The Frugal Student now has money at Vanguard. My 401k rolled my money (about $4200) into a IRA without my consent or knowledge so I responded by contacting Vanguard and initiated a rollover. It took over a month and a three way call with Vanguard and my old 401k provider to finally get them to give my money up. I am very happy to be at Vanguard, though and will be started back up with my millionaire updates starting this month.
I chose Vanguard because of their low fees (.18% for my current account), but had avoided them until now because of their high minimums ($3000/account) and because Fidelity has a credit card which deposits 2% of my spending into an IRA. Right now those credit card rewards are going into my husband's Roth IRA, and is the only retirement savings we have. Once we are saving again, my husband Roth IRA will be moved to Vanguard as well, and I will open a Roth IRA at Fidelity to take continue to take advantage of the rewards, for as long as they last.
However, none of the money in my new Vanguard IRA will get added to which may in the future limit me on my IRA contributions and I may later decide to move that money to Fidelity. The money in my 401k, and now in the Vanguard IRA was money set aside prior to my marriage, and therefore is all mine. Well, as long as I do not add one red cent during my marriage. Therefore I plan to keep that money separate from any marital assets. Some people may say I am planning for my marriage to fail, but to that I say, I get life insurance and disability not because I expect to get disabled or to die in the ten years, but to cover me, in case it does. I came into the marriage with assets, my husband with debt, why should I not protect myself. I could have done a pre-nup, but since most of my assets were in retirement accounts, why not just use the little legal trick and not add to those accounts? A pre-nup can be set aside by a judge, keeping assets apart can't later be joined by the judge.
For those who are frugal students, don't lose the benefits of your frugality when you get married. Protect yourself, and if your future spouse loves you, he or she will want to protect you too. I know my husband was willing to sign a pre-nup before we got married, he even brought it up. He benefited from my frugalness, but he did not want to take advantage of it. And, to me, that distinction is important.
1 Million Dollars
Tuesday, February 26, 2013
Tuesday, January 29, 2013
Frugal student has added a new hat!
The frugal student is now a frugal mom of a precious newborn baby girl. So I have added another angle to my life and another "hat" as one of my favorite blogs, http://www.4hatsandfrugal.com/ calls it. I now am a student, a landlord, a wife and a mother. Let the craziness begin.
I do plan to take a page from another favorite blog, http://www.budgetsaresexy.com/, and track how much I spent and spend on the baby. I do also plan to include some of the eating out during the pregnancy, since normally I just would have gone home. Look for the first post of that series soon.
I've learned a lot over this pregnancy and my time in the hospital. Prior to this I was like so many of financial blogger, planning down to the last penny. Well, I have figured out that does not work when it is not just you,especially when you are in transition. When you are in transition, having flexibility as well as a budget seems to be key. So is savings to be honest. We did not have flexibility in our savings because I thought I had figured all that I needed and I found out I got into graduate school a few days before I found out I was pregnant so not much flexibility there either. So how did we make it work? Well, we got creative and we asked for help.
I let people know that we planned to shop at consignment stores, so they knew we would take used items. A professor who had just finished having kids heard and gave us a lot. Obviously I also did shop at the consignment shop as well as craigslist and got some great deals. Also, we took help when it was offered. One of my friends threw me a baby shower and my husband's family did the same when he went back to their area for a conference. We received a bunch of things we had already budgeted to buy, as well as other useful items we would have never thought of. This, thankfully, gave us some flexibility, which we definitely needed because we missed a lot of things, including not planning for an insurance miscommunication which cost us over $100. Also, once I got into graduate school, I knew that we would get a federal tax break on my tuition costs. I added it up and realized that I could add an additional exemption for 2012. This gave us some higher cash flow during my pregnancy, instead of a large refund in April. You might wonder why I don't expect to get my refund earlier than April. I have classes, my daughter, sleep, lab work, a rental to list and show in March and April as well as this blog to do. I have inputted some of our tax information but we do have a lot between both my job and my husband's, the rental, the interest payments (consider a high yield checking if you have an EF) and our tuition expenses. I also have to keep up with regular bills. Taxes will probably end up on the backburner for a little while. If I have extra time, I'll do them early but I won't plan for it.
I have discovered that being a college student and then having a kid comes with a strange benefit. College students are used to running on low sleep for short periods of time. My husband and I have been catching cat naps of 3 hours at a time and are still coherent a week later. Since he is back at work already, I kicked him out of the room last night so he could get a full night sleep, and he will spell me this weekend. Hopefully between the two of us, we can keep in up for the six months it takes for little ones to get better at sleeping at night.
So that is what is up in the crazy life of the frugal student.
I do plan to take a page from another favorite blog, http://www.budgetsaresexy.com/, and track how much I spent and spend on the baby. I do also plan to include some of the eating out during the pregnancy, since normally I just would have gone home. Look for the first post of that series soon.
I've learned a lot over this pregnancy and my time in the hospital. Prior to this I was like so many of financial blogger, planning down to the last penny. Well, I have figured out that does not work when it is not just you,especially when you are in transition. When you are in transition, having flexibility as well as a budget seems to be key. So is savings to be honest. We did not have flexibility in our savings because I thought I had figured all that I needed and I found out I got into graduate school a few days before I found out I was pregnant so not much flexibility there either. So how did we make it work? Well, we got creative and we asked for help.
I let people know that we planned to shop at consignment stores, so they knew we would take used items. A professor who had just finished having kids heard and gave us a lot. Obviously I also did shop at the consignment shop as well as craigslist and got some great deals. Also, we took help when it was offered. One of my friends threw me a baby shower and my husband's family did the same when he went back to their area for a conference. We received a bunch of things we had already budgeted to buy, as well as other useful items we would have never thought of. This, thankfully, gave us some flexibility, which we definitely needed because we missed a lot of things, including not planning for an insurance miscommunication which cost us over $100. Also, once I got into graduate school, I knew that we would get a federal tax break on my tuition costs. I added it up and realized that I could add an additional exemption for 2012. This gave us some higher cash flow during my pregnancy, instead of a large refund in April. You might wonder why I don't expect to get my refund earlier than April. I have classes, my daughter, sleep, lab work, a rental to list and show in March and April as well as this blog to do. I have inputted some of our tax information but we do have a lot between both my job and my husband's, the rental, the interest payments (consider a high yield checking if you have an EF) and our tuition expenses. I also have to keep up with regular bills. Taxes will probably end up on the backburner for a little while. If I have extra time, I'll do them early but I won't plan for it.
I have discovered that being a college student and then having a kid comes with a strange benefit. College students are used to running on low sleep for short periods of time. My husband and I have been catching cat naps of 3 hours at a time and are still coherent a week later. Since he is back at work already, I kicked him out of the room last night so he could get a full night sleep, and he will spell me this weekend. Hopefully between the two of us, we can keep in up for the six months it takes for little ones to get better at sleeping at night.
So that is what is up in the crazy life of the frugal student.
Friday, January 18, 2013
I'm anti-529, normally, but not right now! Now is the time to get one!
For background, a 529 is a college savings account where the money can be used for undergraduate, graduate and professional degrees (medical school, dental school etc). The money you deposit is not tax-deductible but the profit is tax-free, just like a Roth IRA. In some states, though, the state gives you a tax deduction as well, for example my state, New York State. However, if you use money from a 529, you cannot use the federal tax credit for the education expenses. A way to get around this, is use money from your 529 for living in the dorms, if you are attending at least half-time. There is a program that allows you to live off-campus, but not all schools are part of the program. Check with your school.
The downsides to a 529, beside not having the federal credit, include higher fees than other brokerage accounts, few choices and the ability to change funds only once a year. Also, similar to 401k, and IRAs, if you remove the money for non-approved expenses, you have to pay a penalty. Personally, because of these downsides, I avoid would prefer to avoid a 529 in many cases. So, what would I normally recommend? Well, do remember that you can remove any money in Roth IRA for tuition and fees for higher education, as well as any deposits, as long as you have had the account for five tax years. I know what you are thinking, but what about retirement savings?! That is where having a 401k comes in. If you are saving 20%, to cap out of your 401k, you need to earn $87,500. The average person does not make that. So, the average person can use their 401k for retirement savings and a Roth IRA for their children's college education. Obviously, the lower income group would want to take advantage of the Roth IRAs for their retirement as well, which is what I am doing but once your income goes up, start using the 401k as well.
So why now am I recommending EVERYONE to get a 529, since I am so opposed to them? Because right now, there is free money associated with it. Bank of America started a website called grad save, which is like a baby registry for college savings which you then transfer the money you were given to a 529. I honestly think it is silly, but here is the free money part. For the next four days, they partnered with living social to give you a $50 gift card for $26. You can only buy one card per beneficiary or owner. However, doing this only took me 20 minutes. What college student/ grad student earns $96/hr, which is what this trick is worth when you compare the amount of time it takes to do this, and what you get for it.
So I opened a Vanguard 529 account with the minimum required ($25) because that is what company holds my state's 529. I, then, opened a grad saving account and then went to living social and bought the gift card. I received the gift card code within hours of ordering it. I added the cash into the grad save account, and once the 529 is finished being set up, I will transfer the $50. Once this happens, I will turn around and remove the money for class expenses for this year and close the account.
If anyone is interested in getting this deal, please feel free to use the link below to do so.
http://www.livingsocial.com/deals/491862?rpi=101339564&ref=personalized-link-box-101339564&rui=3021660
The downsides to a 529, beside not having the federal credit, include higher fees than other brokerage accounts, few choices and the ability to change funds only once a year. Also, similar to 401k, and IRAs, if you remove the money for non-approved expenses, you have to pay a penalty. Personally, because of these downsides, I avoid would prefer to avoid a 529 in many cases. So, what would I normally recommend? Well, do remember that you can remove any money in Roth IRA for tuition and fees for higher education, as well as any deposits, as long as you have had the account for five tax years. I know what you are thinking, but what about retirement savings?! That is where having a 401k comes in. If you are saving 20%, to cap out of your 401k, you need to earn $87,500. The average person does not make that. So, the average person can use their 401k for retirement savings and a Roth IRA for their children's college education. Obviously, the lower income group would want to take advantage of the Roth IRAs for their retirement as well, which is what I am doing but once your income goes up, start using the 401k as well.
So why now am I recommending EVERYONE to get a 529, since I am so opposed to them? Because right now, there is free money associated with it. Bank of America started a website called grad save, which is like a baby registry for college savings which you then transfer the money you were given to a 529. I honestly think it is silly, but here is the free money part. For the next four days, they partnered with living social to give you a $50 gift card for $26. You can only buy one card per beneficiary or owner. However, doing this only took me 20 minutes. What college student/ grad student earns $96/hr, which is what this trick is worth when you compare the amount of time it takes to do this, and what you get for it.
So I opened a Vanguard 529 account with the minimum required ($25) because that is what company holds my state's 529. I, then, opened a grad saving account and then went to living social and bought the gift card. I received the gift card code within hours of ordering it. I added the cash into the grad save account, and once the 529 is finished being set up, I will transfer the $50. Once this happens, I will turn around and remove the money for class expenses for this year and close the account.
If anyone is interested in getting this deal, please feel free to use the link below to do so.
http://www.livingsocial.com/deals/491862?rpi=101339564&ref=personalized-link-box-101339564&rui=3021660
Friday, January 4, 2013
Millionaire Update- Starting the New Year
We continue to grow our retirement savings and are now at $13,867. Though we will be not be investing any money into retirement until at least September, I am pretty pleased. Over this last year we have done very well, both because of our investing and because of the market.
We are, though, considering pulling a small amount our of my Roth IRA. Last year I opened a Roth IRA with ING Direct and received $50 for leaving $200 in there for three months. At that point we were only investing my husband's Roth, therefore my Roth has just sat in ING, earning very little. I was planning on moving it to Fidelity and starting my own Roth IRA there (I have a traditional IRA only), however once I got into graduate school plans changed.
We will need about $8000 more to pay for classes than we have from cash flow. We have the options of either using my husband's subsidized student loans from last year (we have a max available of $8500) or pulling a bit from retirement. Part of me wants to remove the ING savings because we will have to start paying back the loan before I am done with school at it will be earning an interest rate of 6.55%. Also, because I am not earning much in ING, I am less concerned about keeping the money in the Roth IRA.
We also have moved my 401k from my old employer to Vanguard to lower the fees associated with it, so hopefully we will make some decent gains from that. Even if you are a student and are going into debt, there is always something you can do, to improve your future. I need to work on remembering that, and I bet others do too. I read on blogs about people saying huge amounts, or paying down debt and I want to do so, but the money is just not there. But every cent I save, is less that I will have to pay back in the future. That counts too.
We are, though, considering pulling a small amount our of my Roth IRA. Last year I opened a Roth IRA with ING Direct and received $50 for leaving $200 in there for three months. At that point we were only investing my husband's Roth, therefore my Roth has just sat in ING, earning very little. I was planning on moving it to Fidelity and starting my own Roth IRA there (I have a traditional IRA only), however once I got into graduate school plans changed.
We will need about $8000 more to pay for classes than we have from cash flow. We have the options of either using my husband's subsidized student loans from last year (we have a max available of $8500) or pulling a bit from retirement. Part of me wants to remove the ING savings because we will have to start paying back the loan before I am done with school at it will be earning an interest rate of 6.55%. Also, because I am not earning much in ING, I am less concerned about keeping the money in the Roth IRA.
We also have moved my 401k from my old employer to Vanguard to lower the fees associated with it, so hopefully we will make some decent gains from that. Even if you are a student and are going into debt, there is always something you can do, to improve your future. I need to work on remembering that, and I bet others do too. I read on blogs about people saying huge amounts, or paying down debt and I want to do so, but the money is just not there. But every cent I save, is less that I will have to pay back in the future. That counts too.
Friday, December 21, 2012
2012 End of the Year Round Up
This month I added $105.46 to my husband's Roth using our FIA Card services cc rewards. This was not the only time I have used credit card rewards to help fill out our budget. This year I have gotten a total of $255.46 from FIA towards retirement which is about 1% of our income. 1% may not seem like a lot but it can seriously add up. And honestly, right now is the best time for us to be saving for retirement. Not only do we benefit from compound interest, but our loans are at the lowest they ever will be at. Right now all our student loans are deferred, so all we have is the mortgage at 4.75% and a personal loan of 3.49%. Once my husband graduates he will have $17000 in graduate loans at 6.55% and $5500 in undergraduate loans at 5.75%, and then when I graduate I'll add on another $5450 of undergraduate loans at 5.75%. Once we are paying those higher rate, it will be hard to throw all extra money into retirement, so any bit now, will help then. Before I found out that I had gotten into graduate school, we were putting money aside for retirement. Total with the FIA rewards and our own savings we put about 5% of my husband's salary in retirement. Naturally, if my husband and I were not students we should be saving 16%-18% of our salaries, but I think for students even a few percentage of your annual salary is enough.
We also have gotten $150 worth of cvs gift cards from discover. Normally it would be a lot less but I paid for my school fees with discover this year. I love that my school takes discover without any additional fees. These gift cards have helped us stretch our grocery budget, along with the grocery game, using iheartcvs.com. I don't think we did as well here as we could have because: 1)we were lazy and 2)we were extremely busy. Also, I was adjusting to eating differently because of being pregnant and shopping for that, so that could affected it as well. We did get better at using coupons for only what we needed, but we splurged a little too much. Next year I am going to work on improving our grocery budget and not going out to eat. We still have about $75 from the cvs gift cards so that should help next years budget. I am still trying to think of ideas to be more organized in regards to cvs. I am pretty good at checking deals at tops, and staying on top of them. I don't know why I am so bad with cvs. If anyone has any ideas on how to get better organized, I'd love to hear them. I am going to start planning meals better, and getting back to using the crockpot. Does anyone have favorite crockpot meals?
While I was working, this year, we paid out of pocket for my classes, and put money aside for the baby. However, we did not save up for the rest of my classes ($11,000 between the two semesters). We have been using the money from our renters ($550/month), after expenses to pay for the classes but we are still short. Therefore we had to dip into the student loans my husband took out a year ago and set aside, when we found out about graduate students losing the ability to get subsidized student loans. This does cause a problem because my husband will have to start paying back the loans before I graduate. This does mean that I am going to try to cut back even more next year. Every cent I save, is a cent that can let aside to pay off these loans. I think I am going to start giving myself one hour per day to work on being frugal, if that is couponing, doing a survey or writing a meal plan. This will do two things, help me decrease costs and help me work on organization before the baby comes. Readers, how do you keep organized?
My weekend plans include loading every item we have in the kitchen, into supercook.com. We keep buying things that are good deals, but not using things up. I am going to make myself make at least one recipe from supercook per week until the baby comes. This will help me keep to my budget, and will help us discover new things to eat. Part of why we are eating out, is because we are getting bored with what we have to eat at home. How do you fight boredom with meals? I'd love advice.
I also received $50 in amazon gift cards from swagbucks. This was lower than years previous and I believe it to be because I do not have the swagbar on my ipad and have been using that most often. How am I going to ramp up the amazon gift cards? Well, this will be part of my one hour of frugality per day. There are free swagbucks for listen to certain swagTV shows, often only a few minutes, which I can do while I do other frugal tasks. This should help bump up the amazon gift cards a bit.
However, I did get a $10 home depot gift card from https://www.recyclebank.com/ this year as well as an extra $1 coupon I wanted, for an item we would have purchased anyway. Given that I normally get about $60 from swagbucks, this does make up for the loss of the amazon gift cards. I hope that next year I earn another $10 gift card from recyclebank, while still making $60 from swagbucks. We will see if I can achieve it!
I received no cvs gift cards from mypoints though. I made enough to turn in for a $10 cvs gift card, but since we still have cvs gift cards from discover I chose not to redeem the points. Normally, though, I make enough points for about $40 worth of gift cards. I think this drop can be accounted for by the ipad use, and my crazy schedule. My goal for next year will actually only be $25 worth of gift cards, because of the craziness. It would be great if I am able to get more but I'll be happy with $25.
Overall I think I did less well this year than I wanted to, but that is one of the great things about being young. I can take this year and learn from it and improve as I get older.
We also have gotten $150 worth of cvs gift cards from discover. Normally it would be a lot less but I paid for my school fees with discover this year. I love that my school takes discover without any additional fees. These gift cards have helped us stretch our grocery budget, along with the grocery game, using iheartcvs.com. I don't think we did as well here as we could have because: 1)we were lazy and 2)we were extremely busy. Also, I was adjusting to eating differently because of being pregnant and shopping for that, so that could affected it as well. We did get better at using coupons for only what we needed, but we splurged a little too much. Next year I am going to work on improving our grocery budget and not going out to eat. We still have about $75 from the cvs gift cards so that should help next years budget. I am still trying to think of ideas to be more organized in regards to cvs. I am pretty good at checking deals at tops, and staying on top of them. I don't know why I am so bad with cvs. If anyone has any ideas on how to get better organized, I'd love to hear them. I am going to start planning meals better, and getting back to using the crockpot. Does anyone have favorite crockpot meals?
While I was working, this year, we paid out of pocket for my classes, and put money aside for the baby. However, we did not save up for the rest of my classes ($11,000 between the two semesters). We have been using the money from our renters ($550/month), after expenses to pay for the classes but we are still short. Therefore we had to dip into the student loans my husband took out a year ago and set aside, when we found out about graduate students losing the ability to get subsidized student loans. This does cause a problem because my husband will have to start paying back the loans before I graduate. This does mean that I am going to try to cut back even more next year. Every cent I save, is a cent that can let aside to pay off these loans. I think I am going to start giving myself one hour per day to work on being frugal, if that is couponing, doing a survey or writing a meal plan. This will do two things, help me decrease costs and help me work on organization before the baby comes. Readers, how do you keep organized?
My weekend plans include loading every item we have in the kitchen, into supercook.com. We keep buying things that are good deals, but not using things up. I am going to make myself make at least one recipe from supercook per week until the baby comes. This will help me keep to my budget, and will help us discover new things to eat. Part of why we are eating out, is because we are getting bored with what we have to eat at home. How do you fight boredom with meals? I'd love advice.
I also received $50 in amazon gift cards from swagbucks. This was lower than years previous and I believe it to be because I do not have the swagbar on my ipad and have been using that most often. How am I going to ramp up the amazon gift cards? Well, this will be part of my one hour of frugality per day. There are free swagbucks for listen to certain swagTV shows, often only a few minutes, which I can do while I do other frugal tasks. This should help bump up the amazon gift cards a bit.
However, I did get a $10 home depot gift card from https://www.recyclebank.com/ this year as well as an extra $1 coupon I wanted, for an item we would have purchased anyway. Given that I normally get about $60 from swagbucks, this does make up for the loss of the amazon gift cards. I hope that next year I earn another $10 gift card from recyclebank, while still making $60 from swagbucks. We will see if I can achieve it!
I received no cvs gift cards from mypoints though. I made enough to turn in for a $10 cvs gift card, but since we still have cvs gift cards from discover I chose not to redeem the points. Normally, though, I make enough points for about $40 worth of gift cards. I think this drop can be accounted for by the ipad use, and my crazy schedule. My goal for next year will actually only be $25 worth of gift cards, because of the craziness. It would be great if I am able to get more but I'll be happy with $25.
Overall I think I did less well this year than I wanted to, but that is one of the great things about being young. I can take this year and learn from it and improve as I get older.
Saturday, December 1, 2012
Millionaire update- November
Time for another millionaire update. Even without depositing anything into retirement this month. we have increased our assets by $31 thanks to the market. We now have $13,513 set aside for retirement. Since we have no money to deposit for awhile, I sat and thought about what we could do, in regards to our retirement. We have decided to move my old 401k over to Vanguard. That should lower some fees and may help the market increase our assets.
But, just as we have been lucky lately, the market could do a down turn at any minute and lose money. I am ok with that because we have over thirty years but I wonder how many parents have their children's 529's invested all in stocks when their children are close to starting college? Or how many parent have their own investments all in stocks when they want to retire within 10 year?
Becoming a millionaire is not just about putting money aside but also what you do with that money. I might not have any money to put aside now, but I can always find something to help our fiscal situation if I try hard enough. How about you, what can you do this month to improve your fiscal situation?
But, just as we have been lucky lately, the market could do a down turn at any minute and lose money. I am ok with that because we have over thirty years but I wonder how many parents have their children's 529's invested all in stocks when their children are close to starting college? Or how many parent have their own investments all in stocks when they want to retire within 10 year?
Becoming a millionaire is not just about putting money aside but also what you do with that money. I might not have any money to put aside now, but I can always find something to help our fiscal situation if I try hard enough. How about you, what can you do this month to improve your fiscal situation?
Friday, November 30, 2012
There is a "cash back" offer for amazon
I, like most students, love using amazon. We mostly use swagbuck earned giftcards, but will use the amazon chase if we are spending more than we have earned from swagbucks. However, today I have learned of two better ways to get "cash back" or similar when shopping on amazon this holiday season.
First, discover is allowing 5% cash back on all online shopping, including amazon, up to $1500, until December 31st. That is a better deal that three points for every dollar you spend on amazon, that you can get from amazon chase. It does require that you sign up, but there is no cost involved. However, not everyone has a discover, is there another way to get money back while shopping at amazon? For some items, yes.
Swagbucks is offering for a limited time 6 swagbucks for purchasing any jewelry, clothing, watches, handbags and purses, shoes and strange category called MYHABIT. It does not matter if you a credit card or a gift card, you can still get points back from swagbucks. Go to this link to start. http://www.swagbucks.com/shop?merchid=793
Happy shopping everyone!
First, discover is allowing 5% cash back on all online shopping, including amazon, up to $1500, until December 31st. That is a better deal that three points for every dollar you spend on amazon, that you can get from amazon chase. It does require that you sign up, but there is no cost involved. However, not everyone has a discover, is there another way to get money back while shopping at amazon? For some items, yes.
Swagbucks is offering for a limited time 6 swagbucks for purchasing any jewelry, clothing, watches, handbags and purses, shoes and strange category called MYHABIT. It does not matter if you a credit card or a gift card, you can still get points back from swagbucks. Go to this link to start. http://www.swagbucks.com/shop?merchid=793
Happy shopping everyone!
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