I had an unpaid bill. In 1999, I broke my leg two weeks after my 18th birthday (otherwise it wouldn't have mattered). My mom and the insurance went back and forth for a couple of months but I thought it was taken care of in the end. Turns out some $30 bill had never been paid. I paid it immediately but it still took its effect on my FICO score. I also had a credit card bill that went unpaid past 30 days in 2001. I wish I knew how important that score was back then.

I checked back again in November and my score went up to 750. I checked again last week and I'm at 772! YES!!! Finally, my financial responsibility has something to show for itself. The cast was so old it finally went off my credit report. I want to buy a condo/house in the next year or so, which makes this score really important. I have two more years until the credit card bill falls off. Any other credit report tricks?

Tuesday, March 07, 2006

Borrowed Time

More on spending philosophies...

Live life today and put off saving or ensure you don't have to worry about retirement? This is a great discussion traveling around the blogosphere. This again reminds me of my parent's spending philosophies.

In October 2004, my Mom passed away from cancer. She had a prolonged illness that lasted 5 years. Not once did she have to worry about about not working, paying her bills (medical or otherwise) or making sure that my sister and I would be fine. Her life long frugality paid off in the end and gave her great comfort of mind to know that she was ok financially.

During that same time period my Dad took a trip to Europe that he simply couldn't afford. He paid for it with his credit card when he should have been saving for retirement. He had been living beyond his means since the divorce 5 years before. Three months after my Mom passed away I got called at work by my sister to let me know that my Dad was in the ER for a bladder infection. I talked to him and he was fine. An hour later I call back to learn he has had a massive heart attack. He didn't make it through the night.

I'm so glad my Mom was ok financially during her illness and my Dad didn't wait until he retired to take that trip to Europe. Their decisions worked out for them in the end. In my life, I want to be able to enjoy life now but never have to worry about financial stability.

But ALWAYS at the back of my mind is the fact that we are all on borrowed time. There is no guarantee that you will wake up to enjoy tomorrow. Young and healthy? Me too. Death doesn't care. Life is like a two-lane highway and the line keeping us from death isn't as powerful as we believe it is. An SUV easily crosses over and we will fail to exist.

Morbid? Yes. But true. You don't have to blow $1,000 on dinner to get the most out of life but if you're on target financially, make sure you don't turn down experiences that you will regret later. I save for retirement so I can enjoy life later but I also grab every chance I get to enjoy it now.

Spending Philosophies

MyMoneyBlog had a great post on whether to have joint or split accounts as a couple. I'm a singleton but it totally made me think of my parent's money philosophy. My parent's had a joint account but had "allowances" where they set a small (and equal) amount of money into their own bank accounts for personal spending. My Dad (big spender) and my Mom (extremely frugal) never felt like they had to justify their expenditures to each other. Plus, my Mom was a stay-at-home Mom and my Dad wanted her to feel like she had her own money that she felt comfortable using. My Dad's father made his wife ask for permission for every little expense and belittled her for her spending purchases. It's a model that I think I want to reflect in my own relationship someday.

The whole post got me thinking about my parent's spending habits. I think being at extremes made them have a really balanced life together. We had nice things, a great house and expensive vacations but Mom always bought our clothes on sale, we drove our cars for 10 years until they died and my Mom did a lot of DIY projects. Sure there were fights. "Seriously we don't have to wait until the dish towels go on sale. We can afford full-priced dish towels." That was a memorable one. When I was 18 and applying for financial aid, I was stunned to find out how much my Dad really made. My parents really made the dollar stretch and it led to a great middle class lifestyle.

When my parents got divorced, they went to their extremes. Dad bought something new every day, took me out to fancy restaurants, he kept our house, etc. Mom bought a much smaller house, we didn't even go out to Wendy's, she bought her new furniture second hand, etc. While I think it's hard for couples with different financial strategies to make things work, there is something to be said for balance. You just need to be able to compromise.

Monday, March 06, 2006

I HEART U.S. Weekly

I adore celebrity gossip. Really I wish I didn't care who wore what, who hates who and who is sleeping together. But I do. A lot.

To feed my addiction, my sister got me an expensive subscription to U.S. Weekly but in reality, by the time I get my mag in the mail, I already knew all of the scoop. A frequent tip I've seen on cutting down on costs is to get rid of subscriptions. As long as you don't end up paying newsstand prices, you can probably save a lot. I have an out of control reading habit but I save on my subscription costs by ALWAYS choosing the longest line at the grocery store to catch up, going to Barnes & Noble and reading their magazines cover-to-cover (and then I leave), taking advantage of my public relations firm's massive subscription list, reading all of the free electronic media and taking my neighbor's newspapers at the end of the night (I know, I know it sounds like stealing but I only take a copy at 9 pooh and only if there are several papers left in the basket.)

In the end, I only end up having four subscriptions -- Cooking Light, Cook's Illustrated (gift), 5280 (free when I joined the Art Museum) and U.S. Weekly (gift), but if I paid for everything I read it would be like $700 a year. Just some inexpensive ways to keep up with an elaborate reading list.

5K, 24 K, 401 K

Of all these K's, the only one I have a true affinity for is 24 K. Preferably in the form of white gold jewelery. : ) However, I recently had my six-month review and got a raise so I'm going to up my 401 K contribution from six percent to seven percent. It's not much much but it's a start. I'm not really going to miss that one extra percent. Plus, I LOVE the feeling of ensuring the IRS isn't getting anymore of my money than necessary. Take your grubby little hands off Uncle Sam! That's money for my second home right there, preferably somewhere in Tuscany. Ok, ok, so I'm going to need to contribute more than one percent to get a villa in Tuscany but you can dream right?

Saturday, March 04, 2006

Insufficient Responsibility

Last weekend, I went to this cute little mountain town about 6 hours away with two co-workers to sit in the hot springs. I was really proud of myself because we kept costs down to a minimum. We stayed at my friend's brother's house, we went to cheap restaurants, I didn't buy souvenirs, etc. We did stop at the outlets and I told myself I would buy something ONLY if it was truly a good bargain and I really needed it. I walked away with a pair of classic black Banana Republic pants for $35. Not bad.

A good start to being financially responsible, right? Not so much.

I got home and checked my mail and found an insufficient fund notice from my bank. So I check my online bank account and found FIFTEEN insufficient fund notices. For which I got charged $28 a piece. For a grand total of $420. I forgot about this huge check I wrote that got cashed while I was on vacation. I tried not to think about it but then I thought about all these Coach purses I didn't buy at the outlet and realized I could have bought TWO Coach purses for this amount. I almost died.

Deep breath...I called my bank and they agreed to take two of the charges away. I pushed for more because most of those debit charges were $6 and under and I've been a really good customer. In the end, they agreed to take away 6 of the charges. I was hoping for 8 but it's still a good deal. An important lesson I've learned is that you can always ask and the worse they can say is no. But I'm still mad at myself because I thought I was putting these stupid financial mistakes behind me. So now I'm going on a "saving spree" which is a term I learned about from Savvy Saver.