Student loan forgiveness

Why I don’t endorse student loan forgiveness

Are you telling me you want to exempt and forgive people from paying student loans that they consciously got into of their very own volition.

Have you ever heard the phrase necessity is the mother of invention.

In plain English that means if you need it you will figure out a solution.

As a person who just recently conquered student debt  I have to ask myself, Why is this topic even on the table?

The truth is the real problem is that so much money is being borrowed so let address the real issue not the symptom. People being way in debt is not the cause of the problem it’s the result. The real problem is that students go into college not really understanding how money works and what it will all look like when they get out.

Oh and they accept defeat. As in ” School is so high cost I can’t possibly get an education with out going so into debt that my brain will explode.  But hey, a degree is important it doesn’t really matter in what I just need one.  After all its the only way to get a job”

So instead of being reactive, lets get some stuff in place to prevent the problem in the first place. 

Simple rules I never heard of before college but that every student should know before picking their degree.

Before you get into DEBT 

  • Don’t get into more debt then your degrees starting salary. So, know what your degree is actually worth, not just the sticker price.
  • Work during school, to pay for school(work study or better yet attend a school where working is part of the graduation requirement, I did and made 15/hr right out of high school in my field of study)
  • Apply for scholarships merit or other.  There are scholarships out there for so many things not all based on GPA. It takes time but you can find them, ” I got a scholarship for 12k a year just for being from California, no joke”
  • Realize the cost of every hr of class, Don’t retake classes. Seriously I was not the best student and retook quite a few classes. IT COST ME DEARLY. In my last year of school, the extra one I had to take due to my lack of focus , I about doubled my debt, I owed 26K and jumped all the way up to 46K in one year. Bye bye scholarship only good for 4 years.
  • Don’t ignore the schools that pay you to go. Your financial aid package should definitely be one of the determining factors for where you study.
  • Student loans are not for buying cars ( seriously I saw a shirt in college that said Sallie Mae paid for my car, I was like what does that mean? Oh that they borrowed money to buy a car. Really what the F? )
  • Most all college/universities have free extracurricular activities for enrichment and entertainment purposes. Plan to use them.

After you are in DEBT

  • After you graduate keep living like a college student.
  • You can deduct some interest in your taxes if you make less then a certain amount so, Use the tax refund you get on interest, to pay the principle . Sorry no fun money.
  • Pay highest interest rate first.
  • Watch your balance like a hawk call the provider, suffer the long wait to make sure any extra money goes to the principle
  • Use the grace period to pay down principle. 
  • Pay interest if you can during school. ( some loans accumulate interest during schooling some don’t) This prevents it from capitalizing and having your interest earn interest.
  • Max out subsidized loans first
  • Realize that debt is bad!! It doesn’t matter if it’s for coffee or university  most debt means interest, and interest means you are paying (giving away) extra money. The sooner you pay it off the less interest you will pay over all.
  • Get your priorities straight.

Lets take a look at the first bullet point.  Don’t borrow more then your starting salary. Let look at a really over simplified chart.

oversimplified graph
oversimplified graph

In this chart we just looked at the numbers, if you borrow more then your starting salary you are already extending the payment years, because you couldn’t even cover it with all your new fancy salary. This chart doesn’t even take into consideration interest, add that in and you’ll get a really ugly picture for people who over borrow.

 Now let say you can save half, much more realistic well it will take you 4 yrs to pay it off if you borrow more then your starting salary. Now if it was less then your yearly salary it would take 2 yr to pay off saving half the income.

What message are you sending?

All this is asking is learn to pay your bills. Create good habits.

I recently read an article where the question was I’m drowning in so much debt I feel like I’ll never be able to buy a car or house..hmm lets see if you can’t pay off $ 500 a month what makes you think your ready for a $ 2000 a month house payment? Clearly this pain you feel is a red flag, but the lesson to learn is not how do I get out of the obligation, it’s how do I learn to manage my money better. Oh and it also means, yeah you can’t afford to buy that truck and house yet since you can’t pay off a debt 1/10 as big.

Sorry the truth hurts.

So I say let people learn how to manage their money now and look at the long term impact of their decisions so that you don’t train people to think its ok to borrow more then you can payback. Who knows maybe this will translate to all their purchases and we won’t have people who can’t even save 20% down for a house, maxing out the
limit of what they can borrow and later filing for bankruptcy ….(A Utopian financially literate world…HEY, I can DREAM can’t I)

With all these tips why should we forgive student debt . You got into it knowingly it’s just another bill.

But just for another visual I ran some more numbers

Student loan chart
Looking at numbers for different debt situations, and some alternative payment options.

In the above chart we have different debt situations but the message its trying to convey is how much bigger your minimum payment can get. It also shows how just adding a few more dollars to your payment reduces your term sentence and saves you lots on interest. Sure its not taking into consideration if you have children or just bought a house or new car. But if you follow the rule about not borrowing more then you make the alternative payment plan is reasonable. We were able to set aside $1480 per month for our student debt and that still included $400  of fun money in our budget.

I say start holding people accountable for their decisions specially if they are fabricated problems. As in you can spend $100 a week on a bar tab but you can’t scrape together the $300 a month to pay of some principle to your loan. ( If your sharp you noticed that $100 a week equals $400 a month and you could redirect that fun money to your job of paying off that loan money). Or if you are going on international vacations or any other unnecessary spending when you have a financial obligation. 

Do you know a high school graduate who is about to transition to the real world. Pass them the advice and set them up for success
It’s true that you can lead a horse to water but you can’t make it drink . But if you put a bunch of financial puddles around them you can at least hope they’ll get their feet wet.

What do you think? Do most people have a valid reason for needing their student loans forgiven?

– The Roamer

If you want to read more of my student loan debt pay off read my article University Debt Freedom.

travel 2

Saving on a Vacation: Traveling alternatives

Its labor day weekend and so the summer officially ends. Many are out and about trying to get in their last stint of travel.

We had the chance this year to explore some new territory but looking back I’m interested to see what the cost was and whether we could have done it differently.

I’m not a travel hacker by any means. The travel I did when I was younger was largely due to school. Thinking about it I was able to do it for really cheap maybe at a cost of $100 or less for climbing trips to West Virginia and Kentucky. That was for about 3 nights with food and logging included. I would venture the trip to Chicago and Philadelphia for a conference where about the same.

So now lets analyze the Roamer clan’s summer trip to Colorado.

Recently we had a vacation. Traveling is one of the passions I want to feed but that doesn’t mean I am looking for the plushest accommodations or the highest priced locations. The small amount of travel I have been able to do has been during my college years on shoestring budgets. Living the adult life doesn’t make me want to inflate my travel cost, specially when there is no reason.

It was great fun to visit family and to experience a different place. I loved the houses in Colorado. They all looked so unique and seemed to have their own little details that made them seem so. I didn’t get to do everything I wanted ,like try out the Bcycle, but it was nice to go somewhere new. So as far as I can tell our last trip cost was $1915 for a nine night stay in Denver,CO for a family of 4. I’ll break it down in a graph then I’ll present the alternative more affordable option.

Colorado Costs

 

The Alternative

As I planned our trip I just automatically assumed we would fly. How else would we get there. It didn’t even cross my mind to drive until a coworker asked how we would be getting there and assumed we’d be driving. In retrospect  I can see that we could have driven to Colorado.  It’s a long haul with 2 kids, but I had driven twice the distance frequently to Michigan when I had just the one. So it’s possible, and oh the money we could have saved.

One of the things I had checked out was camping during our stay. Trying to figure out how we’d do that with no camping gear in CO, well, I realized it wasn’t feasible. That is only true for flying there, if we had driven we’d pack the camping gear from home. Tent, sleeping bags, and so on. We could have stayed at  Jefferson county fairgrounds, the tent stays are shown for $25 per night, 7 day stay limit, 14′ x 14′ plot.  There are showers and restrooms. Sounds good to me and what a price cut compared to our actual accommodations. 

Just changing those 2 items, how we got there and where we stay would yield us a saving of almost $1,000.00. You can see that in the table I included, and that was without changing any of the other costs. To me that is a good amount of savings.

Still we were fortunate to be able to save costs in other places. Having family in the area meant a few of the meals where covered as we visited different relatives houses, and one even let us borrow a car so we had no car rental costs.

So even though the trip could have been about half as expensive we still did ok. If you do the math it was about $53 per person per day.

Are you setting out for some travel for this long weekend? Did you just get back from a trip some where? It really is amazing how just a few tweaks to the itinerary can save you money. What do you do to save on your travel?
Vanguard 2

Entering the World of Investing

I finally did it!

I opened my own Vanguard Account!

 I took the plunge, and opened my first independent investment account.

Don’t ask me why, but I felt a rush and anticipation as I worked towards owning my vanguard fund.

I felt like I am finally jumping into the pool  of  investing.

It’s kind of amusing and silly as I have a 401k which I just currently set up to max out. That is of course also investing.

I know why it feels different, because really it isn’t my choice when it comes to the 401K. The company pick who will run our investments, then the investment firm decides what funds they will offer. You (I) just pick how much. Currently the that portfolio is running off of a target retirement date. 

Even though I know I could be more active this is just were I am at now with this.

So being able to choose it all. The investment firm, the stock. The amount.  It’s exhilarating. But I’m nervous and fearful too.

Yet I am confident. My nervousness wasn’t about loosing money it was about starting something new and pushing my comfort zone. 

I’ve been doing a lot of reading and what have I learned about investing?

KEEP IT SIMPLE!

Why vanguard?

Well I frequent lots of FI blogs, I drink the stuff up like delicious sweet juicy nectar and I’m not going to argue with the pros. (pros because they’ve been doing it longer and have net worth’s to prove it)

So here is the scoop
It really has to do with Low fees. If I’m able to drop an equal amount of money into this account as my 401k I wouldn’t be surprised to see better gains due to lower fees.

They offer a total stock market fund. 

I’m excited and can’t wait to see how I ride out the stocks bumpy upward trend.


** congratulations to me . The new proud owner of some  VTSMX stocks. All I could purchase with the $3700 I had sitting around, The VTSMX  has the low entry of $3000.

idea

Why Didn’t I think of that?

Today I had an Ah-HA moment.
Honestly, it was a face palm moment and I really did think. Why in the world did I not think of that.

Lately I have been learning a lot about finances. I’ve been getting nice and friendly with the idea of investing, and dipping my toes into optimization. So understanding the purpose and usage of a 401K has been one of them. So we finally committed to maxing out our 401K’s every year. To do that we did the math and figured out what percentage of our paychecks we had to contribute to get there.

The Problem

When we started doing this calculation we were assuming a year of contributions. Which means how do we need to spread this out in a 12 month period.

Why was this a problem?

Well we were in July not January, This means we were ignoring all the potential of this year and saying “OK, lets just make sure next year we get the $17,500 into each of our 401K.” (making and awesome plan like that is not a problem)

BUT what about this year?

This year we started with lower percentages in our 401K and just recently scaled it up to the percent we need to max out.  We would have only contributed ~$13,382 and ~$9471 to our respective 401Ks. While this is a lot better then the national average it is not the maximum contribution.

These numbers leave about ~$12,000 on the table.

The Solution

So what to do next?

So I ran the numbers again (since I am the money managing being in the house) This time with the goal to max out the contributions allotted for this year, but still have enough paycheck to pay the bills for the next 4 months.

So the math looked something like this

Max contribution- $$ already contributed-$$ taken out for next paycheck= total left to contribute

$17,500- $6,969-$712=$9,819

Then divide that by the number of months left. Then divide by 2 since I get paid twice a month.

$9,819/4=$2,454/2=$1,227

This means that for every paycheck I need to be contributing $1,227 to get close to maxing out my 401K.

Well that’s all nice and dandy but my 401K works on percentages.

So now I just divide this by my paycheck gross.

$1,227/$2,299= .53 x 100=53%

So there you have it I need( and did ) up my contribution to 53% to make sure I capture as much of my tax saving 401K money as possible.

One thing you do need to think about is you do still need to leave enough money to cover all the other draws on your paycheck. For example your medical premium, taxes, FSA and such. Even adding all my other costs I will still be able to bring in a paycheck. So make sure you do that final check.

Maybe you won’t be able to max out your account this year, but if you find your self with more money because you have payed down your debts and are living more efficiently. Well I would definitely look into dropping more money into that 401K.

Another great reason to know how to do this little calculation is that if you are planning on leaving a job (for whatever reason) and don’t have another one to go to. Well you can still get all your $17,500 while you work you just do the math. Lets say I’m planning to quit work in June 2015. Well I can just divide $17,500 by 6(# of months) and then I’ll know how much I need to contribute each month so that I contribute the max.

 

Have you had any financial Ah-ha moments lately? Let me know maybe it will inspire me to have another.
Food 1

Save Money: by not guessing what’s for dinner

Do you get home from a long day at work and walk around wondering what is for dinner . Just to throw your hands in the air with exasperation say ” F it “and jump back in the car looking for your favorite eats. Well you might not know but you are suffering from a sickness that result in a chubs belly and endless amount of money being flushed down the drain.

I know it sounds terrible. Would you like to get the cure! It’s actually easy ( no pills involved) all you have to do is grab a pen and paper ,then start making some lists. That’s right a few list will get you back to sexy waist and pockets of money*

(Cut infomercial)

Ahh,  it’s the beginning of the month and it’s time for the usual routine here at the Roamer fort. Prepping the dinner menu for the month.

Let’s face it, a lazy moment is almost all it takes to jump in the car and head to a restaurant or to pick up the phone and order carry out when it’s time for dinner. Lets also admit that rarely do we save money by eating out, and to top it off its rare to get food of good quality or nutrient. And for goodness sake sometimes it doesn’t even save us the time.

Having to rush through our bed time routine with the kids because we decided to go out to eat is not fun and it doesn’t happen if we just cooked at home.

Here are a few tips on saving money when it’s time to eat.
When that hard long day comes it’s going to take a lot of will power to not take the easy and expensive way out so here are a few preventative steps to take before that day to make choosing the healthiest and most affordable option the easiest.

Make a list

I know sooo boring but whatever. I make lists, its my thing and it is helpful . Really you could probably open your pantry and refrigerator and whip up something creative with the ingredients you find,  but in reality creativity sounds like challenge/work and when I am feeling lazy a challenge is not what I want. So back to the list.

The list I’m talking about is a list of all the food you and your partner know how to cook.. Including all the different varieties( so not sandwich but tuna sandwich,  chicken  sandwich, avocado sandwich) and so on. The benefit of this list?  Well sometimes we go out to eat because we are tired of having the same thing all the time. Chances are that even though you know how to make 20 different dishes you actually stick to about 5-7 meaning you repeat them often in a month. Ugh, No wonder you feel like you have pasta and tomatoes sauce twice a week,  because you are!

Now you can be in awe at the variety of food that can be had at home( I like to remind people to relish  such knowledge because really most of us don’t know what’s what until we write it down). Now that we are armed with this information we can move on to step 2(* if your list is small 10 dishes or less it’s time to spruce up those cooking skills unless a lack of variety is not an issue for you or the family)

Make a menu

I use to make a weekly menu .. Then I wouldn’t have to guess on that night what was for dinner and I was set for a week. But man it was a pain every Sunday. Neither of us wanted to make it plus we still ended  up repeating meals weekly, so now we make monthly menus . So you can start slow and make a week one or go all out and make a monthly one. The point is that even if you have all the ingredients to make something you might still not make it because you have to pull the idea out of thin air. That takes more effort, not that I’m encouraging laziness, just encouraging efficiency. (Roamer tip, don’t forget about lunch on the weekends).

Spend where it counts

I use to be quite reluctant to spend a lot of money on chicken and beef. Compared to all the staples they were the most expensive items. 

Then I came to the realization that I could spend $ 10 for 2 cuts of beef and maybe $4 more for veg and rice… or I could buy only vegetables and ground beef( cheap meat) save $5 on the beef. Then get a craving for steak every other week and spend $50+ dollars on 2 adult plates and maybe a kids plate at a restaurant totaling $ 100 more a month.  Or with those $100 I could have bought 10 more serving of protein, so I got smart and started spending where it mattered.

Pretty much what it comes down to is planning ahead can cut out lots of the issues you can encounter. This is true for our finances and is also true for our meals.

It’s funny because it doesn’t only save you money but it saves you from all the extra hassle. Some people would say doing all this(lists) is a hassle but what about all the hassle you deal with when you don’t know what’s for dinner day in and day out. Blah! Give me 30 min Guaranteed instead of potential hrs and hrs of hassle stretched out over 30 days.

Finally also make sure you have easy meals on hand. For me this is stuff that requires very minimal preparation. I am including my Avocado sandwich as and example for one of our lazy dinners.

To summarize

Make a list of all the meals you know
Create a menu
Make a shopping list
Spend where it matters
Have an easy to whip together meal for lazy days

My Avocado Sandwich Recipe 

Ingredients: Eggs, Avocado, Onions, Spinach,Bread, Lemons, olive oil

1. Add olive oil to pan, Scramble eggs in a pan, cook/brown onions

2. Rinse spinach and lime, Toast bread, Cut avocado

3.Assemble Sandwich, Squirt lemon juice before adding second slice of bread. ENJOY! you could even add a side of carrots

food

* result vary and are 100% dependent on what you eat and that money saved is not wasted in some other area

What Tips do you have for cutting food costs?
Reading

A love for Reading: Introducing the reading list


When I was young I loved the library, we went often. We would kill hrs there weekly. I got to know the layout really well.  I knew where all the math books were and the music books. I knew the kids section, teen. I knew exactly where to find  Edgar Allan Poe, Stephen king and Mary Higgins Clark. I searched for time travel books and read entire series ( Animorphs and A Wrinkle in Time). It was amazing, I loved it.

Somewhere along the way I was given a sheet to track all the books I was reading. I liked that too, it was great to go back to it. I still have it.

A year or 2 ago it made me sad to think I hadn’t read in so long( not counting curious George or other children’s books) but I realized I had been reading. It was just in smaller snippets, I had been reading posts online. So in that spirit I thought my blog is a great place to build my new list. It will taunt me and encourage me to pick up a book and carve at least a few hrs a month to read for myself. It might also inspire you and give you some good books ( or blogs)to check out.

Knowledge  really is power

Money

  BiggerPockets (real estate blog)
  MrMoneyMustache (blog)

Child

    Janet Lansbury (blog, check out my review)

Creativity

 Steal like an artist (book) 7/14

* I will try my best to keep it useful
** excited to be bringing reading higher up on my to do list

Do you have any recommendation? What was your favorite book?

child time 2

RIE, a parenting philosophy that makes sense for baby and wallet

A review of why the RIE philosophy mixes well with people who go against the grain. A practice where money and babies don’t collide.

On this blog I have set 3 main goals for myself, not just of things I want to talk about but of things I want to learn more about and get better at. The journey includes retirement, travel, and parenthood, the common denominator is using money as the tool that ties it all together.

So why would someone who is budget conscious like Janet Lansbury’s blog , well simply put the child rearing philosophy she speaks about does not encourage immersing your baby or any child into a sea of toys and one trick ponies. Parents are encouraged to let children develop on their own. That means no walkers, jumping seats or spending time in any other restrictive apparatus.  She explains how children can find entertainment in nature, explore and be creative . That means no on toys that are flashy and distracting.

What does this add up to?  Financially big saving. By deeming most of what we currently believe to be necessary for our kids as unnecessary an even detrimental to their natural development. We end up with encouragement for limiting items, no one is on the hook for “depriving” their children of these worthless toys. Instead you learn to tune in to your children and when they can just be, you are free from having to buy an endless parade of toys to entertain them. 

I found Janet’s blog long before I found MMM. I recommend you to check it out. I think it’s very compatible with the goals here.
I am attaching two posts, I think it is as good a place as any to start, but like with any blog you need to poke around and at least read several article to get an idea of some of the intricacies in the parenting philosophy.child time

So having kids doesn’t have to cost an arm and a leg, and actually I believe you’ll find if you spend more time and less money that baby and budgets don’t actually collide.

http://www.janetlansbury.com/2013/12/rie-parenting-basics-9-ways-to-put-respect-into-action/

http://www.janetlansbury.com/2013/07/unexpected-toy-find-2/

Did you check it out? What did you think?

Baby Budget

Choosing between the Baby and the Budget

When numbers like $10,000 on baby’s first year get thrown around regularly, and anecdotes like it cost half a million dollars to raise kids these days. Well it isn’t a surprise that most parent or would be parent feel the walls closing in even as they choose the decor for baby’s room.  $10,000 is what baby center says it will cost ya for baby’s first year. Well I’ll have to disagree as many comment-er on that page did because we just welcomed baby number 2 last year and as far as I can tell those numbers are wacko!

We just celebrated the first birthday of our youngest (a little girl) and it was a nice relaxing event. Our one year celebration was just us and it was nice to not have to worry about all the extra activities you add on to your plate when you plan a big shindig.  We just focused on enjoying the moment.

Thinking and talking about big first birthday bashes makes me see floating dollar signs being flushed down the toilet.  A one year old definitely does not request or need all that frivolous spending.

I’ll put my dollars in the bank to buy myself some extra freedom, and more quality time with the kids thank you. So  now that I’ve hinted at the big expenses for a first birthday if you choose to go that route lets also rewind and see what my baby costs were for the first year.

How much money did we spend on baby?

First Year Expenses, $10,000? I don't think so.
First Year Expenses, $10,000? I don’t think so.

So lets look at each section and do some explaining.

Diapers

Ah diapers this by all is considered to be the black whole and cash eating machine. With my first I had considered cloth diapers but it just didn’t make sense at the time since we were both college students. I hear they save you a bundle but I’ve never had the chance to test them out. With my second I didn’t even consider it since again we were both working so Disposable it was.  So what was my number for the first year with disposables? Well I can definitely say we bought in bulk none of these 30-60 count stuff for $19. We went straight to the 112-150 count for $29, we used coupons, and we bought when target would have a sale(credit a $10 gift card). All in all I don’t think it was that bad but I know I could have done better.

Formula

The joys of nursing. Some women can’t nurse, and there is nothing they can do about it. Other women CHOOSE not to nurse and all I can say is financially that is a horrible idea. I’m not even going to get into the debate about how breast milk is the best thing for baby.  But FORMULA! that stuff is expensive! Especially if you need it for every meal. So how did we keep that cost down? Well first we predominantly nursed and only slightly supplemented. However, to further keep costs down you should try the following. Sign up for the manufactures club. Enfamil has something of the sort and it was really beneficial. At the hospital we left with a parting gift, bottles and bottles of ready to drink formula. Then we also got a box at home with 36 more of the ready to drink formula.  They also send coupons to save $5-$7 on their product purchases. Nursing is still the most affordable, so I say give it a real shot. With the first child nursing was a piece of cake, with the second it was a disaster lots of crying from mom and baby, but they advise you to stick with it for 3 months. You know what, once we got to 3 months it wasn’t a disaster anymore. So if you can give it a shot not only will your baby thank you, so will your wallet.

Clothes

Since we found it more exciting to not know baby’s gender the first little Roamer had neutral clothing for up to 6 months. This worked out great for little Roamer number 2 which we also did not find out gender till delivery.  This meant I could reuse baby clothing  from first baby. We also aren’t to proud to accept hand me downs and a generous coworker gifted us a whole year of outfits.  Also while out one day we were gifted a nursing cover from a complete  stranger … sure it was a bit of an awkward situation for us but hey it was free! So if you want to keep costs down ask friends and family if they have any left overs from their baby. Looking forward I am checking out Craigslist for her next batch and I see big lots selling for $45 or $1 per item. So that looks like a great resource as well.  When it comes to clothing Appreciate family, friends, and even strangers generosity.

Furniture

Crib?  I’ve never actually owned one. For my first well we were poor college students and we moved so frequently across the US that a big bulky piece of furniture just didn’t make sense when you are trying to fit everything including baby in a car. My first survived and thrive just fine in a Graco pack n play with the bassinet conversion. He did have a crib for a 3-6 month stint when a family member loaned us one.  Luckily we kept those items and when baby 2 came well we used what we had.  I definitely caught a lot of flack for not having a crib from my family but I just didn’t see the need to upgrade. So making a price comparison it looks like the pack an plays range from $70 to above $200 depending on the add on and configuration compared to cribs which start at $200 and go up to the thousands(does that include a mattress? i don’t know). This is  buying new so you have lots of room to save here. Plus with a pack and play you also save by not buying all that unnecessary bedding which is dangerous for a newborn anyway (SIDS anyone)

All the other furniture went like this Car seat? Yes and new. Old car seat was past the 6 year mark so new it was. Stroller? bought as a set with car seat.High Chair? found on Craigslist Used $45, the cheapest new was $95.

Food

Well this post is turning to a book so I’ll keep it short. We heard of baby lead weaning which means you go straight to solid food. Soft solid food but none of this puree stuff. This meant a lot of saving in the food department. Did you know Gerber or whatever cost $1 for about 5 oz. For that price you can buy a bag of carrots and get multiple days of meals. Turns out cooking baby food is really easy. So we did that and only supplemented with packaged food for convenience. This is obvious in our chart  food costs.

Medical

Sheesh it took me doing the research for this article to really realize this cost. In the first year my baby had 3 emergency room visits at $100 a pop. These incident were by far the most costly expenses. I never knew what a nursemaid elbow was with my eldest but now I do and I feel so sad that my youngest baby got them, but the worst part is that apparently after they get them once they are more likely to get them again until their stuff is all set at age 5. I had the ER visits with my oldest as well, but I didn’t have insurance back then so those were like $500 a pop. So I can see the costs adding up for those who don’t have insurance.

So that should cover most of the costs. However, I’ll assume that I lost a receipt somewhere and make that $1,300 a nice round $1,500. Even so I don’t see any other costs that I missed and that means out of the $10,000  my total amounted to about 15% . Now lets assume that this is likely the case and that child expenses are grossly overestimated. Well that means that raising a kid to 18 really shouldn’t cost you an arm and a leg and that the expenses are well within your control and open for interpretation.

I did not follow the fast growing ridiculously lavish first birthday trend.  My daughter did not receive a pile of gifts, I didn’t buy fancy decorations and order a custom birthday cake piled high with sugar and fake coloring. I didn’t hire a professional photographer either ( I know how to work a camera and I don’t need Photoshop magic changing reality). Maybe some people will say she missed out, some how I don’t think she’ll ever complain.

So what have you done to cut baby costs? Do you feel your missing out? Do you really need to choose between the Baby and the Budget?

 

7yrs

7 years of travel: The power of looking back

How well do you remember your past?

I would not consider myself a traveler. It is more a goal and aspiration. In comparison to some family members with less means than myself, I have been to fewer places. And I definitely learn a lot from travel hackers ( by default I guess that means I don’t know a lot ) but I guess I haven’t given myself enough credit. Sometimes looking in the past has it’s benefits…

During the application process for a job I was asked to provide my addresses for 7 year to do a background check. 7 years!
I knew I moved around a lot for school but I guess I never thought of it before. As it turns out I had a really hard time coming up with 7 yrs of history but after some digging these are the stats I have to report.

Where have I lived?

So within the past 7 years I have held an address in all the following cities for 3 months or more.

    • Flint, MI.
    • Costa Mesa , Ca
    • San Leandro, Ca
    • San Francisco, Ca
    • Anaheim, Ca
    • Bellflower, Ca
    • Norwalk, Ca

(Can you tell I really like California) ;)

Now I know what you are thinking.. you are probably saying “Wait a minute that doesn’t look so bad. Why did you have such a hard time gathering that up.” Well in reality even though I have only live in 7 different cities in the past 7 years my housing situation was more complicated then that.

In that time I have lived in 14 different houses/ Apartments. That is a lot of addresses to try and remember. But I guess that’s the life of a wanderer( Hence the Roamer).  No but really it was due to my University’s school schedule.

 Places I have Traveled to in my last 7 years

Not only have I lived in 7 different cities in the past 7 years I have also had a chance to visit quite a few places. These are the stats of places I have spent 2 or more nights at.

    • Dearborn, MI                                          • Madison, WI
    • Port Huron, MI                                      • Salt Lake City, UT
    • New River Gorge, WV                        • Yosemite, CA
    • Kentucky                                                    • Las Vegas, NV
    • Chicago, IL                                                 • Oil City, PA
    • Philadelphia, PA
Things I’ve seen

I have also had the chance to  spend a few hours and briefly pass through sites such as, Niagra Falls, from Canada side,  The Rock and Roll hall of fame in Ohio, Frank Lloyd Wrights  house Falling Waters in PA, Hearst Castle,CA; Zion National Park, UT; The Grand Canyon, AZ; The Saint Louis Arch, MO

So why do I say all this ? … How is it going to help?… Well I guess really this post is more about reflection. Sometimes life happens so fast you miss what’s happening. And I’m glad to know that even though trips haven’t been as grandiose as I’d like( India sigh Japan , China,  3 months studying abroad) .  Sure it might not have been what I wanted it to be, but it’s surely nothing to scoff at. I have found a way to feed my passion even if it means getting to know my backyard better. For example my time in San Francisco was really amazing specially with the random meeting of an Asian tourist an impromptu dinner date in china town and late night walk through the city will be a memory and story I tell for the rest of my life. To realize that those story like adventure don’t just happen to everyone but happen to me too.

So take a break retrace your step and realize those amazing accomplishments you’ve already done, you have a few… But if you really feel you don’t, take control it’s your life, you only have one… Realize there are challenging,attainable goals to be reached, but don’t sacrifice your future self, save and pay for them out right. There are adventures to be had in your own backyard if you are open to the possibilities.

Maybe I’m not such an inept traveler. I think it’s pretty good for 7 years of travel.

– The Roamer

Feel free to share with me your accomplishments. Lets inspire each other.  
Traveling Wallet Images

University Debt Freedom

Hello Sunshine, Hello breath of fresh air, Hello Freedom!

Today was the day, I recently sent in the last payment on my last student loan and today I received the marvelous confirmation that proves it all.

When I started this student loan repayment journey it was 2011 and I was over $46,000.00 in the hole. The school loan companies(government included) in all their infinite wisdom gave me 10 years to pay it all off.  How thoughtful and generous of them??

Let me see I thought I am 23 soon to be 24+10=34. I would be 34 years old when I would finish paying off my loans! 34! really? No thank you. Plus what about all the interest? Lets see if I did my math right it would come out to about $18,000 that’s a total of $64,000 after everything is said and done. Nope. Nope. Nope.

I knew from the very beginning there was no way I was just going to give $18,000 away.  I mean that is what you do when you pay interest. No, instead I figured out what my payments needed be to pay it all off in 5 years. Heck, I even did the math to pay it off in 6 years in case I had some emergency or something but that was it, 6 years was my MAX and 5 years was my goal. That goal included dropping extra cash that came my way with things such as tax refunds.

5 year plan

With the 5 yr plan I would only give away ~$8500 in interest with a monthly payment of $880 and $2500 in tax refund money. This would save me about $10,000 and 5 yrs of worry and stress paying everything off by Jan 2016.

What really Happened

Its Early 2014 and I already reached my GOAL! Paying off my student loans in 3.25 years. I’ve included a table below to show how it all breaks down. Now the numbers on the table are ball park calculations using 7% interest rate but that’s not 100% since really my loans ranged from 4.5% to an ugly 10.63%. Even my payments for year 3 are the average. The way it really went down was starting off with the $880 payments to finish up in 5 years and then upping it all the way to $1480. With extra cash dropped in when it came along (tax refunds) . But I wanted you to get an idea and the difference in the interest rates is no joke even if you do think I’m off $100 its still several thousand dollars difference for every year you add on.

Isn't math fun!

Isn’t math fun!

 My Advice

So here is my advice for any graduating students use the grace period to your advantage and start paying some dollars right away. If it means you are not pay interest great for you.

1. Do the Math

Unfortunately nobody is going to advise you about this, thinking of what’s best for you. Most people will try to get you to extend the life of the loan to minimize the payment per month. That’s like buying a pizza on credit and by the time you actually pay it off it cost you $100 buck. Would you pay $100 for a pizza? Not likely so forget about the monthly payment for a little and do the math to figure out what it really is going to cost you down the line. Some interest rates are so high that by the end of it you end up paying double what you owe. Does that sound like a smart thing to do?(refer to pizza example and hopefully be saying no). I mean you could have gotten a second degree or gone on vacation with the interest you’re paying.

2. Pay Attention

Don’t submit extra money and assume it’s going to the most logical place. I have a secret its not! Yup this is the most annoying thing of all but as you learn about finances you’ll realize that you want to pay off the loan with the highest interest rate first. But nope the loan companies wont do that, that just makes to much sense they will most likely apply it to the loan with (GASP) the smallest interest rate. Well of course they would this means they can keep extracting from you the biggest amount of money. So PAY ATTENTION, CALL as many times as you have to make sure your money is going in the right place. For people with big balances this could be thousands of dollars in extra interest.

I’m really jazzed about this life event, And I hope this makes you realize that doing a little math can save you thousands upon thousands of dollars. ..And even though I am glad I got my education I don’t want to pay anymore then what its worth.

Do you have Student DEBT ? When will you reach freedom? Will you do the math to get there sooner?

-The Roamer Out

 

 

Funding the Journey through Parenthood, Early Retirement and Travel