Tag Archives: shopping

Fixing My Budget On My Way to $2M

I’ve realized that the more money I make, the less I want to spend. It isn’t that I have lost the urge to shop… it’s that the larger purchases that matter most in life come with the most financial risk–a house, for instance, may be purchased for a certain price–but it’s only “yours” if you can afford to make he payments for 30 years and continue paying taxes afterwards.

I’d really like to get my budget under $4000 a month, but this seems impossible. At the moment I’m spending about $6000 a month, so cutting it to $4000/month for the rest of the year would be a substantial accomplishment. Here’s how I’m going to do it:

Item BUDGET Current
Rent $1,270 $1,231
Financial $300 $219
Childcare $1,200 $1,200
Food $500 $719
Kid Stuff $150 $98
Phone $120 $115
Cable/Internet $60 $55
Gas/Electric $50 $52
Car $250 $273
Shopping $150 $1,068
Gifts $50 $111
Home $75 $72
Personal Care $75 $98
Health $50 $87
Entertainment $50 $60
Travel $200 $159

The above plan puts me at spending about $4550 a month! That’s still quite a lot and I don’t even think it is doable. I don’t see where else I can cut. The current amount in the average of my spending thus far this year. Obviously shopping is quite high, so I need to figure out how to seriously stop shopping so much! I’m going on a spending hiatus for September and trying to only return things and buying nothing new (other than what I’ve purchased already this month–a few books for my son, within budget.)

This is all so I can try to start saving more each month, to get to $1,500,000 in networth by the time I turn 38 (end of 2021.) If I stick to the above budget and keep my job, it’s possible.

$1.5M isn’t that significant… I need $4M to reach my “FI” goal (financial independence) — with $4M the rest of my life will feel ok as I’ll have the security needed to do what is right for my career and my family (well, ideally $4M plus a house, but I’m going to say $2M plus a house in this case, since we can always sell our house, and my husband’s networth will hopefully grow a bit over time too, to provide some more cushion.)

I just wonder if I can stick to the above plan. I don’t even know what I buy, but I spend a fortune on shopping! I’ve spent $4472 on Amazon year-to-date (yikes!)

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Also, I just realized I had some app subscriptions that were auto renewing that I didn’t know about! Cancelled those. Have no room in this budget for random “oops I just renewed for another year” in my apps.

Can I really go on a “no spend” September (and maybe rest of year!?!) Or at least a low-spend September ($150 shopping budget is pretty much nothing… especially since I’ll be purchasing a new iphone this month (I’m still using the 5 SE!) and need to account for the payment plan.)

I probably need some work done on my car… which means the $250 a month budget is going to be tough. Maybe I’ll hold off on the work for a month or two as long as it’s safe to drive.

Welp, I’ll report back Oct 1 re: how well I’ve tracked to my spending goals this month. I’d really like to get this under $4000/month, but that just doesn’t seem realistic.

 

We ALMOST Bought a $1.8M House…

And I am, at this moment, regretting not doing it.

$1.8M.

$1-8-0-0-0-0-0-0.

That’s a heck of a lot of cash.

We’re not rich people. We’re not the type of people that should be spending $1M a home, let alone $1.8M.

But — that is what it looks like we HAVE to do if I don’t want a crazy horrible commute and we don’t want to leave the area.

What makes the $1.8M possible is that we’re still strongly leaning towards buying with (AND LIVING WITH) my in laws. The big requirement is that they have a separate living area from us (separate unit on the property or at the least an in law with separate entrance.)

The $1.8M house was super cute. 3 bedroom, 2 bath, with a 400 square foot garage we could convert…

It had its issues. Other than being $1.8M. It had some termite activity, according to the disclosures. The 400 square feet of the garage would be challenging to turn into a real 1 bedroom apartment (my in laws aren’t married but are friends, so they can live in the same unit just need their own rooms.) The lot didn’t seem that big, though I guess it was at 7,500 sq ft, but most of that was in the front yard and in a very long driveway.

I regret not buying it, but I would have regretted buying it.

It was originally a 2br/1ba, and along its life some time an addition was plopped on the back of another bedroom and bath – the master suite. But the suite wasn’t that sizable… a full sized bed felt tight in there. While the home showed quite nicely, the reality was that for $1.8M it was too small for us, given we want to grow our family soon.

But I don’t think anything here will really be the right fit… unless we want to spend $3M+, which we don’t, and we won’t, unless we win the lottery we don’t play.

That said, my husband and I started tracking our joint net worth and it’s about $920k right now. Not too shabby. Mine is about $840k of that! But that’s ok. We’re doing well, yet living in a 1 bedroom apartment. I realized that this year, with my stock and bonus and such, I could clear $300k-$350k before tax ($117k of that I’ve already made as of April 1, which is crazy to think.) If I could maintain this level of income for the next 30 years, sure, we can afford a $1.8M home. But I won’t. I won the job lottery at the moment and am holding on for dear life. In 3 years, I can save a good $300k and we should break $1M in net worth. After we hit $1M, I’ll feel comfortable having another child… but I’m not sure I feel comfortable purchasing a home for $1.5M+. $500k, sure. $800k, maybe. $1M, possibly. $1.8M…

That’s too much for a house. That’s just insane.

My husband makes $80k a year. We aren’t paying for childcare right now, but if his parents got sick that could change any minute and we’d have $2k/ mo right there. With another kid, that’s $4k a month. It just doesn’t add up. Even if his mother puts down $1M and we have a $800,000 mortgage, that’s about $7000 / mo. How does anyone do this?

Lessons in Adulting: How Much Should Living Room Furniture Cost?

When we moved in together two years ago, my Craigslist-purchased couch with ripped cushions and protruding feathers, along with my once-glued together, now peeling-apart IKEA coffee table and self-desctructive Tar-gey bookshelves which are not safe to be around a small child, seemed perfectly fine for a trancient space. With barren white walls and a few half-filled and altogether empty frames scattered about the floor, this now-married couple is trying to figure out how to create a place that feels like “home” without overdoing it (you know, like we (…ahem… I) overdid our wedding.)

Right now, we really can’t have guests over because the place is embarrassing, even on its good days when I’ve cleaned up the piles of mess. Our lease is up in May, but it is doubtful we will move next year or anytime soon (the only real reasons for us to move is 1 – rents going up an unreasonable amount, 2 – we have a child and said child turns 2, or 3, one of us gets a job super far away, like, in another state, and we need to move.) Otherwise, it looks like we’re hunkered down for a few more years in our 800-square foot, overpriced-due-to-Silicon-Valley-rental-costs abode.

This furniture has got to go. Continue reading

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2016 Spending

Although I saved a substantial sum in 2016, I definitely overspent in many areas. It was the year of my wedding so even though my parents contributed a sizable sum to the event, I splurged and spent too much on it outside of their contribution. We did a small “mini moon” which also cost something, but in 2017 we will splurge on a bigger international honeymoon. Here is a quick overview of how my spending went into 2016…

Income (after tax and 401k): $112.4k
Spending: $81.2k
(remaining / savings: $31.2k + $18k  (401k) = $49.2k saved)

Auto & Transport: $5.1k
Bills & Utilities: $1.5k
Education: $2.2k
Entertainment: $1.37k
Fees: $443
Food: $11.7k (yikes)
Gifts: $1.67k
Health: $5.4k (not counting insurance)
Home (rent and home things): $17.3k
Personal Care: $4k
Shopping: $14.8k
Wedding: $9.6k
Travel: $6.2k Continue reading

The Percentage Budget: How much should the single working woman spend on clothes?

There should be some criminal penalty for allowing me to enter a Nordstrom. The lighting, the quality-made clothing, the hip fashions that should be in my closet — not on the store rack — are too enticing. Luckily, I’m terrified of buying designer items that cost a small fortune, so I only buy items that cost a miniature fortune. Still, they add up, and I feel guilty for buying just about any item.

I wonder how these stores stay in business selling $300 shirts and $400 shoes, where a decent outfit complete with shoes and accessories costs $1000-$2000. While it doesn’t make sense for someone in a lower income bracket to shop at Nordstrom, I have to assume that this type of store and pricepoint would be targeted towards a mid-career professional earning over six figures. Not that I have to actually follow through with their marketing persona, but why can’t I enjoy the fruits of my labor in the form of a Joie blouse or Ted Baker suit? Continue reading

Shopping for a Car: The Unnecessary Saga

*edited to add: the reason I am considering such an old car model is that for the next 2 years I have the remainder of my DUI sentence with increased insurance premiums. I am paying $120 per month right now for very basic, no comprehensive insurance due to the DUI. The punishment was deserved, but I do not see myself buying a nice car which requires comprehensive insurance. My original plan was to keep my old car around until the end of the sentence so I wouldn’t have to worry about comprehensive insurance, but it’s pretty much dead now. So I’m trying to buy a car that will get me through the next 2-3 years that won’t require even more expensive insurance. I forgot to mention this.

There seem to be as many models of cars as there are people in the world. Big ones, small ones, fancy ones, simple ones, Japanese ones, American ones, European ones, new ones, old ones, really old ones with expensive surgery to make them look like younger ones, et al. And today, with my poor, destroyed ’99 Toyota parked silently in a carport space waiting for its end of days, I know it’s time to get a new(er) car. It’s been time for a while. Since, in 2011, when it was hit and had the front bumper ripped off. A year later, the insurance company finally agreed with me that the accident wasn’t my fault and send me the remainder of a $2000 check. But, the car, worth less than this with 200k miles and a leaky engine, wasn’t worth repairing. I started to hunt for a new car. Yes, in 2011.

It’s getting a little (extremely) ridiculous that I haven’t purchased a car yet. The two issues at hand are 1, determining which car to get, and 2, figuring out how to pay for the car.

When I bought my last car, I went about it in my typical anxiety-ridden way. While I was curious about the plethora of choices out there, I quickly limited my  choices but determining I should get a  Toyota or Honda. I didn’t like the Honda logo or body styles (superficial, yes, but I am) so a Toyota was the winner. I didn’t want a Corolla because they were, well, ugly (I had no idea about performance comparisons at that time.) Prior to deciding on a Toyota I nearly bought a used Chevy Aveo or a used Saab hatchback from two different dealers. Those were the only two cars I tested out before deciding on the Solara. Continue reading

Fighting Shopping Addiction

It used to be I could avoid shopping malls and manage to refrain from overspending, but with my Internet-connected lifestyle, it’s hard to avoid constant temptation. I’ve made a commitment to only purchase items this year that support my goal to get healthy (or reward me for dropping a few dress sizes), but that doesn’t equate to frugality.

While it seems silly, I get a major rush from shopping. It started when I was young. Since there was little emotional connection in my family beyond constant fights, the one time where I felt I could bond with my mother was when we went shopping. Going to the mall was our thing. And we spent way too much money on my clothes. Spending $1000 at Nordstrom was a common occurrence. I never bought designer clothing but the amount of clothing purchase added up. If I liked a shirt in blue and it came in six other colors, my mother would convince me I needed every color. Being able to purchase all of this made me feel in control, like I was on top of the world. Continue reading

The Executive Makeover (Part 1 of Many)

At a web startup, t-shirts and jeans is often the norm. It’s accepted you work around the clock so if you want to wear pajamas if no clients are coming into the office, then that might be ok on rare occasions. But as your company grows, so does the expectation of professionalism, starting with how you dress.

As others are hired at later stages in the company, this becomes further clear. T-shirts are replaced with button downs. Jeans have transformed into slacks. And, if you’re still wearing what you wore at the beginning of the company, you no longer fit in.

A 2001 study conducted by consumer research firm Yankelovich Partners, Inc., titled “Work Your Image: The Importance of Appearance on the Job” reported that 76% of respondents believe that a woman’s appearance affects whether she is taken seriously, asked to participate in meetings with upper management or is well regarded by colleagues and supervisors. Sixty four percent believe that her appearance will lead to consideration for raises or promotion. Continue reading

Confessions of a Deranged Shopaholic – HECC Edition

My Broken Coin — a fellow personal finance blogger — wrote a post on how she spent $8600 on shopping in 2012. That led me to checking out my own stats to see how much I spent on shopping last year.

$17,617!!!
$9164.78 on clothing(!)
$4,456.99 on “shopping general” (mostly Amazon.com, yikes)
$1,272.98 on “sporting goods” (camping stuff for my vacation)
$858.67 on makeup
$811.76 on hobbies
$187.81 on electronics

That’s ridiculous as it doesn’t even include my food costs. Now, I choose to live in a place where rent is $650 / month with roommates so I can afford the overrages of my shopping addiction, but I’m not sure that even adds up anymore. A 1br apartment that’s comparatively nice to my current shared 3br would cost me $1800 a month minimum, and in this location probably more like $2200. So I could spend $18600 more in rent, or, well, clearly I can spend that all on clothes, makeup and household items. Or I can just force myself not to shop for anything other than necessities for a year. Continue reading