It’s funny about money…

I pick the lion dancer this morning because he seems like a symbol of abundance today, the first day of a new month.  The first of a month always seems like a good chance to begin again, avoiding the errors of the previous one.  For some reason in the past months money has been tight for me.  I know that my income was reduced by several hundred dollars a month when my previous higher paying job was eliminated last summer, but I do still have a job and I earn considerably more than many people in the world.  I am blessed and fortunate in that.

So, why the feeling of parsimony?  It is all about the credit cards.  Over the years I let their balances creep up and creep up.  I have two, which I swore I would never do again.  Actually I have three, but one has no balance.  It is that blasted Costco American Express card which I rue ever accepting.  I’d heard about the great rebates, and my intention was to only use it for the amount I could pay off right away.  But then things came up, and I couldn’t always pay it right away, and voila!  It was maxed out.  I learned in a difficult way about the vindictiveness of a credit card company. They arbitrarily raise interest rates, lower available credit without obvious reason.  Okay, not exactly without reason.  The interest rate raising happened because I missed a payment a year ago January after the big storm when I had no power for over a week and I had to suddenly come up with over a thousand dollars to have a fallen tree removed from my and my neighbor’s yards.  I paid double the next month, but ni modo.  My rate went up to 24.9% overnight, and they refused to even listen to my story of woe.  Paying that card off became my new religion.  Never again was I late on anything.  They finally reduced the rate, and then after several months of perfect payment they arbitrarily reduced the available credit.   So then I took out a 0% interest card and transferred the balance.  I do not use it and am paying it off.  But in order to do that, I have to be absolutely vigilant in making the payment I told myself I would each month.  No months off for good behavior.  I dream of the day that I have all that extra money each month, but that day is uncomfortably far in the distance.

So I budget, and now am doing the envelope thing.  A few dollars each month parceled out into weekly envelopes so I never get to the last week or two with only $55.00 left.  Or less.  That has happened before and it is not pretty.  This whole experience has left me with a new view of money.  And myself.  I realize that for years I kept up what I was doing because I had room on my credit card.  I visited my mom because I could squeeze the airfare on my credit card.  I bought those great shoes the same way, gifts for my children the same way.  I have never been extravagant, really.  I just didn’t have the cash, so I used my cards, always intending to pay back what I spent but never actually doing so.

So now I see myself as sort of grimy, somehow. Or maybe not grimy.  Maybe inadequate is a better term.  Like I should be comfortable at my age, able to buy what I want to – not still using envelopes.  Being single is part of it, I suppose, not having anyone to share expenses with, but really, the truth of the matter goes back to self control.  I want what I want, whether it is food or travel or a great pair of shoes.  Or a new camera for my daughter. Or a good hotel room for her wedding night. And all of that is okay.  Not extravagant, just outside my means because I already owe too much.

At the beginning of the year I found a snowball debt reducing tool.  Here is the URL to it:  http://www.vertex42.com/Calculators/debt-reduction-calculator.html According to this tool, I’ll be debt free within two years, as long as I can stand to be so vigilant.  Meanwhile my computer is slowing down, my camera is not as agile as it used to be and my phone contract is up. An iPhone beckons me.   I WANT NEW ELECTRONICS!!  But I will resist and keep faithful to my snowball debt reduction, sending off big clumps of money every month to pay for the last things I wanted and had to have.  But I’ll say right now, that my reward for having paid it all off will be slick and shiny.  And paid for in CASH.  I will get there, envelope by envelope.  And boy, will it feel good!

Recriminations on the day after

Whew.  As much as I enjoy Christmas, I like the day after almost as much.  I like that I got through it, and I like that things are so messy I can’t procrastinate about cleaning up.  I have recriminations for myself in how I dealt with money in the last week or so; that is, when I finally give myself permission to spend some because it is CHRISTMAS, I lose control and spend way too much.  And every year I feel mildly icky for having done so, and I promise myself I’ll do better next year, and every year I do the same thing.  So, here I am, getting ready to clean up the big mess and promising myself that a.) I won’t let myself get out of spending control next year and/or b.) I will save a few dollars a month this year so I have some money earmarked for the annual overspending. Do banks still have “Christmas Clubs?”  Where you put aside a certain a mount each month and you can’t get at the money until a certain date?  Or did they go the route of lay-away, (which was actually resurrected this year)?

This year we drew names, and had only one person plus the little person for whom to buy or make gifts.  That was easier, but my person got more gifts than others and I felt embarrassed by my inability to control myself.  The little one got way more than was necessary even in her own wishes, which makes all of the gifts a little insignificant.  I’d think that by now I”d have this figured out, but I seem to bumble along the same as always.  Except now I don’t have nightmares about not having gifts for the in-laws like I used to.  Wait – is that because I no longer have in-laws?  Or would I be calmer about it anyway?

Guess I don’t have to know the answer to that.  Merry day-after and Happy week leading up to the New Year.  I plan to be ready for that.  Spic and span, no clutter anywhere, ready for art projects and lesson planning!  Oh yeah, and with a light glow of just having returned from the gym for the fourth time in a week.  Hot tub cleaned and ready for the rest of the winter.  Whatever else will make me feel calm and energetic lined up and done.  Merry and Happy to all.

Credit cards be gone!

Today I juggled a credit card.  I’m determined to get the stupid things paid off.  I have had one card through my credit union for a long time.  That was all I wanted.  Then Costco added an American Express card to its membership card, and I was swept up by the rebate offer.  I signed up, not realizing that the interest was over 17%.  Duh.  So I used it a little, for things like tires that would create a bigger rebate, and paid it off right away.  That was fine until last December when I somehow ran it up too high to pay off all at once.  I took my gd to visit her ggm in Mexico, and ya-da-ya-da, and maxed it out.  Then the big storm hit in January, no power, huge outgo of cash to remove the tree that fell in my front yard, replace my fence that blew down and I missed a payment without even realizing it.  The next month I caught it up, once I noticed that I hadn’t paid it, and didn’t worry about it.  Until they raised the interest to 29%. Yes, indeed.  So I paid it down, and asked them to reduce the interest and they declined, saying they couldn’t do so for at least a year.

At that point I went out looking for a 0% card to transfer the balance to.  When I finally found one, American Express had spontaneously reduced my interest rate to 14.9%, so transferring the balance became less urgent.  I have been diligent about paying that card.  The day the bill is issued, I pay the minimum plus $200 or so.  And I don’t use it at all.

So, here it comes.  Last Thursday, I was traveling for business and decided to put my hotel on that card, since it would be reimbursed.  I had at least $800 available credit on it and the hotel was less than $300.  When I checked in to the hotel, I handed the card to the clerk and a minute later she told me it had been declined.  I was shocked.  I haven’t charged on it, I knew what the balance was and it should not have been a problem.  I used my ATM card and then went to my room to investigate the newest American Express issue.  Nothing looked any different to me.  Finally two days later I received an email from them informing me that they had decided to reduce my credit limit.  They say the wrote me a letter telling me why, but they wanted to let me know right away by email.  (More like by card declinement).

I’ve had enough with them.  Today I activated the 0% interest card and transferred the balance from the AmEx card.  I wish they would notice and feel bad that by jacking me around they lost all that interest I would have paid.  But they won’t even care.  I wonder if Costco would care that the card they have affiliated themselves with is so crooked.  Maybe I’ll try them.  I’ll definitely get a regular costco card so I can cut that sucker up.  That’ll show em.  Right.  My focus on paying them both off is redoubled today.  Every spare cent will go towards that effort.

Weighty issues

1. Losing weight: Well, I began Weight Watchers in January.. At first the loss was regular – a pound here and there, once in a while more, often less. I was fine with that and encouraged as the number of pounds lost mounted. Then I had some traveling, several bouts of travel. When I went to New York and Washington D.C. in early April I gained about 3 pounds, and have been flummoxed by it ever since. (I’m not sure flummoxed is the right word here – but I wanted to try using it.) I go up and I go down. I am not giving up, but am a little disappointed.

I know that I need to up the exercise. There is no doubt about that – so why don’t I do it? That is an ongoing question for me. I like to do it, I just don’t like to begin to do it. It’s like I need to be numbed into ignoring my resistance to beginning. I continue to strive for success in this area. I set a new goal yesterday, and will remain valient in my determination.

2. Debt: This week I am considering refinancing my house to pay off all my debts. House, car, credit cards, student loan, everything. Having it all under one payment, which is far less than the conglomeration of payments that I barely keep up with now. I wish I had someone to advise me about this idea besides the loan agents who want my business. I weight the pros (one payment, improved credit score, all the interest on those debts tax-deductible, peace of mind) against the cons (reduced equity in my house, although still over $150K, chance of racking up more debt and then just owing it all – this fear from my sister who did that, and , well, I can’t think of any more cons.) I think the pros outweigh the cons, but am I being unrealistic or naive? Do I overestimate my own powers of self control? Always.

3. Uncertainty: I’ve not lost my uncertainty, it seems. I working on that one. I’m making prayer beads and that is something I wanted to do for years, but didn’t act on, so there’s a good sign. Poco a poco…all things in their time, I guess. So far I’m resisting the urge to beat myself up about any of it. Persistence is the key, not perfection. But I wish someone’d tell me what to do!!

PostScript: The bird was photographed by my mom on her patio. Notice the bee hovering over the orange?

Small changes: because small shifts can move everything.

1. Begin the day with a Green Drink every day for 30 days. (Began March 10)

2. Plain yogurt every morning for 30 days. (Began March 17.)

3. Track everything I spend. Just watch for three months. (Begin March, 2008)

4. Walk half an hour a day. (Begin March 20.)

(God, this all sounds so mundane, trivial, middle-aged. Oh well. Consider the source. Small shifts, it’s all about making small shifts.)

Credit card debt

Last night I read the chapter in Suze Orman’s Women and Money about credit cards.  I have allowed myself to become uncomfortably burdened with this type of debt of late, and I need a plan for getting rid of it.  She talks about how your credit affects your FICO score, the number that creditors use to determine if you can even get credit, and how high your interest rate will be.  I learned that if your max out your cards that affects your FICO score, that your available credit to debt load ratio should not be over about 10%, optimally.  (Yikes!  I’m in trouble on that one!)  A late payment on any credit card can cause all your credit card interest rates to go up (can, not will).  So it is smart to pay your credit cards off, but not cancel them.  Cancelling them will change that ratio in a negative way.  You should just pay them, and then put them away.  Or freeze the cards in a block of ice.  Or cut them up.  Or put them in a drawer, all of which will at least slow you down and give you time to think before using them.  Whatever way your willpower blows.

Here is a plan for paying the cards off.

1.  List your credit cards and the balances owing on them in order of interest rates, highest to lowest.

2.  On the card with the highest rate, figure out the most you can afford to pay each month.  It has to be greater than the minimum payment.  Double that if possible.

3.  Plan to pay the minimum payment on each of the other cards.  Keep the amount that is minimum today your payment in future months, even though the minimum amount will drop as the balance does.

4.  When the first card is paid off, add the amount you have been paying on it to the next one in line.  When that one is paid, move to the next and so on.  The total amount you pay each month toward credit cards will stay the same until you have them all paid.

5.  To speed it up more, you can add a “cash attack” plan to this.  Anytime you have any extra cash at all, make an extra payment to your highest rate card.

This isn’t rocket science, I know, but it is so easy to feel overwhelmed by credit card debt that having a concrete plan for paying it is kind of settling, I think.  Using this plan, I think I will have all mine paid off in, oh, two years or less.  (Red-faced shame…how did I let this happen?!)

Onward and upward.

Reduction physics, indeed.

After the news that my job has been eliminated, I’ve been thinking about the very real possibility of a substantial pay cut next year, plus two months with no pay at all.  Sounds punitive, doesn’t it?  Odd, after so much praise by my employers.  It’s too soon to tell what’s in store for me, but I’m thinking a lot about the necessity of reducing my spending and paying off some bills.  It is scary to see how far behind the storm damage of January has left me.  I should have a better cushion than that, and in fact I presently have no cushion at all.  So I’ve made a monthly budget tracker on Numbers to see exactly what I spend each day, what is coming in as reimbursements and extra income and what I have to pay in bills this month.  For the first time I am not able to pay everything in full.  In writing down my every expenditure I am surprised by how fast the money goes out in dribs and drabs.  I find I like keeping a watch on it, and maybe by doing so I’ll be able to make actual changes in this area.

I’ve been reading a book called Women and Money by Suze Orman, and was taken by her focus on several things that I would call virtues, or personal characteristics.  Things like honesty and integrity and cleanliness.  The last one really struck me.  I frequently lose track of keeping my home and car clean, and when things feel out of control in this area I usually feel out of control in all aspects of my life.  It’s like I just hold my breath and tough it out to the next time I get things cleaned up.  So I get what she means.  I’m wondering if taking control of finances will also help me take control of my physical environment, if it possibly works both ways.  I look forward to finding out.