Congratulations: You’re getting cotton balls for Christmas

 I planned on beginning my Christmas savings when I started YNAB so that it did not sneak up on me yet again this year. Since I just came to the glorious world of rainy day saving, I would have to put $83 a month into that category, well I can’t spare that! But I discovered something totally awesome at Winn Dixie, free stuff! Every week, WD has two deals, buy one or two somethings and get all this other stuff free. It usually costs me about $15 a week because I get the toiletry deals. This month I have spent approximately $30 and I have gotten probably $100 worth of items free! I plan on saving all of those items and making gift baskets with those free items for family and friends for Christmas, and because I am using my grocery store budget to pay for the items, I can take that $83 I planned on putting my my Christmas category and put it toward something I really need, which is some fresh paint in my new home! So if you know me, you now know what you are getting for Christmas! Expect things like cotton balls, hair spray, laundry detergent, soap and razors. These are things we use every day and something you never think about as gifts, but if got two months of laundry detergent for Christmas, I would be so happy! Grant that my son will not be very thrilled with Ajax, I will still put about $10 a month in that category for a little something special, (but he will still have one heck of a stocking!) So merry Christmas from me and Winn Dixie!

Lending Club and YNAB – my life savers

Since I stopped posting, we started a small business, borrowed about $5000 on our credit cards, and then we crashed and burned. We were months away from paying it all back and went and did something we thought would push us through early, instead, we sunk right down into the mud I had worked so diligently to get us out of.

As our credit cards slowly rose up, I thought, I have to take my own advice, dig deep into my own foundation. I looked at my credit card APR and thought there has to be a better way. Then I found one, Lending Club.

Lending Club is a peer-to-peer lending club that I started investing in several months ago. You loan people a percentage of their loan, (I stick to $25 notes) and they pay you back plus interest. Lending Club makes its money back in fees, which is usually about a penny per transaction. I literally started with $25.00 a month. I make anywhere from 9-13% interest on the note and reinvest the payments. There are tons of articles about Lending Club so do your homework on it.

Anyway, I decided I would apply for a loan with lending club. I paid off my credit cards, I have a fixed payment, and my APR went down 2/3 of what I was paying the credit card companies. I have a date on when my loan will be paid off and I don’t have to worry about surprise charges or fees. It is an automatic withdrawal from my checking account, (which I was always  terrified to do with credit card companies and have heard outrageous horror stories.) Another plus, my credit score went up almost 100 points! I’m not kidding, and so did my husbands.

Once I was set up, Lending Club sent me this little email offering me a percentage off a purchase of YNAB software, and I am so grateful.

YNAB is simply this, you need a budget. I told my stepdaughter to go to youneedabudget.com and she thought I was being smart, but I was totally serious. YNAB has four steps and is very promising if I stick to it. Rule one: give every dollar a job, in other words, budget down to the last dime. Rule two: save for a rainy day, these are those expenses you know you have to do like car tags, Christmas, and vet bills but aren’t every day, Rule three: roll with the punches, things happen and you may have to change things around in your budget and that’s OK, Rule four: live on last month’s income, create a buffer of one month’s income so that you are no longer living paycheck to paycheck.

Seems ambitious right? Saving a whole month’s paycheck? Start with ten dollars, eventually as you see it grow, you will find ways to fill it. Most people who use YNAB have this buffer in 6-9 months.

I have been using YNAB only about a month now, however, I have everything categorized and I track every expense as soon as I spend them. I was (guilty moment here) spending 10% of my monthly paycheck at restaurants… and not very good ones either. When I saw that, I knew things had to change. I’m getting very familiar with the ole peanut butter and jelly sandwich, and it’s OK, because I have goals that I can climb toward. I cut my grocery budget from $250 every two weeks to $88 every week, saving $74 a month. Just this week, eating from home, I’ve saved $55 in five days!!! If I take what I’m saving at the grocery store and what I’ve saved taking my lunch, I’ve saved $75 this week. Do you realize that’s $300 a month? I can take that $300 and put it toward my buffer, or I can start saving for things I want or need.

We are buying a new house, so I need a washer and dryer and a grill. That $300 I can split between those two categories, but I also want to put a little toward my buffer, so I will put $20 of this in my buffer, because I want to stop living paycheck to paycheck, and YNAB is helping me do that!

You get the drift, when you see what you are spending in black and white and you realize what you can have if you cut and save and delegate your funds, you can save your life!

Confessions

It has been quite some time since I posted anything on this blog. Frankly, it’s been two years. I can go through my posts and see all of these great money-saving ideas that I AM NOT USING! I admit it! I’ve slipped, I’ve slid, I’ve crashed and burned. I am finally at a point in my life that I must take my own advice. Perhaps in order to stay on track, I must start here, at the basics, and work my way forward.