Posts filed under ‘Finances’

4 Quick Tips for Getting Out of a Financial Rut

It’s that time again. The time when all of our plans and invitations have stacked up against us and caused us to bleed financially. This tends to happen in waves, and this summer, we’re feeling the pinch. Over the last couple months, we’ve parted with large sums of money in the form of wedding and birthday gifts, graduation gifts, and a trip to the Outer Banks in North Carolina. We also (finally) purchased our bedroom set, an Aerobed, and a new suit for Shawn. In the coming weeks, we’ve got a few more weddings to keep in mind as well.

save_moneyNeedless to say, we’ve been thinking about money. We’re not freaking out, but we need to tighten up a bit. Over the last few years, I’ve found it easier and easier to slip into “saving mode”. 1. because I’ve had to do this before and 2. because we have come up with a systematic game plan. A few months of maintenance and we’re back in business. I suggest the following steps, inspired by Frugal Dad’s post on becoming a debt-killing machine:

  1. Log in to Mint.com. It is the single one budgeting tool my lifestyle has needed. Before Mint.com, I put my bills and recurring payments into cruise control and used a “sense” to determine how much I had left to spend on everything else. A “sense”. Give me a break. Mint.com lets you rope in all of your accounts together so you can see your spending in one place. Your income, transfers, deposits and purchases are then categorized, and you can visually see the graph of your finances, practically in real time. This helps me figure out where I can easily make changes to get back on track.
  2. Find things to cut back on and things to stop spending on entirely. This time around, we took a hit by making several large one-time purchases all at the same time. These aren’t items that were extravagant, but we should have planned on spacing them out over a few months. Now I’m declaring no more big purchases until the holidays. And, no more take out! We say it all the time, but seriously, we need to put Hap’s on hold. Brown bagging it to lunch needs to be an immediate priority and being too lazy to cook on weekend nights means cereal or sandwiches, not take out. Also, I’m looking to cut into some of our bills. Our Comcast Bill is ridiculous, and thanks to the Digerati Life, I know am armed with a script to negotiate a lower monthly payment, which I plan on testing out tomorrow.
  3. Stick to the list. This is one that I’ve gotten much better at over the years. When you head to the grocery store, make a list beforehand, and stick to it. My weakness was always heading down the non-grocery aisles and picking up make-up, magazines and snack items that I didn’t need.
  4. Pay off your debts. I’m not talking longggg term debts like car loans and student loans, but if you’ve been holding onto a couple hundred dollars worth of debt on a credit card or owing someone back for a gift you went in on together, now’s the time to get it squared away. I find this type of debt to be nagging, and even if it means I have to dip into savings to get it off my conscience, it’s much easier to put money back into savings than it is to pay off shallow debts over the course of a long period.

July 24, 2009 at 10:18 pm 4 comments

Refinancing? Already? Part II

Well, over the last month (err.. and a half), Shawn and I have been keeping busy. Weddings, vacation to the Outer Banks and tons of weekend plans. No excuses for not updating the blog more, but one incredibly important activity that kept us busy was our refinance. Thanks to Twitter friend Merrill Clark (@webcontentNH), we were put in touch with the Wayne Laverdiere over at Newmarket Lending, who walked us through the refinancing process. I had done some research and had an important conversation that made me decide it was worth looking into.

If you’re considering refinancing, let me warn you that the paperwork required to back up your financial past is more involved than when purchasing a house. In order to complete refinancing, we had to gather:

  1. Copy of recent mortgage statement
  2. 07 AND 08 W2’s (from both of us)
  3. Recent paystubs
  4. Copy of most recent retirement statements
  5. Copy of all bank statements for all accounts – checking accounts, saving accounts, ING accounts, etc.
  6. Contact information for the condo association (which is an issue in and of itself)
  7. A document proving what the monthly condo fees are
  8. A copy of both of our drivers licenses and a copy of our social security cards and/or passport

When you’re seeking a mortgage, you probably have to hand over half of that (though they do verify a lot of the numbers on their own, without gathering paperwork from you) and they pull your credit report, which Wayne did not have to do.

There were two significant hinderances that we came across that caused the entire process to take almost 3 full months: The first is that everyone and their mother is refinancing right now. Refinancing helps to lock in a better rate for the life of your loan (in our case, 30 years), and helps to make your monthly payments lower. Rates are at record lows right now, and people that had previously locked in high rates saw opportunity to better their financial situation during an otherwise crappy economy. Because of this, lenders and paperwork were backed up, causing the communication between all parties invovled to be much slower than usual.

The second hinderance was my new job. When you are refinancing, the smartest thing to do is to keep your finances and income stable. That means, when you’re in the process of refinancing or buying a home, you need to keep your purchases in check too, including no major purchases like cars, home improvement, or major appliances. By getting a new job, I disrupted the process, even though I went from full time and salaried to full time and salaried. Basically, I wound up causing us another 2 weeks of waiting until I got my first full paycheck to prove my income. I don’t regret taking the new job, but if you can avoid shaking up the process that way, I’d recommend it.

We only had to pay a small amount in closing, as our other closing costs were folded into our mortgage payment. That said, we will break even in just over 3 years, which works out for us because that’s about the timeframe we had in mind for living in our condo. My best advice is to stay in close contact with your lender – be sure of numbers, dates, timeframes, etc. so that you know exactly what to expect when you get to the closing table. Some of the numbers we were given were “estimates” that wound up being significantly more when it came time to talk finitely.

Have you refinanced before? Any suggestions to add for those folks who are going through it for the first time?

July 21, 2009 at 7:56 pm Leave a comment

Financially Familiar at 25: How I Did It

I have a ridiculous habit of buying books with good intentions, and then letting them sit in my bookshelf until I find an extra half hour to start them. The habit then continues, as I make it about halfway through the book and then never pick it up again.

suzeormanSuze Orman’s book, Young, Fabulous & Broke*, was no different. But, it didn’t matter. Only reading half of this book gave me the goods I needed to make financially sound decisions in my post-college life.  The thing is, Suze designed the book as a guide, offering advice, lists and online resources every step of the way. You don’t have to read the book cover to cover, pages 1 through whatever in succession. You read the sections that apply to you.

I love the fact that there’s a game plan for setting priorities and achieving goals, and after assessing your own personal situation with her corresponding online action plan, you will get a step-by-step game plan outlining what your next best move is – be it investing, paying off debt, or saving for a large purchase or life change.

For instance, at any one time, my financial situation can revolve around a car payment, school loans, a mortgage and a 401k (and in moments of weakness, a little bit of credit card debt – damn you J. Crew). Even though the book is a couple years old, the online action plan stays up-to-date (and offers addenda to the print edition) and recently told me that – with our economy being the way it is – my best course of action was to scale back on my 401k contributions. DISCLAIMER: I am not advising you to scale back on your 401k contributions. It was simply the best move for ME.

Especially these days, it’s easy to be wildly confused about how (and where) to save money, whether or not to bother contributing to a 401k, and how to successfully merge finances with your fiance (a fun tlittle ask that we’re still figuring out).  The best thing about this book is that Suze speaks in our language. We’re not financeers with years of knowledge and we’re not complete idiots that hide cash in our mattresses, so learning from this book is easy and actionable.

*not to be confused with the ugly and wildly expensive (despite the name) Young Fabulous & Broke fashion line

May 23, 2009 at 10:56 pm Leave a comment

Refinancing? Already?

I didn’t really think we’d consider refinancing so soon. I’ve mentioned before that we had a feeling we were taken for a ride and settled for a 30-year fixed rate that was probably too high considering the economy. Boy, were we right, and I can’t just accept it anymore.

Yesterday, I was interviewed for CENT$ Magazine for an article about buying your first home. The reporter, Karen Bannan, wanted me to walk her through the processes we went through and I was more than happy to shed some light on areas that I would do differently if I could. One of the areas we discussed at length was financing. She asked me point-blank what our interest rate was and when I told her, she was appalled. I’d never actually shared this number with anyone before, so my suspicions that it was a high rate had never been validated by a reaction. I’m very thankful we had the conversation, because now we know we have options.

I assumed once we locked our rate, we were stuck with that mortgage/loan company for life (or for as long as we own the condo). Karen let me know that we can do whatever we want, whenever we want. And, if we’re not happy, we don’t have to stick with our lender. Who knew!? Until now, I think I was too embarrassed to have this conversation with my parents & brother, so it was a bit easier to get the truth and some great advice from someone who was somewhat “anonymous” to me.

So, Karen suggested I put in a request at LendingTree (which I did last night) and we’ve already received three responses from lenders who can hook us up with a full percentage rate (or more) below what we’re currently locked into.

Also, I put out a quick tweet about our intention to refinance, and a Twitter friend came through within a few minutes with the name of an honest, hardworking mortgage guy to call. We made the mistake of not listening to recommendations in the past, so this person will be hearing from me on Monday. I’d be a nice change to work with people that have our best interests in mind. Stay tuned…

April 4, 2009 at 4:05 pm 3 comments


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