My Daily Dollars

For the last week or so, I feel like my husband and I have been spending like mad.  To wit:

1. A new car
2. stepdaughter’s birthday presents and party
3. new shoes (me)
4. new shirts (2 for him, one for me)
5. cologne (him)
6. a new watch (me)
7. very expensive juice (him. . .how expensive could juice be?  you’d be surprised!)
8. groceries and wine
9. dinner out (me)
10. plane tickets for Christmas

What’s interesting is the justification for each item:

1. see recent post. . . we’ll drive it for 10-12 years
2. must do
3. old ones were REALLY shabby
4. very cute
5. ran out of old lotion.  . .this was a great boxed-set deal
6. early Christmas present
7. could help his back pain
8. necessities
9. wanted to catch up with friend
10. want to visit parents. . . kids have never flown

For each item, there’s a (mostly) rational explanation.  Even so, we could have gone without each and every purchase, expect for groceries.  On one hand, it’s all good because we can afford each purchase.  I haven’t gone over budget for the month; in fact, I’m on track to save a little bit this month.  Christmas and birthdays are regular expenses, so we’ll allow for that in the budget.  On the other hand, I feel like we have left the frugal zone completely.  Once we opened the door to spending, it’s become easier by the day to spend more.  Shopping certainly begets more shopping!

What’s troubling me these days is how should we wisely balance spending money and saving money.  When I was paying off my credit card debt, I was so focused on paying it off that I did so six months ahead of schedule.  However, in order to do that, every extra penny (often my “fun” money) went to my debt.  It was easy to sustain that “crash diet” mentality for a few months, but I know that we can’t realistically do so for years and years. 

I’m now trying to figure out why spending money that is budgeted for spending is bothering me.  Between my savings and retirement contribution, we’re saving  about 20% of our combined income, as recommended.  The car payment moves us from 25% to 20%, but we’re still saving far above the national average.  Even so, I’m uneasy about spending what is actually budgeted.  I think, in some ways, I have yet to trust that the budget will get us to our financial goals.  Since I sent in that last credit card payment, I haven’t relaxed my debt-reduction mentality.  Well, I have started spending again (see items 1-10!), but I now feel guilty about those purchases.

Another factor is my old two-budget mentality.  I spent so many years over-indulging and feeling guilty, that now guilt is an integral part of the shopping process.  Even if I can now afford what I’m buying, it’s hard to shake off the guilt.

I do think we need to sit down and plan a Christmas budget, especially since travel is a big part of it.  We also have yet to draw up a detailed budget for the things my husband buys.  I think once we do so, then I’ll feel more comfortable.  I’m also tossing around the idea of meeting with a financial planner.  I was able to  draw up a plan to wipe out my credit card debt pretty easily, but planning out the next twenty or thirty years’ of financial goals is turning out to be more daunting.  By meeting with a professional, I might be able to trust our plan more.  By trusting that the budget will really work, I can trust that it is OK to spend money when we need to.  Then, finally, I may be able to shake this budget guilt!

Anyone out there have advice on finding a good financial planner?

Yesterday was our first snowy day here in Ohio.  I loved being all nestled in, watching the snow coming down.  November is great because all the winter-y things seem cozy.  Now, by February, it’s a whole different story!  While we had fun relaxing most of the day, it was time to get out of the house by late afternoon.  We went to Macy’s to use the last of our wedding gift cards.  We also planned to eat out because that’s our thing on non-kid weekends.  We try to keep eating out to a minimum, once every other weekend.

However, by the time we were done shopping, the thought of a long wait and a noisy restaurant didn’t seem all that appealing.  Thanks to my pantry project, I knew that I had all the fixings for a good stir-fry on hand.  It only took about twenty minutes to make; I know we would have waited at least that long for a table.  We had a relaxing dinner by candlelight, daydreaming about this year’s vacation.  And I was happy, knowing that we saved $60 or so by eating in!

Speaking of saving money in your food budget, if you haven’t seen The One Dollar Diet Project, be sure to check it out.  A couple decided to eat on only $1 a day each for thirty days to raise awareness about social justice.  The experiment is complete, so you can read through it in their archives.  Thanks to them and Kelly’s recipe for polenta at Almost Frugal Food, we now have one new, frugal dish to add to the repertoire.  

Other Good Reads:

PaidTwice has finally achieved coolness.  She’s right; I’ve noticed more savers and coupon clippers around these days as well.

Mrs. Micah warns about posting picture of your keys online (like all those folks do in the “What’s in My Bag” Flickr series).

Simple Mom advises shopping now for the holidays.  My mom agrees. . . she finished Christmas shopping Thursday!

We Like Money was able to save up some fun money and had fun spending it!  I so agree that you need to have wiggle room for a bit of fun while paying off debt!

Happy reading and enjoy your Sunday!

So, a week away from the blog and guess what happens?

I buy a new car!

Eep!

Yesterday, my post about how blogging can help you improve your finances ran on Being Frugal.  Re-reading the post reminded me how much I do depend on the blog to keep me on the straight-and-narrow financial path.  I haven’t been blogging as regularly as I should, and I know that part of it was my fear of sharing my new purchase with readers.  Zipping out and financing a brand-new, 2009 Honda Civic doesn’t really align with the whole Ms. Sensible-Who-Paid-Off-Her-Debt persona that I’ve been cultivating over the last few months.

So, before you all rush to unsubscribe and delete me from your blogrolls, let me explain a little.  I’ve never bought a new car in my life; I’ve always bought my mom’s old cars.  When I lived in DC, I even went for a couple of years without a car.  I’ve never been much of a car person, and I got all nostalgic for Interurban trams on a recent trip to a local museum.  I’ve been driving my trusty 2000 Chevy Malibu since I moved to Ohio, even though my parents and my husband all wanted me to buy a new car.

OK, so, non-car-loving credentials established.  Now, why, in the midst of a giant fiscal crisis, did I go into debt for a car?

Well, I knew we could afford to buy a car in the next year or so, and my husband and I know we we’ll drive the car for 10-12 years.  When a dear family member’s car died, I knew that I could help him out by selling him mine.  So, last weekend, I uttered those famous last words, “we could just go test drive.”  And the rest is history.

Financially, on the plus side, we used savings to put down 1/4 of the price.  (You’ll notice my emergency fund pie chart had a big setback!).  Ideally, I would have liked to have more money in the bank when we bought the car, but I feel like a family emergency qualifies for raiding the funds.  And, because of these tough financial times, we were able to get a great deal, and we qualified for 1.9% financing for three years. 

I have to say, after years of dodgy credit, that it felt wonderful knowing my credit score has rebounded.  We decided to put the car and the loan in my name.  Since I paid off those credit cards, I qualified for the best rate.  Last time, when I bought my mom’s Malibu, I didn’t even qualify for a loan on my own!  I had to have my parents co-sign.  If you’re struggling to pay off debt, know that once you do, your score will change pretty quickly.

It was also pretty darn fun driving the car off the lot, awash in that new-car smell.  I soaked it up because I won’t be doing this again for at least a decade!  All in all, it might not have been a perfect decision, but I feel really good about it.  Yes, we have payments, but they’re on good terms.  As my husband reminded me, you can’t just hoard money mindlessly.  That’s as bad as spending mindlessly.  While the purchase happened pretty quickly, I’m happy that we did it.