The Games We Play: Hiding Money From Myself

When looking for ways to save more money, use whatever works. Mind games are bad for relationships but they can be helpful with money, sometimes.

I hide money from myself.

Instead of spending coin, I save it and only use bills for most of my transactions, putting the coin into my piggy bank. When my pig is full I take it to the credit union where they have a free coin counter. The money goes to my vacation savings which I keep in cash.

In order to have access to the free coin counter at the credit union I have to have an account there. I once thought to make that my primary bank but their service was terrible so I never did but I kept the account. Not just for the coin counter but also because they have an ATM at my work that allows withdrawals in increments of $5. I hide my new car fund there. I paid my last car off in six months but next time I want to pay cash.

I made a fake withdrawal in Quicken to create a cushion so I don't accidentally overdraw my account (although linking my checking to a savings is the real overdraft protection). It is enough money for a minor house repair so that is my "minor house repair" fund. I've been doing that for so long that I really don't think of that money as real money.

Years ago, I started saving for a new wardrobe, in cash. This was supposed to be my reward for dropping a size. I did the same thing the last time I dropped a size but I have stagnated at that size so long the clothes I bought are worn out/wearing out/getting unfashionable. I have the $1500 sitting in an envelope but I think I should just put it in the bank so at least it can earn a little interest.

I am a union rep for my work area. Every month we have a meeting for which I am paid $40, less than my regular hourly wage but it is still money. I save it up in my "buy something frivolous without guilt" fund. It is cash in an envelope.

My mom gives me cash for birthday and Christmas. I used two years' worth of money to buy a little iPod stereo but I have another year's worth sitting in an envelope, in cash.

Notice anything here? That's a lot of CASH! Given inflation as a constant, actual cash money is a depreciating asset. The $1500 I put away for clothes 2 1/2 years ago doesn't have the same buying power now (current economy driven sales notwithstanding). If I had put it in an ING savings at 2.4% I would have an additional $92! That's a nice pair of shoes!

When I was financially very immature, running up credit card debt and impulse spending, I needed to hide money so I wouldn't spend it. Hiding money was part of the beginning of my path to changing my financial behavior. But now I am thinking that I am beyond games and that I am financially grown up enough to stop hiding my money. So now I am thinking about how to go about it. More on that in a later post.

Sharing Saves - Having a Roommate

When you want to save money, having a roommate can be a big money saver. Count the ways:

✪ Money - The rent money is additional money you can use to pay down debt or increase savings. This is making the difference in enabling me to pay extra on my mortgage without having to eat ramen. Ramen is yucky.

✪ Shared costs are less for all - the fridge has to be on all the time no matter if it is holding food for one, two or ten. The electricity and water bills will be more expensive but the average cost per person is still less for utilities.

✪ Less is better - the more space you have to put things, the more you will buy. Having a roommate means one less room to fill with extra junk. Reducing your possessions means living more simply which makes it easier to spend less. I had to get rid of a lot of stuff and found that I was happier when I did. I have to be careful when I shop because if I buy something there has to be a place in the house to put it.

✪ Many hands make light work - Ideally, all members of a household contribute to keeping it clean. There are more dishes to wash and the bathroom gets dirty faster but if everyone is helping it is easier. No housekeeper or gardener needed! My roommate cleans the shower, I do the rest of the bathroom. One of us always remembers to get the bins out on trash day. We all work in the yard. I like to clean the kitchen, she likes to clean the floors. It's great to not have to be the only one cleaning the litterbox!

How I ended up with a roommate

If someone had asked me to consider having a roommate I would have said "No, way!" I paid extra in college to have a single dorm room, then got an apartment by myself. I have always been shy, private, and found pleasure in solitude. Why would I ever agree to have a roommate, stranger or friend? Never!

A few years ago my BF and I decided to live in the same city again which meant we had to find a place to live. The small, dark, unheated "hobbit hole" I was living in at the time was totally unsuitable for the both of us (or even me for that matter). We lucked into a great rental: a 3 bedroom 2 1/2 bath house in a decent neighborhood for only $2000/month, a fantastic deal in the Bay Area.

After we signed the lease, however, my BF was offered a six month tour in Kuwait. He was going to have to look for work when he moved to live with me so it was a great opportunity for him to make a nice chunk of money to pay off his debt and pay the bills while he looked for work. Six months alone with three bedrooms seemed silly to me. A friend I have known since high school was looking for a new living situation at the time so we decided that she would stay with me. She and my BF got along really well so when he came back she stayed. The house was plenty big enough for all of us.

Then I bought my own house. We went from three bedrooms to two, 2 1/2 baths to one, and less storage. But by this time I had adjusted to having people around and knew I could tolerate it. In fact, I actually like it a lot. I also liked the money. With the gigantic mortgage I was taking on having some extra money seemed like a good thing. So my roommate came along. (BTW, my roommate is the one who gave me the nickname "K-money" because she knows how much I like to save money. Even my BF calls me K-money sometimes. Sheesh!)

How my sister ended up with a roommate

My sister was renting a tiny two bedroom house (about 700 sq ft) and had credit card debt. She didn't want the long term roommate situation I had but was willing to part with some of her space and privacy in exchange for cash. We lived not too far from a major university at the time. Lots of students go to this university for internships, etc that are only a semester or less. My sister rented out her second bedroom to a student for a couple months, then to another student for a few more months. The extra money helped her aggressively pay down her debt and the short term rental meant that she wasn't locked into having a roommate indefinitely. If my roommate ever left I would consider this option, definitely.

My sister and I both work in health care so we know that there a lot of travel nurses who need a place to live. Their employers provide an apartment or stipend but some of them would rather take the housing stipend and find someplace cheaper to live so they can make even more money. It is another short term opportunity to make some extra money.

Not everyone has enough space that they are able to get a roommate. Not everyone will luck into finding a person to live with who they completely get along with, either. But the idea has potential and is worth considering if you need/want extra money.

Do I want to climb the CD ladder?

When I was building my emergency fund I just focused on having the money, not how I would take care of it once I had it. As my fund grew bigger, I started to think about where I would keep all that money. It is for emergencies so it has to be pretty liquid and accessible. Interest rates for savings are so low now that I almost might as well keep it under my mattress. Right now I am making 1.01% - it's laughable! The solution I came up with was to put one month's expenses (my E-fund is bases on four months of expenses) in a six month CD. Two months later I put another month's expenses into a CD. In another two months I did the same again. I am keeping one month's expenses in the savings. Every two months a CD will roll over, this month that is happening for the first time. The short term on the CD means that while I don't get as good of an interest rate as a longer term CD I still get more than with the conventional savings; also I won't have to wait that long if I anticipate needing the money in the near future.

Recently I heard about CD laddering, where you take a bunch of money, divide it into five portions, and every year you buy a five year CD. After a few years you have a CD maturing every year. Because the five year interest rates are higher the return is better but some of the money is accessible every year. I think that is a good idea but I'm not sure I want to do it, at least not with my emergency fund. Maybe with some other money. But the idea has given me something to think about.

Sidenote: I used to work as a bank teller in the early 90s. I remember looking at the rates for a 20 year CD and they were 12%. I think 5 year rates were around 7%. Thinking about that and looking at today's rates makes me want to gag. If I could have cobbled together $1000 back then how much money would I be looking at the end of 20 years? I don't even want to calculate it, I might cry.

When Mr. K$ is away, Miss K$ likes to play

Every so often Mr. K$ has to go out of town for his job for a week or two. For some reason, every time he goes away I want to make changes at home. I'll change things, do a big house cleaning, rearrange the furniture, etc. I think it is fun to make improvements and surprise him, unfortunately Mr. K$ does not like surprises.

The time I took a sledgehammer and tore down the decrepit, ugly dirty brick BBQ/fireplace in the backyard (it was on our eventual to-do list) did not go over well, nor did the fact that I had all the old bricks and debris hauled away. But it was so fun! I would love it if I went away for two weeks leaving the house a disaster and returned to find the house sparkly clean and a major bit of work accomplished, but that is just me and not him. I make pouty face about it but I understand and am trying to be better.

So now that he is gone again, what am I to do? I have all this energy! I think I feel this way because I like the idea of a short term goal with a deadline. I really work better with a short deadline. My best work in college was started the day before it was due. Thinking about how my extra payments will pay off my second mortgage in only TEN YEARS instead of thirty, while a very good goal, just isn't as fun.

So what did I decide to do while he is away? Purge my stuff, as I mentioned in my last post. I know that purging only my stuff won't bother him at all. My goal is to have so much stuff gone that I actually have room for new stuff. I'm not planning new stuff, just breathing room. Credit card receipts so old the ink is faded away? Gone! Books I can find at the library if I want to reread them? Gone! Materials for craft projects I'll never get around to? Going! Rearrange the living room? Yes, that too, but at least I warned him this time. I'll have to empty out the drawers of big furniture pieces before I move them so I'm sure some of the contents of those drawers will land in the giveaway pile. Why do I have a huge collection of gift wrap when we don't give lots of gifts in my family anymore? I could pare it down to 20% of what I currently have and still have enough to last for many years. It's going! Why do I have four identical spools of thread in odd colors I am unlikely to use? I'll keep one and get rid of the rest.

I am having a FABULOUS time cleaning out my junk. My trunk is packed with stuff for Goodwill, there is open space visible in my basement, and I don't have trouble shutting any of my dresser drawers. I'd like to have the trunk of my car filled a second time and the recycling bin full by the end of the weekend. Once upon a time I had so much extra stuff that the big house I used to live in wasn't big enough and I had to store many many boxes with my parents. I keep having these periodic purges and I don't buy nearly as much stuff any more so I have less and less stuff and feel better and better about it. I don't store anything with my parents now and soon I will have all my stuff stored in drawers or on shelves, no more piles in closet or basement. Next I want to get rid of so much stuff that I can get rid of some extra furniture that I use to store the extra stuff. I already banished one bookcase, can I get rid of an extra desk?

Cleaning out the White House and my house, too.

Here is to hope and a new presidency! I am cleaning out closets and my basement in honor of cleaning out the White House ( well, it is actually a happy coincidence). Five bags of usable (just not by me) items sit at my door waiting to depart tomorrow with more to come.

New web address

Welcome to the new Three Rooms and a Path! I decided to make a new blog and use the title of my blog as the web address to make it simpler and more logical. I should have done this when I first started but I was lazy so I am doing it now before I have too many posts to move over. If there is a better way to do this then just copying and pasting every post and comment I am not aware of it so it looks a bit awkward but will be better in the future.

Frugal living made better (and greener!) with Traditional Skills, but where can you learn them?

Among the ways to live a greener and more frugal lifestyle are growing food to eat and making things for the home.  The home garden can cost a lot less than organic produce from the store. Homemade or repaired items for the home can also save over buying new.  Recycling unwanted or broken items into new is green, too!  One problem that many people nowadays have with this concept is that they lack what were once common skills necessary to grow or make things for themselves.

How many of the following things can you do?

*grow vegetables
*canning/preserving
*cook
*make perfumes/essential oils from plants
*compost yard waste
*sew simple household items (curtains, napkins, pillows)
*sew, or at least alter, clothes (can you hem pants?)
*knitting, quilting, embroidery, crochet
*shine shoes
*build furniture or basic woodworking
*metalworking, including forging, welding, soldering
*basic plumbing
*car maintenance and repair

Many of these skills, if not learned in the home, used to be learned at school.  Middle and high schools used to have home ec, wood shop, metal shop, auto shop, and crafts class.  In my area and I'm guessing nationwide, many of these programs have been eliminated due to budget cuts and new requirements to teach technology and Leave No Child Behind.  Even where they exist kids are often pressured to skip shop in favor of classes that are better for getting into college.  I sure was.

Now that I want to use them, where do I learn these skills?  There are many places!  I now know where to learn most of these skills in my area, where did I find them?

1)  Local adult education programs teach a wide variety of skills.  I've taken classes in stained glass, calligraphy, manuscript illumination, flower arranging, altering clothes at home, picture framing, woodworking and metal shop.  I live in a large metropolitan area that contains many smaller cities and towns, all with unique offerings.  I just Googled for adult ed in every single town in my area.  They are also usually pretty low cost.

2)  Libraries often host workshops or have a bulletin board with advertisements for local offerings.  My nearby library hosts a FREE weekly knitting class and a rug making group.  They have advertisements for other classes such as gardening.

3)  Community centers often have classes.  I can learn pottery, guitar, and Tagalog at mine.

4)  Newspapers, especially neighborhood papers, often have listings for activities.  Gardening and cooking classes are common.

5)  Local nurseries often offer free or low cost workshops on such topics as pruning roses and trees, composting, growing native plants, the water wise garden, and more.

6)  If you have an interest, look on the internet.  Either Google it or look for a society or organization that focuses on your interest.  Pottery, calligraphy, art societies and others often have a link to places you can learn locally.  That's how I found out I could learn blacksmithing in my area.  I also found a drop-in workshop for learning to paint traditional icons using hand made paint just like the Old Masters did.  I sure couldn't learn that from art class in college.  There's even a group that builds robots and another focused on building things powered by steam!  Who knew?!

7)  Craft stores usually have workshops.  My local yarn store will teach you how to knit using hair from your pet.  That would be extremely green!  Michael's and other chain craft stores have classes in picture framing and cake decorating.  I refined the quilting skills learned from my grandmother at a fabric store.  My mom took cake decorating when we kids were little and as a result she was able to make the most amazing cakes for our birthdays for very little money.

8)  Many community colleges offer short courses, or even semester length courses, in basic skills such as basic home repair and auto repair.

9)  Churches will sometimes host classes.  An Episcopalian church near me hosts monthly art and language classes.  I study icon painting at an Orthodox church.  You don't have to stick to your own faith when it comes to attending life skills classes unless you find that morally intolerable.

10)  The internet is a resource for learning skills.  I personally find it hard to learn that way but if you are so remote there is no other option, there is that at least.  Check out YouTube.  Many videos are posted with demonstrations of skills; that's a bit better than following written directions or drawings.

Now before you complain that you live in a small town and only big cities have that much variety, I will admit that is true.  Yet many smaller areas still have a good selection of classes.  Several of the classes I mentioned above I took when I lived in a city of less than 100,000 in the South.  A couple were offered where I lived in Wyoming (and that is pretty isolated!).

These skills can also be used to benefit others and create a stronger connection to society.  As an example I once solicited donated money to buy materials that I used my sewing skills to turn into a basic layette set for every baby that was born at the hospital where I was working for an entire year (it was a small hospital, with many low income patients, but I still had to sew over 300 sets!).  There are also groups that make quilts for child victims of natural disasters.  Or how about donating your produce to a food bank? My neighborhood hosts produce exchanges in harvest season.  I trade things from my garden for things I don't grow.  People who don't garden can buy produce with proceeds going to a particular neighborhood beautification project, and everything left at the end of the day goes to the food bank.  The options are limitless.

Making things yourself is often cheaper than buying new, and when it isn't cheaper it is still good to know you are not using something made in deplorable working conditions with questionable materials in some foreign country. There is also a strong sense of satisfaction that comes from having skills and using them to make your life better.

POSTED BY K-MONEY AT 10:00 AM

COMMENTS:

Miss M said...
My old work had a bullpen style office (almost no walls/cubes) and all the guys around me were Filipino. If I stayed around much longer I would have absorbed Tagalog, they chattered away all day long. It was like the Far Side cartoon what dogs hear, blah blah blah sit blah blah...only it was blah blah blah Washington Redskins blah blah blah! They'd usually be talking sports, or at least that was my guess. I wish I were stronger with foreign languages.

Nice list, I can do a few of those things but I'm leaving the welding to Mr M!

JANUARY 17, 2009 3:23 PM