1 Million Dollars

Tuesday, May 31, 2011

How to Save Money While Flying

Flying is just getting more and more expensive, but what can you do if you need to travel far? Personally I have found southwest and jetblue to be the cheapest for airfare but still check Kayak.com just in case there is a great deal. Sign up for southwest and jetblue tweets and check them before booking, because a lot of those deals cannot be beat. Before deciding on what flight to go on, check for baggage fees. It may be cheap to ship your bag via fedex/ups/usps or go with the slightly more expensive airline that has free check baggage. Both southwest and jet blue have free check baggage (jet blue allows one free bag, southwest two). Other airline, like Hawaiian, may charge for the bags, however they may allows you to check in online and pay less.

Once you have found the cheapest rates for flying are there still other ways to save money? Sure, there are. You can bring a empty water bottle or travel mug so you can refill it with water once you are inside the security check point. You should also bring snacks like fruit or granola bars to snack on and avoid paying the crazy prices at the airport. Bring a book or ebook to read so you do not get tempted to buy anything at the shops. My DH and I did that but I read all the books I brought during the flights to San Jose and to Hawaii. However, we happened upon a used book store in Hawaii and bought a couple more for the trips back to San Jose and on to Buffalo.

If you are flexible let the gate attendants know they can bump you and you can get credit towards a latter flight. They may also give you food credit or a night at a hotel room depending on the wait for another flight. This does not always work, it worked once for us but the last three times I have asked, it has not worked. Do not rely on it.

Monday, May 30, 2011

Frugal Movie Watching

During the summer some of the best movies come out, yet at ten dollars per ticket, how can people afford to go? My DH and I afford it by finding the cheaper theaters (here AMC Theaters is cheaper than Regal Theaters), by going at the matinee time and by buying AMC gift cards online for a discount.

On plastic jungle AMC gift cards are 18% off so we were able to get a twenty-five dollar gift card for twenty dollars and fifty cents. You may be thinking all right, you saved four dollars, big deal. First, that four dollars can add up quickly over time and second I am not done yet. My DH and I go to matinee movies at AMC for four fifty per person instead of regular priced movies for nine dollars or going to Regal for nine dollars and fifty cents. We do splurge and get popcorn at the theater, though.

Let's add it up then, shall we? Normally tickets cost nine to nine fifty a person, so eighteen to nineteen dollars for my DH and I plus popcorn at seven dollars for a medium adding up to twenty five to twenty six dollars. By using the matinee at AMC and getting the gift card we only spend thirteen dollars and twelve cents. That is a savings of almost fifty percent and we get the same movie experience.

Being frugal is not about giving up your fun but finding the best way, financially, to have that fun.

Saturday, May 28, 2011

Frugal and Busy Summer has Begun

Summer has just started and I am sure I will not be bored this summer. There is so much to do, both fun and work to do. A ton of fun movies, such as Thor have come out and will come out this summer, the yard sale season is just starting, I can actually work in my garden after some false starts and most importantly I can workout outside again.

I have decided to get in shape this summer, without spending any money, let's see how well I can do. I will be posting every week on how well I did, to keep myself on track. My goal is to stop gaining weight and get some muscle back in both my arms and legs. I stopped working out consistently after I hurt my neck a few years back and have wanted to get back into it, without hurting myself, for a long time.

I am going through our Stuff this week and deciding what to sell at our yard-sale next weekend, if the weather is nice. Because of some lovely gifts from our wedding we have upgraded our stuff and can get rid of some "college" stuff. Most of the stuff we are selling will be Stuff we either no longer use, like some books or some Stuff we have upgraded.

We are going to have some serious time in our garden, leaving for two weeks had allowed the weeds to take over. The only things already planted and living are two blackberry bushes and the apple tree, I have managed the kill two basil plants this year, for some reason.

We do plan to do some repairs around the house as well, like painting the stairway, and the bathroom as well as some other minor stuff. I do not expect that to cost too much, but I have learned that repairs normally cost more then is planned.

We are using discount giftcards bought from plastic jungle and cardpool for any expenses this summer that we can for example home depot and amc theaters gift cards, which should save us 5-10% on those purchases. All in all, I think this summer will be crazy busy, frugal and fun.

Tuesday, May 24, 2011

My Plan for Emergencies

Depending on where you are at life, an emergency may have a different definition. As a student it may be student loans not coming through or parents not paying the amount they said they would. To some students a job lose is not an emergency because student loans and/or parents are paying for their expenses. However, some students are working and going to school and may rely on their wage, I know I did. But when I was working outside the school loosing my job did not affect my schooling and vise versa. For my fiance who had a scholarship in undergraduate and a fellowship now school and income are intertwined. That makes emergencies a different beast. It does mean he has a more secure job but if something goes wrong it will be worse for him than it was for me. Both now and then I had an emergency fund but honestly it does not feel like enough. Do you really want to worry about the money slipping through yours fingers when you are trying to find another job? What happens when multiple emergencies happen? It just eats away at the emergency fund and your three months of savings is now a month. I do not think house repair, car repair or any replacement funds should be included in your EF. They should have their own fund. My EF is for loss of income, nothing else. This way if you need to replace a car battery when unemployed your EF will not be drained down.

Even as a student, people should have multiple streams of income. Maybe it will be scholarship and work or maybe you would consider student loans in that mix but never rely on one stream. I think this is going to be the biggest change about our generation compared to the previous generation. We know our jobs are not stable so we will have more than one income source. By having more than one income source, if one disappears it is not as life changing.

However, as you start out you will have one main source of income and you will need something to rely on when that source fails. Note, I did not say if, I said when. There is no stable income, state and federal employees were taking furloughs and private sector employees get laid off all the time. So what can you do?

Personally, I am working on getting my alternative sources of income up. When we purchased our home, we bought a duplex. We looked at duplexes where the rent would cover our mortgage, property taxes and insurance. Now that we have a renter, even if my fiance looses his job our home is secure. But what about everything else, food, clothes and most importantly health insurance? Do you know how much you (or your parents) are paying for health insurance? Does that amount cover the full cost or just a part?

When I aged out of my mother's insurance I could not find any health insurance that would cover me, even with a huge deductible. I had to COBRA my mother's health insurance at over $500 per month. On the other hand, my fiance was able to get a high deductible plan for under $150 per month. Now to COBRA our current coverage it would be almost $600 for both of us. This cost must be added into your emergency plan because you cannot guarantee that you can find health insurance other than COBRAing your current health insurance.

So at this point if I lost all income I would need $2147 per month, if I cut away the fat from my budget. For a minimum emergency fund I would need $6441 (3 months). Because my tenants could leave at the same time that my fiance loses his job I keep my EF at least this high. However, that extra $525 a month could help stretch my EF to almost 4 months. I personally would not be comfortable with such a small EF without the extra income and his very secure job. He has a contract with his PI (primary investigator) as well as the department and the college.

Also, I work as a server, it took me less than two months to find a job, maybe not exactly what I wanted but one advantage to a low skill job is it is easy to find another. We do not count my income in our budget, last year it went towards the wedding and this year I am taking classes so may not have the time to work. In addition we have two extra rooms we could rent out, though we do not want to. The best time to rent room is August (for students) or April/May for summer school. We do not depend on that in our EF planning though it is an option.

What else can we do as part of our EF plan? I am looking into mystery shopping for when I am not taking classes. We are saving like crazy for our next move in three years. We have a car fund, a house fund and a replacement fund. Those funds should deal with any minor "emergencies" so we can work on a plan for the major ones. We are going to buy another duplex but that will probably be some time from now. I have started being an occasional research subject at the university for a little extra money for our EF. We also plant a garden to stretch our food budget, this will help if we cannot afford groceries. At some point I hope to also get some income from the blog but that has not happened yet. Anyone else have ideas for other sources of income?

For students time is the greatest hurdle in making multiple streams of income. Students need flexible jobs that allow time for studying and classes. I found that combining serving with an on-campus job was the best. Over the summer is the best time to juggle multiple streams on income and make the most income. You will notice an increase in my work on this blog during the summer as well. I do have one guest post coming out in June and will be trying to get another guest post for both July and August. Work will pay for my classes next semester, the other streams will add to my EF as well as my retirement fund.

Life Gets in the Way of Blogging, in a Good Way

I am now a married woman, my DH and I went back to California for our wedding and then on to Hawaii for a cruise. It was lovely and a big thanks to my mom for all her help but it is now time to get to real life. Time to change beneficiaries on our investments, finish my DH's disability insurance paperwork, and get back to the frugal lifestyle. I admit we splurged a lot in Hawaii but it is a memory I will have forever. Also, part of the reason for being frugal is so that we can splurge on things/events important to use and our wedding and honeymoon were very important to us.

We are planting the garden this weekend, and getting back to work tomorrow. We have a list of chores to do around the house, just like normal. I do wonder if I will feel different as a wife but at least now it just seems like life.

Monday, May 9, 2011

My Frugal Weakness

My biggest weakness is food. It is funny when I was young I could care less about what I ate. I would either eat or not, I did not care. Now, I want to eat well and I even want to eat healthy food. We spend almost double at the grocery store compared to last year but we do not want to go back. Back then, we had enough food for the week and that was it. If something went wrong, we had nothing. We ate badly, for example, I do not think I had a piece of fruit for six month.

Now we eat salad on average of two nights a week and eat at least a piece of fruit a day. We also eat more expensive "treat" dinners. And this is where the problem occurs. When a dinner costs ten dollars, it does not matter if it is at home or at a restaurant, it is going to kill your budget, if it is done too much. But those are the dinners we like the most. What can we do to enjoy our meals without paying the price?

We have shopped sales, used coupons and even had a small garden last year, what more can we do? I have decided eating health is more important than saving money but I would like both. If I do not buy enough food at home that I like, I normally end up going out to eat and that adds up as well. So I am still struggling with this, and may be for some time.

Thursday, May 5, 2011

Update on grocery savings plan April

My average for April was $43.23 per week and am down to $50.80 per week for the year. If I get my average down to $50 versus the $50.80 I will save an additional $41.60.
I am doing better than I expected but I was out of town for a week and that did help. Doing so well this month means I only have to keep my budget below $49.50 per week to reach my goal of spending less then $50 on average per week. That is more than I thought I we be able to spend, coming off March.

However, I did not start my garden because of a late snowfall. I will be starting this weekend. I did grab a basil plant and eating fresh basil has been lovely. We need to plant lettuce, tomatoes, cucumbers, cilantro, red onions and jalapenos. I cannot wait till the apple tree and blackberry bushes start giving off fruit. We consider the garden expenses part of our food budget so that may increase our expenses this month we expect to save some money by gardening.

I am swinging by the WIR grocery hounds a little more than I used to, especially with Wegmans deciding to only change their sales every other week. This means I do not have to check the blogs for Wegmans except every other week. This will save me some time but I wonder if it will end up costing me some money. Tops Market has not had many deals in the last two weeks but the two weeks prior it had quite a few. The ebb and flow of deals is to be expected and that is why I stockpile when I can.

By reaching out to others this lifestyle change is easier than I thought it would be. We still struggle with this change but it is not as hard as I thought it would be.

Tuesday, May 3, 2011

Term Life Insurance

There are two types of life insurance, term or whole. For most people term insurance is the way to go. The only exceptions come about when you are bringing in a lot of income and have maxed out your 401k and IRAs. But for young people, I do not think any of us are in that boat so I am going to focus on term life insurance. Term life insurance is misnamed, it should be named income replacement insurance.

Term life insurance comes in different amounts of money ($100,000 to $1,000,000) and for different terms (10-30 years). The cost starts lowest for the lowest term and amount of money and increases as you increase either variable. The benefit for getting the longest term is the rate won't increase for that term.

Often people can get a small amount of life insurance through their employer for free and larger amounts for pennies on the dollar. My employer gave $20,000 for free and an extra $1000 for every .10/week. This means $5.20 for every $1000 extra you would want per year. However, I did not take advantage of any extra life insurance through my job. You may be asking, why? My fiance and I both work, we live on my fiance's income (the higher salary) and bank both mine and the rental income. Given that term life insurance is suppose to replace the income of the provider I do not need any. We could hypothetically self-insure for my burial if my work did not provide the $20,000 free life insurance.

Now in my fiance's case, I am dependent on his income so he should have life insurance. On the other hand, I do have both my job and the rental, so I could survive without his income, though it would be tight. This would change if I got pregnant or started graduate school. We also determined that after graduate school my fiance likely would have life insurance through his job and therefore we would not need a long term. Considering all of this,if we chose to get life insurance, we would choose the ten year term and probably the lowest amount that we could get ($100,000).

While we were checking out disability insurance we checked out term life insurance for both my fiance and me. The cost would be between $100-$150 per year for either of us. We could get life insurance for both of us, and disability for just $50 more than I expected to pay just for disability. Though that is amazing I do think we will wait until we need the insurance and for now just add more money to our Roth IRAs.

Sunday, May 1, 2011

Update on the millionaire goal- April

As of May 1, 2011 I have $9780 in my investment account. I am $220 short of having $10,000, my first step in my millionaire goal. This month I will be depositing $219.75 into Fidelity. This income will come from our rental, $200 and the 2% reduction in social security $19.75. I am considering just putting in the extra twenty five cents just to hit the $220 and reach $10,000 this month.
The remain $50 (or 49.75) I will now be putting towards my fiance's disability insurance payment. It looks like we will have the disability insurance paperwork finished by the end of the month and we will have a new annual bill of $360. We will begin to look for life insurance in a few months.

It looks like I should have $10,000 (if the markets cooperate)by May or June of this year. I plan to increase the amount going to the IRAs once we save enough for the disability insurance and life insurance. This should be in two months, July of 2011.

My next minigoal will then be $25,000 where I can stop investing in target date funds and diversify myself using mutual funds. It looks like I will be able reach that goal in three to four years once we increase the amount going to the IRA.