A Little Tired

Sorry guys, I’m just a little worn out today. I realized I haven’t had a day off since we were in Kansas. And, although I very much enjoyed going, you can’t completely relax when you are visiting someone else’s house, you know?

My birthday is on Sunday, and I’ll be 24. I’ve been frustrated this week because it seems like it is going to take forever for us to get out of this hole - and get back to just being at $0. We’re not even at the stage where we can accumulate wealth.

The fiancee and I talked last night about some options. Because, really, we should be totally knocking this thing out. The kicker is really the car payment (his). If you add up the car and house payment, we are effectively paying the payment on a $300,000 mortgage, which if you have 20% equity - would be a $375,000 house. And here in Houston, $375k gets you A LOT of house. That thought was incredibly sobering.

But unfortunately, there is not a whole lot we can do about it at the moment, because 4×4 trucks (required for work) are pretty freaking expensive. A ten year old truck with over 200,000 miles on it was still worth $7,000. So at least we know the resale will stay high - but in the meantime, we just have to tuck in even more.

Tightening the Belt - Again

Le sigh.

We’ve pretty much run out of notches in our proverbial belt. Dang. Truthfully, we should be more than fine, but this is definitely a precautionary measure.

I spent a good portion of yesterday trying to figure out how to skim from the budget, which we already thought was pretty bare bones to begin with. The reason? Our roommate will be closing on his first home November 8th, so we will no longer have that income stream. Having a roommate has definitely mad the financial road a little easier for us, and without one, I don’t think I would be able to be making the major life changes I am right now.

So how much did I have to try and cut out? About $800, because we also wanted to lowball what I am making. Here’s what we had to cut:

Gym Memberships: $60, net $40 <— we didn’t use them much, and there’s a local racquet club with a gym for $20 a household

Art: $100 <— this hurt a lot, I keep my sanity through classes

Eating Out: $100

Power: $100 (finally lowered our electric bill!!!!)

Cable: $30

Credit Card Payoff: $388

Reducing the credit card paydown hurt the most, but really, November is a five pay-day month, bonus month (which will help with December), and January we *may* have a roommate for a month, the February is another five pay-day month. So every bit of extra we have will go towards 1) our reserve, and 2) credit card payoff. Plus, by the end of February I should be up and running enough to give up the restaurant, or just have some mad money.

This is definitely not easy, but having everything paid off will be so exhilarating!!!

Weekly Roundup

Well, this week has definitely been about working towards the future. Here is a round-up of my earnings this week:

Restaurant: $65

eBay (net): $24

Squidoo Payout: $34

Antique Store (net): $200

Total: $323

So, not the $400 I am supposed to get every week, but remember I had a surplus last week. I also will have listed about 60 items on eBay by the end of tomorrow with anticipated sales of about $1,300, and a net payout of $500 or so (these are consignments, so I get commission from them.)

Also exciting is that we got our first commission from the sale of an item on our website, www.dorkgamer.com. We are having a ton of fun building these. I know all of you guys out there who like off-line gaming just might get hooked. Okay kiddies, time to wrap up. I’ll probably post again about us readjusting our budget for the anticipated moving of our roommate - no fun. Have a great weekend!

Back to Reality

Well, Mr. Grump and I have arrived back from our buying trip, er… vacation. Arriving with a large load of things to throw up on eBay and some new ideas for our other ventures I am looking forward to this next month or so.

However, the restaurant didn’t schedule me for work until Saturday night, which means at most I will probably work three days next week. Well, I guess I needed a small kick in the pants to get to work on our other ventures and get out of the (relative) security of the restaurant. But really, I’m glad. I feel like I was beginning to rely on it too much for my weekly income. Time to get my butt in gear.

We’re currently waiting to find out what our payout for Squidoo is, it seems they’ve been having some server issues the past couple of days. But our affiliate earnings through our lenses are up to $23.00, and we earned $50.00 this weekend while we were away on a couple of our other websites. Pretty exciting! Now, only $327.00 to go for the rest of the week. I better start listing…

Reason #564734 why it is good to have a (large) reserve and not be in our position of trying to get out of debt:

It looks like our roommate will be moving out into his new home by the end of the month. Looks like that little bit of income will be gone now. Le sigh.

We had to decide to not go to New Orleans for our school’s homecoming this year, despite our strong desire to do so. I guess I am growing up now or something…

Also, between the fiance needing new glasses, both our cars needing their respective check-ups, and the dishwasher kicking the bucket, we are digging into our savings. Well, the good side is that we’re NOT using our cards.

That check from the Antique Booth will be AWESOME. Now, to move onto work…

Weekly Financial Update

I think that I am usually going to be doing this on a Friday - but I will be out of town, so here is my weekly update a day early:

Earnings Paid Out:

Restaurant: $500

eBay (net): $ 45.30

Squidoo: $ 0

CJ: $0

Antique Store: $0

Total: $ 545.30

Doesn’t seem like too bad of a week, until I take into account that we are going out of town through Tuesday.  This means I will be out of the restaurant during the 3 busiest days of the week, when I’m usually guaranteed to make $300.  So that extra $145.30 will actually go towards what I (should have) earn(ed) next week.  We also have a check coming from the antique mall for $260 or so, so between the extra this week and the antique mall, that should bring me up to my goal of $400 next week.  Phew!  We will also get our Squidoo payout on the 7th or so.  I can’t wait to find out what that is.  We have put so much work into it (I’ll post later explaining Squidoo).

Luckily, this weekend is not just a pleasant trip to see family.  We are also going to be picking up a significant amount of inventory to list on eBay, so hopefully we’ll start to see some of that snowballing in the near future. 

It is amazing how difficult it is to get a business started with little to no capital while still trying to earn money and pay off your debts - all at the same time.

And on the Eighth Day…

(This is also on my “About My Goals” Page)

God Made Sweet Tea. -Blind Melon

And on this day, man also realized that he was in debt.

I too, have found both sweet tea and debt, although I am trying my hardest to get rid of the latter. I have a lot that I am trying to accomplish here, and there really aren’t enough hours in the day to do it all. But to give you an idea of what I am trying to do, here are my goals:

• Plan my wedding (June 27th, 2008 is the date)
• Become debt free by April 2008
• Stop working at the restaurant and be working for myself by the wedding
• Eventually stop working for myself (at home) and go back to school for art
• Become a professional artist
• RETIRE by 35

That’s all doable, right?

Now, my definition of retirement isn’t exactly sitting on my butt and watching TV all day. If I am able to become a professional artist and travel the world to paint, I consider that my ideal form of retirement, even though I would be technically working. I think when you stop working and learning, you are dead.

In the meantime, I am taking a class or two for painting, waiting tables, and trying to get my internet business(es) off the ground.

In order for me and my fiancee’s budget to work, I need to make about $400 per week. Right now, these are my various sources of income:

1. Restaurant (waiting tables)
2. eBay
3. Squidoo
4. Affiliate marketing through eBay and Squidoo
5. Antique Booth at an antique mall (soon to be going bye-bye)

So basically, this blog is going to follow my quest towards accomplishing the above goals of becoming debt free, then weaning myself off the restaurant (although it is SUCH easy money sometimes), then going back to school for art and my quest as an artist, and finally - RETIREMENT.

I’m 23 right now, soon to be 24. I think I can accomplish those goals. Most people don’t really begin to save for retirement until their 50s, so why don’t I just start early? If I screw up and have to wait until 45, fine by me!

Appliance Insurance - Security, or a Rip Off?

We’re getting a new dishwasher today. I cannot tell you how exciting this is. We just bought our home a year ago, and within a couple of months of being in the house, the dishwasher broke.

Lovely.

We tried fixing it ourselves, and it worked for a little while, but then it spewed water all over the kitchen.

So, my fiancee had me go out in search of a new dishwasher. Unfortunately, because we have just started consolidating finances and budgets, the pot for home emergencies is pretty low (we’re putting almost all of our extra budget into credit card payoff), and the $400 + $150 for install was going to be a rather large expense.

Then, we remembered something about a “home warranty” with American Home Shield that came with the home when we bought it. After washing dishes by hand for eight months, this was a brilliant thing to remember, especially since the policy was less than a month away from expiring.

AHS was very pleasant to deal with. They sent out a service rep who confirmed our dishwasher was pretty busted, but still possibly fixable, and AHS wound up giving us $215 credit towards a new dishwasher. Since they get dishwashers in bulk for a discount, our total cost with install is about $175, instead of the $550 we were anticipating. Glorious.

But should we renew? Well, for a year of coverage for everything from dishwashers and tubs to the air conditioner and roof, it costs $500 per year.

We decided: $500 is MUCH better put towards a safety reserve for the house in case something big breaks, because unless your air conditioner goes out, it isn’t worth it. Plus, most things in the home (shouldn’t) wear out for at least a couple of years, enough time for us to build a larger reserve.

However, for a house we have just bought that is older (ours is 40+ years old) I don’t think I would consider buying unless the seller had purchased such a plan to ensure peace of mind for at least the first year.

To Renovate, or not To Renovate

My fiancee and I just had the first anniversary of being in our first home. My fiancee chose the home (he bought it just before I moved here) because it was in a well-established neighborhood with good schools and custom built homes with nice trees. Good home values with slow, but steady appreciation.

The suburban dream, really.

Only problem is, we’re both 24. We don’t care about school systems and lots of space. In fact, once our roommate moves out, 2,800 sq. ft. is entirely too big for us. We want a younger, hipper part of town where people are more active and we can walk to a restaurant.

More urban, if you will.

The previous owner did a lot to update the home, but he never touched the most important part - the kitchen. And some of the other things he did, like the bathroom renovation, are ghastly. So, now here’s my question: do we move out, rent it, and rent downtown for a year, then buy downtown? Or do we renovate now, stay for an extra year, then sell?

We want to make some changes before we sell, regardless. The question is, sell now or later?

We bought this home for $135,000 (gotta love cheap homes in Texas!). If we were to rent this house, we can make it cashflow for about net $200-300 per month, so let’s say $3,000 over the year. Plus, if we were renting downtown, we figure we can knock our expenses down somewhere between $100-250/mo. or about $1,800 in a year because we are renting and our power would not be as much. So in a year, we could save around $4,800 in a year by moving and renting.

We figure we have about $10,000 to put it in to get this bad boy up to snuff, so really, I guess our break-even is somewhere around $153,000 for closing costs, etc.

Homes in the area are starting to list (and sell) for around $155,000+. I think it would be worth our while if we could get somewhere in the neighborhood of $175,000 or more for this. We want to be out within five years (for the statute of limitations for rolling capital gains), so I guess we just need to watch the prices to figure this out.

Any thoughts?

Managing Variable Income Streams

I work at a restaurant, serving (ie = waiting tables). I also have some little ventures on the side, like my eBay store, Squidoo, and a booth at a local antique mall. All in all, my goal is to make $400 per week between all of these ventures.

Normally, that is a no-brainer. But still, if I have to take a day off of work , or I’m sick, or something just doesn’t sell, I don’t have money. No *predictably* steady income stream yet.

For Example: I made $350 this weekend at the restaurant. And we happened to sell $265 worth of things in the antique mall, and we have had $85 come through advertising on Squidoo, for a grand total (and the week isn’t over) of: $700.

Not a bad payday this week, especially considering that was my bi-weekly payday at my old job. However, I know that in two weeks we will be going out of town and missing the $350 I would have made from the restaurant, and it has been almost two weeks since we have sold anything in the antique mall. We’ve been averaging $200-300 per month on Squidoo, but still, sometimes that is hit or miss.

So, I could wind up with one week (like the one before last) where I was sick and brought in only $200 total. How in the world do I manage this, and get ahead?

Well, in the past, I would think: “Hey I have extra money!” and go spend some (probably most) of it. But then I would forget I had spent it, and somehow spend it again in anticipation of it coming in. Then, because I had forgotten that I spent it the first time, I would get slammed when all the transactions cleared. My cashflow would be tight, so guess what? The credit cards come out. Well, now that I don’t use my credit cards, I had to find another way, a way to trick myself, if you will.

The trick: I don’t look at my bank account balance.

Instead, I use a budget, and Mvelopes Personal Budgeting Software to see how much I am allowed to spend in different categories.

Then, based on my budget, if I make $200 extra in one week, I’ll put it into savings for the week that I am down $250. I will still probably take $50 of the extra money and put it towards something fun every now and then, but this trick helps me not think I have extra money to blow, which is how I used to operate.

Now I have a cushion for the bad times, and I keep on paying off my debt!