Making Me a Millionaire

Getting in Shape Without Going Broke

I’m the kind of chick who has always been weight conscious.  I’ve never starved myself or cried over my weight but I always make sure I get a good workout in and I hate the discomfort I feel when I put on weight and my jeans dig into me.  Because eating is truly a joy in my life, I can’t do the diet thing and have to keep my weight in check through exercise and portion control.  Over the last 10 years, I have spent too much money on exercise.  I’ve joined gyms, signed up for personal trainers, ran in races, invested in dumbbells, yoga mats, medicine balls.

Now that we’re moving, it’s time to cancel our pricey gym membership.  I’m sad to not have access to a nice gym but I vow to get my exercise in without going broke.  In the past, this is what exercise has cost me…

• Gym membership ($180 a month for 2 people) – we did get good use out of swimming pools, tennis courts, exercise classes and a rock wall though!
• Personal trainer – $80 for a 1/2 hour session
• Running in a race – anywhere between $20 and $80 depending on the length and size
• Indoor rock climbing – $25 a session

Now that we are moving to Seattle, I plan on taking advantage of the beautiful outdoors and saving on exercises expenses.  I’m going to put off a gym membership for as long as possible by doing the following:

• Walking.  The great thing about living in downtown is that you don’t need a car and you can walk everywhere.  All this walking helps to keep the fat off.  I used to live in NYC when I was younger and walked everywhere.  I never ever had to think about my weight because I was doing so much walking everyday!
• Hiking. With the mountains and hills everywhere, I will make an effort to go hiking on the weekends with my husband.  Great for a nice butt!
• Biking (maybe). We don’t have bikes right now so if we decide to go biking, we’ll have to invest in bikes which are expensive.  I’m also not sure if we’ll have space in our apartment for 2 bikes so we’ll have to see.  It is tempting though because there is a waterfront bike trail right outside the apartment building we’re looking at!
• Fitness DVDs. I believe in the benefits of resistance training, yoga and pilates so instead of signing up at a studio, I figure why not do it at home on my mat?  Most DVDs are around $13.  Here are some great ones…

$11.49 on Amazon.com

$8.49 on Amazon.com

$14.99 on Amazon.com

$11.99 on Amazon.com

Exercise is not only a great way to keep the fat off but it’s also very beneficial to your health.  If exercising can help reduce your chances of heart disease or cancer or stroke, I’d say it’s well worth the amount of money you put into yourself right now rather than having to pay medical bills later on.

Are there any other inexpensive/free ways of exercising that any of you out there practice?

Back from Seattle

Sorry folks!  I’ve been MIA for a while because we’ve been in Seattle checking out the city and deciding whether or not it is the place to move to.  Well, after much thought and discussion, we’ve decided that Seattle will most likely be our new home!  Now we’ll just have to work out the kinks and start downsizing.  We currently live in a 4br townhouse and have accumulated a bit of junk.  We’re looking to move into a 2br/2ba apartment in Seattle so we’ll need to spend lots of time on Craigslist  trimming down on stuff.  I’m glad we’ll be downsizing because after living in such a big house, I really do believe the bigger the house you have the more money you spend to furnish it!  I am however, sad that we won’t be owning property.  I really hope we can get back into the world of real estate before home prices get too high again.  Sometimes I wonder if this move is a good idea.  It’s definitely a great place to raise well rounded kids but with our families back east I’m sometimes conflicted.  My husband doesn’t seem to have this problem as he just does it without worrying so much.  Would you ever move across country to save yourself from state income taxes?  Would you move far from your family to give your kids a good environment to grow up in?

An Act of Charity

We’re back from New Orleans!  Had a great time there although we ran into a few storms which made it difficult to walk around.  I’m glad to be back home though and to start the research/planning process of our move.  My husband started work today but we’re not sure exactly when he’ll officially be on the road.  Once he starts traveling, we’ll make a trip to Seattle (which takes the top spot in places we are considering to move to).  When it comes to places with no state income tax, Seattle is really the only one on the list that we are both willing to move to.  Las Vegas comes in second but I don’t find it to be a family friendly place.  Ideally, we’d love to move to California but I think we’ll wait a few years for that because if we moved now, we probably wouldn’t be able to afford a very nice place to live in there.

So back to New Orleans.  We went with a group of friends which made the trip lots of fun.  But it was heartbreaking to see such poverty everywhere.  We also went to the lower ninth ward which was devastated by Hurricane Katrina and it was really an experience of a lifetime.  I recommend stopping by there to anyone who visits the New Orleans area.  It’s incredibly sad but it brings you closer to the event and allows you to see how terrible the destruction was.  It’s been 4 years and the area still has not been rebuilt.  Homelessness was everywhere and it made us wonder how many of the homeless were victims of the hurricane.

We went out for lunch on our last day and decided to pack all our leftovers into a box and offer it to the next person we saw who could use a good meal.  Just seeing the look on the man’s face when our friend handed him the box and how he immediately began eating ravenously was one of the greatest feelings.  It felt so good to know we weren’t wasting food by leaving it at the restaurant and that we were offering food to someone who was hungry.  I encourage all of you to consider doing something like this the next time you are at a restaurant and haven’t finished your meal.  There are plenty of people out there who would love to finish it for you!

The only thing that disturbed me was the fact that we had to use a styrofoam box for the food.  I doubt it got recycled.  I’m going to have to start carrying biodegradable boxes or something!

Before I sign off, I’d like to share a photo I took of steps leading to where there once was a house.  It was a heartbreaking image for me.

Down to 1 Car

Sorry everyone I know I haven’t been blogging with as much frequency as usual but we’ve been very busy over here with all the changes.  Thanks for giving me suggestions on where to move to.  We’re still trying to figure that out and we’re in the process of trying to sell one of our cars.  With my husband traveling all the time, we won’t need 2 cars so we’re going to sell one of them and save some money from that!  He’s also starting work next week so we need to get most of this stuff done soon.  Then on top of that, we’re leaving for New Orleans today for a trip that was planned a while ago and we’re trying to book our tickets back to NY for the holidays.

I’m pretty excited about selling our car.  We’re hopping to get around $23,000 – $24,000 for it and with that money plus some money we have in savings, I’d like to pay off the additional home loan we have.  By doing that, we’ll save over $7,000 in interest on that loan, reduce our insurance payments, eliminate maintenance costs and gas!  We’ll be left with one car which we’re currently leasing (i know big mistake) and once our 3 years are up, hopefully we will have saved enough to just plop down money for a good practical family car.

OK I’m off to New Orleans.  Hopefully I’ll have some nice photos for you all!

A New Job and Big Changes

My husband got the job!  He actually starts next week so that’s pretty fast.  We didn’t expect for him to start until after the holidays but I guess the sooner the better right?  Because the sooner he starts working the sooner we’ll get a paycheck and the quicker it will be for us to get back on our financial track!

With this new job, he will be consulting and will basically be flying places every week and living out of a hotel.  It’s a great job for him but this is scary because it means I’ll be alone during the weekdays and it changes our lifestyle dramatically.  The good thing about this is that we’ll be able to earn air miles and hotel points like crazy and he’ll have an allowance for food so we can cut out a big chunk of food expenses.

So since he’ll be working wherever the project needs him, we can live wherever we want!  We’ve been looking at states that have no income tax because well…we don’t want to have to pay income tax!

States with no income tax

• Washington
• Nevada
• Texas
• Florida
• South Dakota
• Wyoming
• Tennessee
• Alaska
• New Hampshire

We’ve also been looking at California (I know bad idea) because good weather is important to us.  I know that’s a terrible reason.

But of the list above, the most appealing to us right now is Seattle.  My only concern is..you guessed it…the weather!  I also don’t like the fact that their winter sunlight hours are so short and that Seattle seems so far away from the rest of the country.  A flight back to New York to see my family would be rough.

Do any of you have suggestions on good places to live and raise a family in the near future?  Things that are important to us include big city, good eats, diversity, good weather, family friendly place, preferably not as much traffic, good schools.

Should I Marry Into Debt?

Getting married is one of the biggest life altering decisions you can make.  If you marry the right person, you can enjoy a lifetime of happiness and do great things together.  If you marry the wrong person, you can ruin your life.

Not to scare everyone away from marriage, but it’s important to think about what you’re doing before you step into something that is so permanent and binding.  My husband and I had been dating through college so after we got settled in our lives, it was no surprise we decided to get married.  For us, we were lucky neither of us had debt and were able to start our lives with a stable income.  I can’t say the same for some of our other college friends who got engaged around the same time.  One of my closest friends asked me if she should be worried that her fiance had tens of thousands of dollars to pay back in school loans.  We also were friends with another couple who did not ask for advice, but everyone knew that at least one half of that couple had an obsession with shoes and bags and was proud of the fact that she had maxed out all her credit cards.

So is it a good idea to marry someone who has debt?  Well in my opinion, it depends.

Personally, I think school debt is fine.  Not everyone can afford to pay a college tuition and those who are willing to take a loan just to go to college are the ones who have their priorities straight.  Education is very important and college is a great investment.  Being in debt for education is not a bad thing and if that’s all there is to it, I say go for it!

As for the girl with the shoe/handbag obsession and the maxed out credit card pride…..well…if I was her bf I would find a way to end that relationship fast.  Finances is the number one reason why people get divorced.  You don’t want to be married to someone who is going to bring you deeper and deeper into debt and not care about changing that.  It can ruin your life, your marriage and your future.

What if they’re willing to change?  I do know people who have managed to get themselves out of debt after years of reckless spending.  If you truly believe that your partner is willing and determined to change their spending habits then I would wait a little longer before you get married and give them a chance to prove themselves.  See if their spending habits have changed, if they are paying off their debts and thinking about the future.  If you see a change that you think could be permanent, then I think it would OK to tie the knot.

Do keep in mind that although the debt incurred by your spouse before your wedding day is not yours, any debt incurred after you are married belongs to both of you.

Would you marry someone you loved who had debt?

Cutting Beauty Costs

It’s a well known fact that it costs a lot more money for women to look good than it does for men.  For men, it’s simply shower, shave, put on deodorant.  Or at least that’s all my husband really does.  For women, it’s a lot more complicated.  Being a woman (or being married to one) can be costly.  Yes, you can tell her to never shave, wax, use makeup, defrizz her hair again but then she’d feel unattractive and if you’re a guy, you’d probably like it a whole lot better if she was well groomed and pretty and feeling confident.  Since we’re watching our spending right now, I’m discovering new ways to cut down on beauty-related costs.

1. Don’t bother with expensive shampoo. I used to use only Aveda shampoo and it would cost me somewhere between $30-$40 a bottle.  I have since switched to Dove shampoo which costs me around $6 a bottle (these are 1.2L bottles) and the results?  My hair looks the same as it did when I was using Aveda.
2. Perfume is pointless. I just don’t understand why people would pay $50 for a bottle of perfume when the smell is just so overwhelming and irritating.  I told myself I would never buy perfume again.  Instead, I get body spray from Bed Bath & Beyond.  You can usually get a large bottle for $10 or so and enjoy the smell of berries or vanilla.
3. Skip Sephora. I admit, I have fun at Sephora too but everything in there is just so expensive!  You can get much cheaper beauty products (and a lot of times just as good quality) at Target.  If you want a step up then try Ulta.
4. Check out the local beauty school. Many will offer you haircuts, manicures/pedicures done by students at a very discounted rate.  If you’re just getting a trim, or you want to try out a facial, it can’t hurt to have the students practice on you.  I found my current stylist when he was still in training and only paid $15 for a wash/cut/blowdry.  Now he is no longer a student and works at one of the top salons in my city and continues to give me the rate I had when I first started going to him because I’ve known him for so long.  He charges other people $60 a cut!
5. Shampoo for shaving? I once heard Natalie Portman say on TV that she used shampoo instead of shaving cream when she shaved her legs.  I tried it that same night and converted.  I was a poor college student back then and every penny saved was important.  There really is no difference between using shampoo and shaving cream.
6. Sometimes less is more. I really believe in natural beauty.  I believe a woman can be a lot more attractive simply by being friendly, confident and having good posture.  I am really turned off by women who are dressed to the nines and covered in layers of make up.  I’ve heard so many men comment on girls when they have less make up saying they look much better without all the gunk on their faces.  In many cases, understated beauty is a lot classier than piling it on.
7. Mani/Pedis. I almost never get manicures.  I love the way they look but the idea of growing long nails and using them as storage for dirt, germs and gunk grosses me out.  Instead, I keep my nails short and neat.  I know this doesn’t work for everyone.  If you’re the kind of person who is appalled by you’re “ugly” nails, save the manicures for special events.  Maybe if you’re going to a reunion or someone’s wedding or on vacation.  And if you absolutely need to have nail polish on, try doing it yourself.  A manicure kit will cost you as little as $10.
8. Hairdryers. I got a T3 hairdryer for Christmas one year which uses special technology to dry your hair faster and make it shinier.  It cost $200.  Guess what hair dryer I prefer now?  Yep, my cheap Conair hairdryer.  My T3 hair dryer did NOT dry my hair faster and did NOT leave my hair shiny.  It was just very well marketed.

I know cutting down on beauty costs is very difficult for some women.  For some, it is just absolutely necessary to look primped all the time.  I’m not saying you can’t be all done up, but there are definitely alternatives to spending a fortune on haircare each year.  If you’re a guy, maybe you can encourage her by telling her she looks better without so much makeup on.  Or maybe you can pick out some body spray for her and tell her you like that scent better than her Burberry perfume.  Looking good does not have to cost an arm and a leg!

Don’t Let Your Stuff Own You

One of my favorite quotes from The Fight Club is one of many gems that came out of Tyler Durden’s mouth:  “It’s only after we’ve lost everything that we’re free to do anything.”

I can’t say that my husband and I ever really “lost everything” but after falling into the trap of materialism we soon discovered that we were tied down by the things we owned and felt…well, trapped.  We bought ourselves a house bigger than we needed but then ended up spending money furnishing it and maintaining it.  Then we bought ourselves 2 luxury cars and since then we have learned our lesson after seeing that my husband’s hard earned money was going to all this material and in the end we had nothing left for the family we want to start one day.  We slowly turned our lives around and are doing much better today although we are still paying through the nose for our earlier mistakes.  The best thing that came out of our lifestyle change was the sense of freedom – the fact that we could live without the constant need for something flashy and big and that we were no longer tied down by our desire for stuff.

We recently learned that one of our dearest friends bought himself a very nice car.  It is a car that is worth the salary of say…an engineer.  I almost feel like a hypocrite using his story as an example since this is something similar to what my husband and I used to do but it’s amazing how clear the picture is to you once you have stepped away from the lure of nice things.  Within 2 weeks of buying this car, he was so unhappy and fed up at work that he strongly considered quitting.  But then he realized he couldn’t because he had just bought that car.  When we asked him if he regretted his decision because he wasn’t able to quit, he responded with “No.  Do you know how many people comment on my car and take pictures of it?”

We were in no place to judge so we left it at “oh that sucks”.  But I couldn’t help but think about whether any of this stuff is so important it means being stuck at a job you’re unhappy with or not being able to save for the future.  There are a few things that became very clear to me as I thought about this story.

• Understanding your self worth is not related to materialism. I think this is a misconception among many people.  What does it really mean when people are complimenting you on your car and taking photos of it?  Does that mean you’re a better person?  It might mean you’re lucky enough to be able to buy the car but it really just ends there.
• The more stuff you have the more worries you got. After we got our 2 cars, we have had the added stress of not just paying for them, but having to worry about maintenance costs (very very high), using premium gas, parking them in public places and getting them scratched up.  I was much less stressed when I had my old Honda Civic and was able to park it on the street in downtown.
• It’s the memories, not the stuff that brings happiness. When I look back on my life, some of the best and happiest memories I’ve had are those with friends back in college when we stayed up late chowing down pizza.  It’s not that handbag I bought that puts the smile on my face.  Think about when you’re old one day and reflecting back on your life.  Are you going to smile and remember the time you went into debt and bought that shiny new car as the happiest times?  Probably not.  It’s most likely going to be the birth of your child or grandchildren, or the day you graduated from college or the day you met your future spouse.  The big expenses I don’t ever regret are those spent on traveling because those are some of the best memories I have.

What kind of things do you own right now that actually own you?

What To Do When You’ve Been Laid Off

Remember when I said there was talk of lay offs at my husband’s company?  Well guess what?  It was true and he’s getting laid off.  He has 2 more weeks of employment and then he will unemployed just like me.

All I have to say is that I am so glad we decided to take charge of our financial situation before this and that we put away the bonus he recently got instead of spending it.  My only regret is that we didn’t start sooner.  But oh well, we learn from these experiences right?

What makes our situation a little scarier is the fact that I don’t have a job either.  So when his severance runs out, we’ll be in big trouble.

So here’s a list of things we need to tackle ASAP and ways we are going to try to cut down on our spending:

1. Tell our friends and family. I know some people are embarrassed by the fact that they are unemployed and are too prideful to ask for help.  But I believe that your friends and family will not laugh at you if you are jobless.  They are more likely going to want to help in any way they can.  By letting people know you are in search of a job, you can increase your chances of actually getting one.  Your buddy from your kickball league might know of someone looking to hire in your field.  Doesn’t hurt to inform others you are looking for a job.
2. Review our finances. Because we have no idea how long it will take for him to find another job – we need to prepare for the worst.  This means taking a look at how much we’re spending each month and deciding where to cut.
3. Beef up the resume. He has already spent today working on his resume and has had several people review it.
4. Start looking for jobs. We’ve decided we’re going to open the job search to various locations around the country.  I think this will open more doors for him and increase our chances of finding a good job.
5. Get on LinkedIn. I’m a huge fan of LinkedIn.  I used to think it was pointless but my husband was once recruited on LinkedIn when he wasn’t even looking for a job and landed a great job/promotion with a nice salary increase.
6. Change our spending habits. We actually have a weekend getaway that we’re leaving for tomorrow.  Luckily, we will be in the Great Smoky Mountains where most of our activities will be outdoor (read: free) activities.  But now that we know he will be out of a job, we are going to be more vigilant with our spending.  Since I do most of the grocery shopping, I’m going to make sure we only buy necessities and try to find as many coupons as possible.
7. Sell my stuff. Craigslist, ebay/half.com here I come!

Things I will Do to Reduce Spending:

• No more clothing. I usually like to get new clothes when seasons change.  Even though I’m pretty good about getting good deals on clothing, since this is not a necessity, I won’t be spending any money on clothing as long as the hubby is still jobless.
• Cut down on juices. Juices are great but sometimes its not necessary to have that much extra sugar in your diet.  Water is free so why not cut down on the juices?
• Set my thermostat to 67. Bundling up, moving around the house and drinking green tea and soup is not that hard to do!
• Consolidate my errands. I’m going to try to save gas by grouping my errands together.  That way, I can go to the post office, then stop by the supermarket, then fill up on gas all in one trip!
• Lower my cable TV package. I love National Geographic but right now it’s not worth the extra $10 a month.
• Don’t eat out unless it’s under $10.
• No more movies. I used to be willing to go to the movies only if they were the matinee shows.  But now?  No more.  I pay $19 a month for Blockbuster All Access which allows me to rent unlimited DVDs.  I will make good use of that!

If any of you have suggestions please let me know.  I welcome any kind of advice on how to best handle being unemployed as this is a first time for us!

My Millionaire List

So I was looking around the web at personal finance blogs today to see what good advice is out there.  I came across a posting that was made well over a year ago but is such a good idea I decided to participate.  J. Money at Budgets Are Sexy proposed that we create a millionaire to do list that lists the steps that we need to reach our goal of becoming a millionaire.  Well, since my blog is centered around my efforts to become a millionaire, this was a no brainer.

And even if you have no intention of becoming a millionaire (and what sane person would not want to be one?), this is a great idea for any goal whether it be getting out of debt, saving up for a house, running a marathon, learning another language.  You get the idea.

So here’s my list….

1. Max out our retirement accounts. That means my husband’s 401k, and both of our Roth IRAs.
2. Save $400 a month. And put it into either our emergency fund or stocks.
3. Take advantage of what his company offers us. This means participating in the Employee Stock Purchase Plan and buying discounted stock.  It also means contributing to a Flexible Spending Account for our health care costs.
4. Carpool to work. My husband carpools with a nearby coworker everyday.  Not only are they saving money on gas but saving time by being able to ride in the HOV lane!
5. Never take out a loan for a luxury car. I made this mistake last year.  I am paying for it and I will never ever ever do this again.  I will never buy myself a luxury car unless I can afford to plop down cash for it after having done my part in saving and investing.
6. Limit the amount of debt. I vow to decrease the amount of debt I have.  If I have a car loan, I will do the best I can to pay it off faster than I have to.  I will also try not to make purchases that require me to borrow money (except for a house).
7. Ask myself “Do I really need this?”. This actually works!  I have saved myself hundreds of dollars this year by simply asking myself this question every time I pick up a cute shirt at the mall.  I even ask my husband this whenever he decides to come with me to Costco and randomly picks up every other item there and about 99% of the time he puts it back on the shelf.
8. Exercise & eat well. OK this may seem irrelevant but it’s not!  Healthcare costs are so high right now.  I truly believe that by taking are of my health, I am saving myself thousands of dollars in the long run.  I pledge to exercise for at least 30 minutes at least 5 days a week and to eat nutritious home cooked meals as often as possible.

OK, so I’m going to leave it at that for now and add to this list as life goes on.  I think it’s a good start and as long as I follow these steps I should be well on my way to becoming a millionaire.