July 9, 2012
I’ve been, in the back of my mind, in this weird mental contortionist sort of way, staring at certain big areas of our required expenses to cut down drastically.
The cable, phone and internet package was finally pruned back. We’ve chucked Comcast’s outrageous packaging of 151 channels of which 115 are crap or can’t be understood linguistically, anthropologically or by any stretch of the rational mind, just so that we can watch a few of the shows we enjoy having on in the background.
Thanks again to patient stalking of Fatwallet, I’d found an AT&T dryloop deal for $20/month for high speed internet alone. A neighbor was kind enough to confirm that the service was decent and didn’t need a single frill or frippery like phone or anything else to work properly.
So that was progress.
The next best thing was to tackle the mortgage because rates are really low and if I wanted the biggest bang for our time, that right there would do it.
Not so much.
Of course I did some basic research into rates on offer. I was astounded at the lack of attractive refinance options.
I know it’s not 2004 anymore, but I expected to put down a 20% down payment which would bring the loan down a substantial amount and figured we could get:
1. A reputable lender
2. A rate under 3%
3. Zero points
4. A lower monthly payment
I may have been delusional. Bankrate’s possible offers were pretty bad. Mostly the loans were:
1. With odd lenders
2. Between high 2% to mid 3%
3. Either zero points up through 3.5 points
4. Up to $400 more per month
5. Up to $15,000 in closing costs
Then I ran the numbers on INGDirect. And Lo! The sun had come through the clouds.
1. Easy Orange – 5 Year Fixed
2. Rate: 2.625%
3. Zero points
4. $600 less monthly
5. Approximately $2,000 in closing costs
6. Option to renew in 5 years with same closing costs and same rate
I had all the initial information up front and it sounded good. It warned me about a Final Payment “larger than the rest”, amount unspecified, but that didn’t seem unusual. Like most loans, I expected that a last payment would be at least a few times larger than the rest.
Bear in mind that I was cramming this into one of our endless days and nights. Goes something like “drag out of bed, work a really long day, try to eat at least one meal, rely on PiC to take care of Doggle morning and night because I will pass out if I do one more thing that’s not strictly necessary to sustain life, fall into a coma.”
I completed the mortgage application over dinner one night.
The detail I missed, the big glaring flaw I overlooked, was that it was a 5 or 10 year fixed rate mortgage based on paying over 30 years principle and interest. Says right there on the page.
So as it turns out, the “Final Payment” was a Balloon Payment. They just chose to use different language and I didn’t twig to the obvious.
With the payments artificially strung out across the supposed 30 years, by the time we reached the end of five years, we’d effectively have made zero progress. It was completely counterproductive.
Yes, I absolutely assumed it was down to the lowered interest rate that we were getting everything we wanted: lower rate, lower payments, and paying off the whole kit and caboodle in a shorter time frame. Yes, I was insane with fatigue to have failed to see how the real math was going to play out.
Lament: Could they not have just used the phrase Balloon Payment like normal people?
What this all means now
Option 1: Take the loan but pay up to the same monthly amt we’ve been paying. Doesn’t reduce our monthly costs which was my real goal but gets us the lower rate. Very little progress and eats up a good portion of our cash but we’re doing something. And at the end of the five years, I’ll still need to refinance because who’s going to have another some hundreds of thousands to pay that off? I’m good but I’m not that good.
Option 2: Don’t take the loan and start brainstorming again. (No action)
Option 3: Don’t take the loan and just use my Auto-Payoff tactic of throwing large chunks of money at the debt, but that also doesn’t really get at my real goal either.
My short term goal is to reduce our total monthly cash flow; the long term goal is to pay off the mortgage. Going the Auto-Payoff route only deals with the long term and doesn’t do anything for the short-term. And may actually destabilize our short and medium term positions.
Honestly I’m rather undecided what to do just yet – other than to call and clarify a point or two about the loan.
March 19, 2012
In Donna’s Strategic Pizza, she shares her experience with the beginnings of the same phenomenon that I’ve noticed has crept into our own shared lives organically, but not comfortably, over the past year and some.
One of the natural effects of living with PiC has been that my normal levels of frugality and privations to make sure that ends are met are offset by extra spending where I normally would not have chosen it.
Left to my own devices, life is conducted Broke Student Style. I don’t eat out, I don’t buy anything I don’t need unless (or even if) the existing item is falling apart, I stay home all weekend, every weekend because I can be productive, learn, and monitor finances without spending money that way. I’ll buy gifts, frugally, but rarely are purchases for myself.
PiC looks at me crossways, wondering why I didn’t just stop and pick something up to eat if I’ve run 4 hours of errands and I’m exhausted. He wonders why I don’t go out on a sunny day to shop, plan brunch, or have dinners out with family and friends.
Not only does it not occur to me to do that instead of cheap or free options like taking a snack on errands, cooking at home or going to the park or hanging out at home and catching up, it actually feels like I’m going off the rails. I’m being foolish and wasteful, spending.
Our experiences have shaped us so fundamentally differently, he and I.
When we come home after extra long (14+ hour) days, I wonder: What’s in the freezer and fridge? What kind of meal can I throw together if I don’t already have one ready? I can defrost and put something together. Or: maybe I can just pass out and forget dinner.
His is: Let’s just get take-out and get that worry out of the way.
The last thing I want to do is add spending guilt to my fatigue. The last thing he wants to do is spend more time and energy at the end of a long and tiring day.
Now that my health is so largely exacerbated by exhaustion and our income isn’t scraping by penny to penny, month to month, I have to admit that he has a point. I have to keep reminding myself that the ledger doesn’t need to be the absolute first (and only) priority.
In the early months of our living together, it was incredibly difficult not to object every single time the subject came up. To keep the issue from becoming a point of contention, I tried to artificially restrict the number of meals and the cost of eating out. I needed to impose some limits to know that we weren’t going to spiral into an endless convenience spending cycle.
After many months of tracking our expenses, we’re still looking for a system that suits us, but we’ve come to an understanding. Some convenience spending is part of our lives as a freedom he’s accustomed to, particularly when we’re, one or the other, just too tired to scrape the meal together, but we limit it to those times when the fatigue threatens familial harmony. The amount is still more than I’m comfortable with but that’s to be expected; we can work on that. Meanwhile, I’ve been learning to let go of the wallet-anxiety a little.
This is a small step in the direction of living a mindful, purposeful, and ultimately, peaceful life.
Married Life Posts:
Married Life: Benefits
Married Life: Mortgage Prepayment for Refinancing
March 11, 2012
Once in a while, you need home-and-hearth friends. The people you shared everything with, or friends on whose doorstep you could show up, wander in, help yourself to a bowl of something and know that’s a prelude to a good chat or a good comfortable silence, not getting kicked out. The days when we could easily do that are long past now, but the friends aren’t. Everyone’s pretty far away.
Speaking of far away, there’s a chance that one of the old gang are considering an international wedding. To keep the guest list down because the bride and groom will be paying for the whole thing. I wouldn’t have thought that between the travel and all it’d be that much cheaper but the prospective guest list is apparently just as daunting as mine was. So this family dodging is a more common theme these days than I expected. Thank goodness for the early warning so that I can start setting aside money now in case it does happen. The destination sounds intriguing, PiC’s definitely interested, and it’s going to cost … ooooh… moneymoney.
Posts for Perusal
~ This guy has creating things and networking down to a geeky science. Beautifully simple!
~ Ask a Manager was asked how to be an awesome hardass. She answers.
I agree with so much of it. As you start out in your nascent career, you won’t be as confident and that’s fine, you’ll build it over time. She also points out that if you are projecting confidence well ahead of your abilities, it’s generally less well received. This is true. I have managed a couple of those who don’t have the knowledge, experience and performance to back it up. And it annoys me. I end up having to be much harder on them than usual because they have unfounded belief in their abilities and performance and rather than honestly evaluating strengths and weaknesses, they’re spouting absolute nonsense when they sit down and tell me that they are the equal of so-and-so. There’s a huge difference in believing that you will do your best and learn to be truly competent and thinking that you can snow a manager into believing you’re already there. And if you’re blindly pretending you’re already there, you’re spending very little precious time developing the abilities that would actually get you there.
Confidence coupled with actual competence is one thing. Faked confidence without anything behind it? Eh.
~ StackingPennies chats along the same lines about the difference between being a girl and being a woman.
~ Suba of Wealth Informatics raises the question: why are women not in more leadership roles?
I saw a ThinkProgress stat tweeted that cites “FACT: Women perform 66% of world’s work, produce 50% of the food, earn 10% of the income and own 1% of the property (via @OECD) #icymi”
Interesting in and of itself, though I would like to see the data behind it. Without needing to say that, I know that while I think there are women are just as competent, confident, capable, and desirous of leadership positions as men, if not more, in a general comparison there is plenty of evidence that our social and cultural norms are still not in any way open having women lead. This is why consciously or not, women don’t put themselves forward for leadership, why women aren’t as supported in leadership roles, and why women aren’t as commonly confident as leaders.
Watch the differences between the way men and women are treated in politics today and note how men are attacked for their politics unless their personal scandals are brought to light, while women are attacked for everything else on a regular basis. Women in politics are synonymous with their personalities, their families, their looks and their voices. Men? They can be any number of personally negative things: fat, slobby, lazy, cheating, lying, drug abusing, a law-breaker, but that will just be a blip on the radar if it comes to light at all; women can’t expect anything less than to be called the most vile names and come under ad hominem attacks throughout their careers simply for conducting business. And depending on the severity of the issue, men can just apologize for their sins and move on, if their spin doctors are good enough.
If this isn’t an environment that isn’t openly hostile to women, I don’t know what is. Add to that, women who want to succeed have been complicit in this hostility to women, excusing or ignoring the transgressions and abuses of their own parties against women while decrying the same from the opposite parties.
I don’t discuss my personal politics here but I do have political opinions. Yet regardless of my political beliefs I do not support ANY candidate or ANY individual who feels ad hominem attacks are appropriate. I don’t care which party you belong to, wrong is wrong.
~ Welcome home from Africa, MoneyMateKate! She reminded us a couple months ago to tip on the whole bill but I’m really hoping for that post on saving on malaria.
A Recipe
I’m trying to figure out where I found this originally, but I’ve stopped having to use a recipe for it by now which means it’s finally been ingrained even in my long-term memory and it’s that delicious.
Red potatoes and green beans
serves 4
Ingredients:
1 lb new red potatoes*
1 lb green beans
1 tbls salt
1 tbls sugar
minced garlic**
1-2 tbls butter
Directions:
* If you can find the tiny ones for a good price, great. I just use the regular red potatoes and cut them up into about 1.5 inch chunks. A couple always break up a little at the end, no big deal.
** to taste; if you like garlic, one clove. If you love garlic, three or five cloves. We love garlic so we want it to cover every bite of the veggies.
Use enough water in the pot to boil the potatoes and to add the green beans to the pot as well. Start boiling the water with the sugar and salt. Boil the red potatoes for about 15 minutes. I love my green beans crispy so I add the green beans to the pot at the 15 minute mark and boil both together for another 4 minutes. They stay bright green and crunchy.
Dump both into a colandar to drain. Transfer into a serving bowl immediately and toss the butter and minced garlic in. Use a serving spoon to gently mix the beans and potatoes and coat both with butter and garlic.
December 2, 2011
With everything going on, it took two and a half weeks into married life to even look at the benefits. Ree-diculous. I’m normally obsessive about benefits but even I am now thinking 30 days post wedding is simply not enough time to deal with those changes. Still, we managed to wade through the majority of the issues.
I’ve been added to his full benefits package – Medical, Dental, Vision – and am retaining my own FSA. I was rather on the fence about that one – does it make more financial sense in terms of tax breaks for me to have the tax benefit, him, or does it come out in the wash since we should probably file together? I hadn’t a minute to do any tax estimates for the purpose of estimating how we should file so I just had to let that go for now.
A few things are still left to be done.
Because my additions to his benefits were made during his open enrollment period, his company won’t activate my benefits until the new year. Lovely.
Meanwhile, it turns out that I cannot, because of the way my benefits are structured, retain just my Dental and Vision with him as a dependent so that we have secondary coverary while dropping the Medical that I’m paying for. So I will have to drop all my benefits.
{Break for a moment of spazzing: Even though I’ll still be fully covered, that makes me feel naked. I haven’t not had my own full coverage since I was 17. Seriously. This is insecurity “I’m a dependent-what??” territory.}
I will now focus on the fact that I am exceedingly grateful to have the choice between two decent insurance plans that we can afford, even though his is more expensive, because there are too many people who can’t afford insurance at all including my own family. {That’s why the reaction, actually – I’ve always worked past the point of breaking to make sure I’d have coverage. Now we’re dependent solely on his job to provide. Dependent. *breathe*}
You will note that while I may fully intend to make rational decisions, I still have emotions about my money.
Estimated cost: Increases in monthly premiums of approximately 20% overall, but coverage will be more extensive for routine procedures.
One example: I’m expecting a slew of dental work to the tune of $1000+, and after the deductible, my cost was going estimated to be $388 on my own plan with a $100 deductible and an 80% basics coverage.
PiC’s has a lower deductible ($50) and covers 90% of basic treatment. While we’re paying $8 more/month for that premium dental plan, I’m clearly going to be saving at least that $100 difference right off the bat with this single treatment between the deductible and the extra 10% coverage.
Next up: When my coverage starts with PiC, I have to cancel my own benefits using the Life Status Change for Reason of “Insurance Coverage Changes”. I didn’t even remember that was one of the options under qualifying life event/doesn’t have to wait for open enrollment to change your plan! Learn something new.
We also increased our life insurance to more adequate amounts based on our new financial obligations and added each other as beneficiaries. That was weird. But necessary. I wouldn’t be able to carry this mortgage plus all the other finances without extra help and both PiC and my dad would need some financial assistance if I were bumped off.
That means filling out more paperwork this weekend and once again at the start of the year. After that, we should be in good shape until the next open enrollment period! *whew*
So much for simple, huh?
October 31, 2011
Go Time
Before we knew it, Thursday had arrived and it felt like nothing was done! Granted, we didn’t have all that much to do since I’d trimmed our list of need to dos down to next to nothing. But the truth was, we were rushed off our feet at work and trying to wrangle arrangements according to a slightly archaic system.
Luckily, work wasn’t a problem … in fact, my boss strongly suggested I get the heck out of there early because he thought I was insane. I suspect my team thought the same since he’d outed me behind my back. Not that I was keeping it a secret, I just didn’t have time to tell them!
Rings were stricken from that list – not critical.
New shoes for me, not critical. If I could get a dress altered, great. If not, old dress. If not, slacks and nice shirt. No, wait, incoming text from cousin – “wear a dress or else.” Big cousin, I grew up with from toddlerhood. Means it. Old dress it would be.
Manicure, pedicure, veil, hair piece, decorations, fooforrah – definitely not critical.
We needed gas for the car, we needed a place to stay post-wedding (because I do not care how frugal it is to stay at a parent’s house in town, I’m not staying there on our wedding night), we needed our travelers to be situated, picked up and dropped off at the right times. Ok, scheduled, sorted and sorted.
I called the tailor trying to explain the situation – he wouldn’t let me. “I understand ’emergency’, come come, just come in, I can do this!”
“But … no, I don’t think, please, let me explain, it’s — “
“No no, just come in!”
He didn’t really understand. Sweet man, but really should have let me explain. After pinning me up and giving me the price quote and explaining the alterations, he offered to rush the job and have it ready at 5 pm Friday.
Er.
How about noon?
Er.
Today? You need it today???
….. *nod nod*
….. I’m going to have to alter the price a little.
……*nod nod*
$10 more.
/head tilt/ — In my head: really??— I will see you in at closing, sir!
We went on a panic shop for PiC and found his entire outfit minus a shirt at Macy’s in 2 hours. Then his shirt was another 15 minutes at Banana Republic (yay for gift cards!) And back to pick up my dress. Fit. A. Dream. It was an exorbitant amount, but for a three hour rush job, I can accept that.
Despite a semi-early exit from work, the errands took us long enough that we didn’t leave until *really* late. The drive was easy, though and we arrived at dark o’clock in the morning. I napped for a few hours before heading out to get a hair trim and pick up a guest arriving at the airport. Or so I planned. I was held hostage at the hair salon while my long-time stylist trimmed and then styled my hair as she felt was more elegant and appropriate to the occasion. Hostage, I tell you! Not only would she not listen to what I asked for, she wouldn’t tell me what she planned to do. Point blank refused. “I’ll take care of it,” she says.
And then she undercharged me massively for it. She didn’t put it up or anything but I know for a fact she charges $75 for bridal hair before tip. She only charged $38 for cut and style, and wouldn’t let me tip her. Have you ever heard of such a thing??
But, she was right. It looked really much better than my original rush-out-the-door hair plan. We even had time to stop for coffee before our airport errand. Miracle worker, that woman.
Back to the house to get dressed and futz around on the internet. Oh, and book a hotel for that night! Hotel points, FTW!
{to be continued}
Part One: Race to a Wedding: Five days to a Faux-lopement
September 15, 2011
Driving into work on Tuesday morning, I rang up ING Direct to see if we/PiC could take advantage of their Mortgage Blowout.
Their teaser rate was a 5-year fixed for 2.55% (2.606% APR).
They were also offering:
* Rate Renewal feature – If you qualify, you can relock your rate and extend your fixed rate period for another 5 years at the Easy Orange rate offered at that time – all for one payment which is equal to 2 of your bi-weekly payments (maximum payment of $5,000).
* No points or hidden fees
* Free bi-weekly payments – Pay down your mortgage faster with an extra payment each year.
We did a brief rundown on the building itself, the loan, and the most recently assessed value of the property. It turns out that our/his loan to value ratio is still at 75% and ING is requiring a 65% LTV ratio so the highest loan they would offer at the moment is still $70k less than what we’d need to fully refi the loan.
For a crazy, crazy moment I seriously considered throwing some cash at the loan to make it happen but that only lasted a split second. My old anti-debt Pay-It-DOWN instincts rearing up. You know how that goes.
We’ll pass for now but I’ll be keeping an eye on the whole mortgage situation now that we’re getting closer to merging finances and therefore getting closer to putting me in charge.
*ahem*
But c’mon. We all know that I’m going to be the CFO of this family even if I am learning to share.
August 13, 2011
Our open enrollment provider’s been beating the tribal drums for WEEKS. There was this big run up to the open enrollment period with fancy brochures, posters, flyers, emails, and presentations.
It was exciting for the first few seconds except they wouldn’t let me log in when they first announced it. I have a short attention span for things that are routine these days. Since they were just doing it up big for a two-week period when they would actually let you in, I was exhausted long before launch. I want in when you tell me about it, not three weeks later.
There are only two changes planned for the upcoming year: calculating my FSA contributions and upping my commuter benefits by about $15/month because I have to take the BART more than usual and it’s expensive. I’ll double check that I’m not getting screwed on medical/dental plans but nothing is changing with them that I saw on the changes/no changes comparison table.
And our possible upcoming marriage in a few months (civil, we’re thinking) would upend the changes anyway so I’m even less fussed.
*****
What you shouldn’t forget when Open Enrolling
Medical: Did anything change? Do you need more coverage? Less coverage? (uh, doubt it?) Can you afford your premiums and copays? Do you know what they are?
Dental: Same as above
Vision: Same as above
“Extras”
Flex Spending Account (FSA): Do you know approximately what you will spend next year? Do a calculation of your copays, your medications (if any), any projected major procedures you can anticipate before you set your number. It’s a little tricky because of the use-it-or-lose-it aspect – you don’t want to overestimate and lose any money by the end of the year but it’s rather annoying to find yourself just paying out of pocket as well.
Commuter Benefits: Do you use public transit and have the option to pay pre-tax? Use it. Save yourself a bit of money and automate to boot.
Employee Assistance Program (EAP): This rarely costs anything or requires enrollment. You just need to use it if you need it. They offer all kinds of stuff: counseling for personal, family and work-related concerns, legal and financial advice, online resources, health and wellness information. You should at least check it out to see what might be there.