Grocery Debate 2012

So, on Saturday, I sat down to compare our last three trips to the grocery store to see if there were any potential savings that we were missing.  Within the last month or so, we've gone to three different grocery stores near us, so I thought I had a reasonable sample size to do adequate comparison.

I was wrong.

The Professor has been on a health kick the past month or so.  Normally, I am all for this and am actually very happy that we live healthy and active lives.  However, since she did the grocery shopping for Shop n Save ("SnS"), the sample was incomplete because a lot of normal items were not purchased during that trip.  Also, she somehow managed to spend the same amount of money we usually do without purchasing any meat or dinner options.  Vegetables, Fruit, and party appetizers are very expensive!!  Perhaps its a good thing that I do the grocery shopping! 

Anyway - I shopped at Giant Eagle ("GE") and Bottom Dollar ("BD").  From what I am able to tell, there is actually very little difference between GE and SnS.  Bananas were priced $0.01 different, but Oranges were $3.00 different, which I am chalking up to volume difference.  Chicken Breasts were nearly identical and milk was the exact same.  Bread was only $0.10 different between the two.  So, although there may be potential savings based upon sales that week, for the most part the necessities are very similar.

Bottom Dollar is definitely the cheapest option of the three.  They held similar price points for fruits and vegetables, but created tremendous value in boxed items such as granola bars, oatmeal, and Lean Pockets.  In addition, Bottom Dollar had tremendous value in toiletry items such as deodorant and toilet paper.  I am indifferent when it comes to quality at Bottom Dollar, especially when purchasing boxed snacks or cereals.  Meats are probably best purchased at the Eagle due to premiere quality, but for my ham and turkey sandwiches, I think the deli options at BD can suffice.

The only downfall for BD is the lack of gas points cross-promotion.  At GE, I earn a % of my gas at GetGo.  At SnS, I earn a $ of gas at Sunoco.  The Professor and I regularly use both those gas stations, so I'll have to figure out whether the savings at BD offset the savings from Gas.  For now, BD will get my business again. 

The flower options are bested by SnS.  They last over 2 weeks!!

Price of TV

How much is monthly TV access worth?  According to my Verizon bill - $54.99 plus taxes and fees.

There have been many discussions regarding people cutting the cable cord as a way to save money, transform their life, or just disconnect for a while.  I think it's a fascinating discussion.  With the amount of information and tv shows available through the internet, it's easily conceivable that someone could live without cable. 

Is $55 bucks a month worth losing my wife?  Absolutely NOT!  Ha.  Obviously.  However, I wonder if I could manage without watching the Pirates.  That's truly the only reason I need cable access.  Live sporting events.  Now, one could argue that ESPN has intant videos online and immediate data uupdates available, BUUUTTTT, it's not the same. 

In addition, my wife loves her shows.  It's how she unwinds after dealing with 50 crazy 5th graders all day.  I get it, she needs that to release and unwind.  Everyone has their methods.  I enjoy going to the gym or doing things like coaching or things around the house.  I really don't like watching TV to much.  Perhaps, it's just that I don't like sitting still long enough.  My mind is always racing about other things - the school work I should be doing, the yard work that needs done, the light fixture I haven't fixed yet, the book I haven't read.

What do I need TV for?  There's not a whole lot. 

1.  SportsCenter - or some variation.
2.  The Daily Show
3.  Mad Men
4.  How I Met Your Mother

In addition, the wife and I watch Modern Family, Office (although I forget why), and HGTV together, but it's ALWAYS on DVR and usually Sat or Sun morning.  I do love those mornings where we relax, enjoy our coffee and be awesome.  So, if I cut the cable cord - how would we entertain ourselves?

1.  Netflix - we currently subscribe to the monthly streaming package for $8 and offers all sorts of movies/TV shows through our Blu Ray player.  It's not a complete catalog, but it has most of what we want, just a season or two after they run.

2.  Hulu (or Other Internet on Demand) - There have been times that How I Met Your Mother didn't record or Daily Show ran long - it took me about .2 seconds to find the complete episode online.  Not a big deal at all.  I'm sure I could even do it through the Blu Ray as well in order to avoid watching on small computer screen.

Perhaps, I'll challenge myself one week or month to not watch ANY TV.  I'm intrigued whether I could do it.  I don't think it would change that much for me.  I'll be ok if I continue to miss Dances with the Stars and American Idol.  Somehow, I'll manage.  I worry about the Prof and her Housewives though...

To Tithe

For whatever reason, April is a very philanthropic month.  For three weekends in a row, the Prof and I were supposed  to have some type of fund-raising event to go to.  Ultimately, there will be only 2 as 1 event was cancelled due to the Penguins.  However, these events have gotten thinking about what it means to be wealthy and why I want to abstain from debt.

Some PF managers will say that the Bible says we are to tithe 10% of our income.  Others that we should do what we are able.  Lastly, some may choose to give it all away.  I'm not sure where I fall right now.  I feel blessed to have such giving parents and also want to do our part to help those less fortunate.  I wish I could do more.  However, between time and money, I feel that the Mrs. and I are extremely giving people.  As a teacher, she spends a crazy amount of time thinking/planning/helping her students grow from a less fortunate upbringing to hopefully a meaningful, productive life.

As a coach, my time is given to my players to help them become better athletes and men.  I also look for points in the game which will influence beyond the basketball court.

It's hard to quantify into dollars the time the Prof and I have given, but I'm glad we do it.  I love that she is a giving person.  I look forward to the days when we can raise our hand for the $25k donations.  That's why I'm so driven to excel and perform in my job and at school.  As our wealth grows, the better situation our children will be in, and the better we can help others. 

I do believe D. Ramsey when he talks about getting rid of debt in order to save more, give more, and live more.

My Education Is Worth What?

Time for another of Life's Goals.

I'd like to pay off my Student Loans by the time I am 33.  I'm 28 right now.  That gives me 5 years to pay down $37,114.  That seems like a CRAZY idea.  Maybe it is.  Let's review the Pros and Cons of paying them off early.

Pros:
1.  Did I mention Graduate Student Loans rate of 6.8%?!?!  These guys will be attacked first.
2.  Peace of Mind.  At 33, I'd be able to take the money spent on education and start saving for my kids education or take the family on a vacation or buy some nice jewelry for my loving wife!

Cons:
1.  They are in deferment right now.  So, technically there is no payment due on them, but interest is accruing at 6.8%.  I could stock pile cash now while the option is available.
2.  Student Loan Interest Deduction - Tax deduction on every penny of interest I pay.  This is nice - but not a valid reason to keep debt.

The Pros win.  Shocking, I know.  #1 is a good argument, but Pro #2 is the knockout blow.  It will require some sacrificing now, especially since I haven't earned my MBA and the potential new job and income (fingers crossed), but since it's just the Prof and I right now - I know we can do it.  Here is my plan:

Now thru Dec 2012 - $500 at Graduate Student Loans.  In 2013 - We ramp it up to $600.  Then in 2014 - We ramp it up again to $700.  These incremental increases won't have a severe impact on our budget, but they will have more profound impact on the principal balance.  Also - I'd like to put half of any Side Hustle money at this balance with the other half going to the Prof's new car.  She deserves nice things for all her sacrificing.

By the end of 2014 - the balance will be around half of what is now.  At that time - I'll have graduated won't have to worry about education expenses so we can review.  However, I feel better having a plan in place.  Especially since the Prof and I have adequate "emergency" funds and are saving quite a bit.  We have big dreams and like to enjoy life, but we've been smart and I know we will continue to be so.

Tax Day

It's April 17th - which means that all Federal, State and Local Taxes are Due!!

I'm glad I've had mine done for quite some time.  I'm glad I got a refund (except the Professor's Local Taxes!).  I hate reading and hearing this argument about a Tax Free Loan to the Government.  It's ridiculous.  I enjoy receiving a lump sum payment at the end of the year.  With interest rates on my personal checking account at .01% - what did I really miss out on??  $0.25!  That's it.  That's the interest I would have earned on my refund if I had received it bi-weekly in my paychecks.

For that amount, I'm glad I got a refund.  I would have been REALLY angry if I owed taxes at year-end when that wasn't planned for!  The professor tried making that happen, but I'm way to sly for the tax code for that to happen.

In addition, we used tax time to fund our IRA - which will benefit us in the future.  So, I enjoy doing taxes.  I know it's a pain to gather all the paper work and document everything - but it was nice to get a refund and FINALLY pay off that Honeymoon! 

Lastly - I'm tired of hearing people complain about how complicated the tax system is.  Those people are keeping HR Block and other tax people employed because for most individuals, Turbo Tax are other e-file devices are perfectly suitable to help walk people through the process.  It asks you questions about your year and identifies potential tax deductions or credits.  It takes a little bit of effort and some reading, but why wouldn't you want to save some money, do it yourself, and be confident in your refund!  I just don't understand.  Now, self-employed individuals, or others with crazy investment properties and such - I have no issues with asking for assistance.  But for a standard simple return - use computers.  They've already made our lives so much easier.

It's Muscular

There is nothing stopping us from having a baby!!! 

What amazing news!  I was worried about the possibility that there could be something preventing from having a baby.  While we're not out of the woods and nothing is certain - we can both sleep easy knowing that the uterus is not preventing anything!  Amazingly, I now know what that looks like!

Although I know we are ready for a baby and I'm very excited for it - I still wonder what my reaction will be when I get the good news!  My first impression is that I will want to run up and down the street screaming in excitement - but I know my personality is more subdued than that so I'll likely just drop to my knees and hug and kiss my wife!  I don't know.  It will be interesting.

Of course I realize that a baby will change our life.  That's why they call it a life-altering event, right!  I just don't believe that we will "miss out" on anything important.  The things we want to do we will still do.  The only thing that has changed the past couple years is the things we like to do.  Shadyside bars are out.  Apples to Apples is IN!  Besides, children are allowed to go to Notre Dame Tailgates!  Plus, I get more excited for the weekends with no plans and quality couple time, than I do those weekends with set plans and crazy agendas (St. Patty's Day!) 

Yea - I'm nervous about providing for a child and whether or not I will be a good father (I think I will be).  However, I'm confident in the Prof and I that together we can handle anything and raising a child is one of those things that I know we can do well together.  In addition, I know we have an amazing support group of family and friends who will help out and be there for us through thick and thin.

Lastly - I can't wait to play catch with my son or scare the date of my daughter.

I just hope they get a scholarship to ND.

2012 Challenge

I recently saw an article which said that minimizing the length of a challenge, can increase the success rate.  In addition, I saw an article which discussed the idea of abstaining or moderating your sacrifices.  It is with that in mind, the Prof and I (likely just me) are going to attempt a different sacrifice every month for 2012.

Obviously, Lent just came and went, but I think it could be interesting to challenge myself each month with something different.  We both agree that we are already eating relatively healthy, and I work out pretty regularly, but perhaps this will motivate me to push beyond the "Bench Press Plateau" I've been in since college (dang).  So far, my ideas are few and far between - but I've come up with these:

No Beer - Extremely difficult, but I do like my bourbon.
Working Out 6 Days a Week - the 3 or 4 Days now isn't cutting it.
No Outside Lunches - Will force me to pack a lunch EVERY day (No cheats)
No Sweets - Will be hardest for the Prof
No Alcohol - Not sure about this one...
1 Coffee per day - Ugh.  I LOVE coffee.
Swear Jar - Put a $1 into jar everytime I swear
Morning Workouts - P90x Days are back!

I'm sure I can come up with more but these should get me started.  For April, I'm starting with no Outside Lunches.  We already do a good job of packing at work, but there are always that one or two mornings a week that I cheat.  So, since the Prof has us thinking healthy, this will reinforce that idea and make us cook lunch the night before or always make sure lunch meat is in the house.

Aside from the financial gains to be had foregoing a $6-$10 lunch, I'll be eating healthier!  I'm excited.

Everytime I cave - that's $5 in the Jar (on top of money spent).

I'm excited!

Coach

2011 IRA Contribution

The Professor and I funded our IRA today!  There's been a lot of talk recently about Roth IRAs and while intrigued, I still maintain my Traditional IRA with my bank.  I've had it for quite some time and still think it serves its purpose effectively. 

It gives me another outlet to save for retirement beyond the 401(k) contributions I'm making and the 403(b) contributions my wife is making.  That's a hefty amount of money going toward retirement every year!  I'm really happy with the wife and I for making retirement contributions even though we are still trying to save for major life purchases and beginnings!  It would be easy for my wife to forget retirement and just take the money and save or put into her "car" fund - however, she knows that putting the money away now will grow for the future.  I wonder who taught her the value of compounding interest??  Just making this one time contribution will grow to $35,400 without toughing it again and assuming a modest 6.5% growth rate.

The reasons you often hear for Roth IRAs are that money is contributed post tax and deducted without being taxed.  Often, people will be in a higher tax bracket in the future than they are now.  All of that is nice - but so is increasing the amount of my current year tax refund!  In addition, I do not expect to be able to contribute into the IRA for too many years as income grows beyond the limits, so this resource won't be my sole area of future income, its only 1 aspect of it.  Paying taxes when I'm in my 70s won't have the same effect as receiving the approximately $900 extra in refund this year.

I have no problem with a Roth IRA, however, I'm not a fan of people claiming that it is the only IRA suitable for people.  There is no single model that fits everyone.  Every individual has to decide what is right for them.  Right now - for my family - the Traditional IRA is a perfect choice for us.  I'm really excited about making the contribution and watching it grow.  Plus, it also energizes me to build the savings back up!!

Coach

Down with Debt

I hate debt.

There, I said it.  I'm all for living life to the fullest and creating experiences that will last a lifetime.  I completely agree with my father-in-law that a family trip somewhere new and exciting is much more enjoyable than a new kitchen.  I just hate the idea of paying for things over a long period.

Nothing good can come from debt payments.  It's this little nuisance that hangs over your head until its finally paid off - at that point - You get a raise!! All that money you've spent each month on that car, clothes, or whatever now gets to be enjoyed without remorse.  I fully understand the value and idea of "good" debt vs. "bad" debt.  The 0% APR kitchen debt is not a big deal - however, its still money we can't utilize each month.  It's make things stressful.

Life is so much more enjoyable without debt.  I think of what life is like without a mortgage, or student loan payment and it makes me giddy.  All the money to splurge on my wife and help send my family on fun vacations and ultimately the best colleges.  I never considered myself frugal, but I don't like wasting money.  I like knowing where my money goes and maximizing the return on it.

I enjoy good bourbon.  I spend money on it.  I don't need to play the latest iPhone app or check facebook every day - so I forego an iPhone.  Maybe I am too simplistic in my desires.  I don't need or really want a new car - does that make me weird?  I enjoy spending time with my wife, my family, and friends.  I don't compete with them and they don't compete with me - at least I don't think so - and it makes me less stressful.  I push myself in my career and school because I want to provide for my wife and kids.  Sacrificing some today will mean a MUCH greater tomorrow.  I truly believe that.

I still hate sending money away every month to the government and PNC.  Can't wait to say Bye Bye Mortgage!!!

Coach

March Net Worth Review

As I've been following various PF blogs out there, one of the most interesting things I've found is the idea of monitoring Net Worth.  It seemed like a different way to check your financial status.  I liked it.

So, last weekend, I reviewed our Joint Net Worth.  Let's review:

Cash - $28,989
Investments - $65,622
Home Value - $180,000
Personal Assets - $28,750
Less: Liabilties - $175,565

Here's how it breaks down:

Cash - We are currently keeping $4,061 in our checking accounts and $24,928 in our Growth Checking Account.  I need to maintain a $2,500 balance in my checking account and another bill payment is being made in early April.  As for the Growth balance, $15,020 is for future student payments and needs to kept liquid.  Also, we will be making an IRA contribution in April and we're saving for the Professor's new car.  Thats's why we're keeping so much cash.

Investments - We have $44,412 set aside for retirement.  Only 6 years after graduating college and the money just keeps growing!!  This also does not take into account the Professor's pensions from teaching - so its actually higher.  Also, we have $15,355 in Mutual Funds and $5,834 in individual stocks.  They all performed really well in Q1 - so I'm excited to keep contributing and investing!

Personal Assets - Our home was purchased less than two years ago for $170k.  In addition, we performed some major kitchen repairs in the past year which should increase the value.  The number above isn't scientific by any means, but I do not trust or believe the Zillow value one bit considering the current neighborhood market.  Other Assets include our two vehicles valued by KBB and our Bling Bling!!  The car value will hopefully go down as we try and sell the lady's ride, but the jewelry should hold strong.

Liabilities -
Mortgage - $131,901 - No matter changes as we pay mostly interest right now.
Student Loans - $37,114 - Attacking these first and going strong toward the 6.8% Graduate loans while they are in deferment
Home Depot Credit Card - $6,550 - 0% Interest for 1 year - so knocking this down one month at a time.

Total Joint Net Worth - $127,797

I'm really happy with this number because I am certain that it will only grow as time passes.  I told the Professor that the goal is $170k by the end of the year!  Not sure if we can do it, but the sooner the debt is reduced, the quicker this number will rise!

I like the Net Worth Review - I think it will help me not micromanage our finances.  It's easy to do a one month look back/ahead and assess.  There's no reason to track every expense and cash coming in or out every day.  We have a gameplan and now it's time to execute.  No fear in living a little.