Frugaladventurer's Journal

frugaladventurer · Post by **frugaladventurer** » Sun Mar 31, 2013 12:14 am

Ok - recent events have conspired to finally kick my butt into gear and start keeping better track of things.
I was going along ok, until my ex-husband decided to stick me with the entirety of a $30,000 bill relating to one of our kids (no, there's no legal obligation on his part to pay - moral, yes, but not legal - and I'm not willing to abandon my child as he is).
So - this unexpectedly has depleted my emergency fund, and has made it more urgent that I rein in my expenses so that I can replenish that fund (I'm single and self-employed, so prefer to have an emergency fund that would carry me through at least 6 months of expenses).
I had been paying my mortgage on a ten year plan, but will probably have to suspend the extra payments until I can get my savings built back up or my expenses down. My ultimate goal is to pay off the house in 5 or 6 years and then retire.
At 56, I'm not exactly gonna be ERE, but I'd like to maximize my options for early-ish retirement.
So starting this month, I'm going to track all expenses, and start tightening my belt. (Some things will be confusing - utilities will be high, because I pay all utilities for a household of three - but groceries will be low, because my mom buys most of the groceries for the three of us.)
So - at the end of the month, I'll report the tally of expenses. The lay of the land:

Mortgage of approx. $235k on house worth approx $432k

(currently houses myself, my 81 year old mother - who still works! - and one adult child not currently employed(long story))

Monthly principal and interest on the loan is about $1250 - I had been paying about $2400 a month in order to pay it off in ten years.
401k and IRAs
Defined benefit pension (without COLA) which will kick in sometime between 6 and 12 years from now (depends on my ex's retirement decisions)
No other debts besides mortgage
Biggest budget leak that needs plugging - eating out. Just skipping those Starbucks lattes and brown bagging my lunches to work could save me $200 a month or more. There's probably another $200 in dinners out that I could cut.
Also, I'm currently supporting two kids who do not live at home. One is finally working part-time and reports that he will not need as much from me going forward. (Until he goes back to college next year, that is). The other is pursuing a music career and living quite frugally but may need varying amounts as his living situation changes and as income from his music starts to materialize.

spoonman · Post by **spoonman** » Sun Mar 31, 2013 2:12 am

Thanks for sharing your story, frugaladventurer. It's amazing that your mother is still working at such an advanced age.

Rue · Post by **Rue** » Sun Mar 31, 2013 2:39 am

Great you have no other debts frugaladventurer. Sorry you have lost your emergency fund. Seeing an area you can cut back financially (eating out) is good. If you can save $400 a month just by making your own thats awesome and will build up really fast! Good luck and cant wait to hear how you go : )

frugaladventurer · Post by **frugaladventurer** » Sun Mar 31, 2013 6:55 am

@spoonman - yup, my mom is awesome! She retired from her job as a CPA in her late 60's, then volunteered at the local library. Eventually they encouraged her to apply for a paid position. Now she works all over the city in different libraries, 4 days a week. She's an avid reader and loves it - plus she loves the social interactions it brings. (And the income is very nice for her too - it has really helped make her retirement comfortable). Her mom lived to be 99, so I expect she'll be around for a while - I'm hoping I got those same genes.
@Rue - I've always tried to avoid credit card debt. When my long marriage broke up 4 years ago, I shopped carefully and found a nice house in a less expensive neighborhood. The biggest drain was paying half the expenses for three kids in college at once. They are all taking a break right now, but eventually, I expect to have the expense of another 4 1/2 years of college (2 x 2 years, 1 x 1 semester). Yet another reason I want to build that emergency fund back up.

frugaladventurer · Post by **frugaladventurer** » Sun Mar 31, 2013 8:47 pm

So, stating my financial goals for April, just for my own future reference:
Keep expenses below $4k/mo (except for kids' support) and save at least $1k to emergency savings.
Sadly, this will be achieved partly by reducing my house payment to the minimum (30 year loan) payment, from the 10-year payment plan I was on. Still, I hope to get back on track with that as soon as I have replenished my emergency savings to a comfortable level.
Also - if I CAN keep my expenses to $4k, this is a very good dry run for retirement, as that is roughly what I expect to have in monthly income in retirement (and since my house will be paid off by then, if I can live on the $4k now, after retirement there would be an extra $1200/mo of that which could go to fun stuff like travel instead

)

frugaladventurer · Post by **frugaladventurer** » Mon Apr 01, 2013 6:09 pm

First day of April, I was a good girl and brought food to my office (hard boiled eggs, cheese and crackers, fruit, date rolls) and skipped my Starbucks stop in favor of office coffee.

Seneca · Post by **Seneca** » Mon Apr 01, 2013 6:30 pm

Frugaladventurer- You sound very stressed about the supporting college kids aspect of your finances.
I received no financial assistance from my parents in college, despite having been promised it. I was bitter at the time, but in hindsight, it was better for me in the long run as I was fully independent and already living on my own wits in the real world the day I graduated college. This was a very real advantage over some of my classmates as we entered professional work.
Don't worry yourself to death over this. Let them spread their wings and jump out of the nest. They'll make mistakes but figure it out, one way or another.

frugaladventurer · Post by **frugaladventurer** » Mon Apr 01, 2013 7:18 pm

All three of my kids currently suffer from serious problems with depression and anxiety. The oldest will not be able to work until we resolve a current issue. The middle one IS working but does not make quite enough to pay all his bills - he is the most fragile psychologically (was in an outpatient psychiatric program last year and on meds) and I do not think a "tough love" approach to finances will benefit his mental health at this time.
The youngest is looking for work but has serious OCD problems that make certain jobs untenable. He is also doing quite well with his music pursuits which I consider as valuable as college to him right now and am supporting. (For instance, his music is being played on a BBC radio show and he is one degree of separation from the biggest names in his field).
When they DO return to college, I am obligated to pay my share by the terms of our divorce decree - luckily, my ex will also be obligated at that time to pay his share.
I had planned for their college expenses - just hadn't planned for my ex-husband to bail on helping with these other unforeseen circumstances (which are hugely aggravated by his midlife crisis/infidelity/our divorce/etc).
Believe me, I am not an indulgent parent - I made all my kids get summer jobs in high school (an anomaly in our wealthy neighborhood) and only the middle one has a car (an old beater that was necessary to get to work).

Seneca · Post by **Seneca** » Mon Apr 01, 2013 10:16 pm

I am very sorry if it seemed I was implying you were an (over)indulgent parent! We plan to pay for all of our kids' education, provided they make good choices.
I meet many parents with extraordinary college funding worries and I tell them, from experience, they can relax. We worry more about having to take care of our parents due to their poor savings for retirement than we ever did about getting ourselves through college.
You however, have a different scenario than most and I'm way off base.

frugaladventurer · Post by **frugaladventurer** » Mon Apr 01, 2013 11:09 pm

No worries.

frugaladventurer · Post by **frugaladventurer** » Wed Apr 03, 2013 5:31 pm

Slightly rocky week so far on the budget side. First day of April, spent $12 going out to lunch with best friend (who REALLY needed support, had to go.) Then $10 on wine that night out with another friend (who I really needed support FROM, lol).
Then this morning stopped at Starbucks for a latte - just so tired when I left for work, I succumbed to the temptation. Stuck to food I left at work for breakfast, though.
It's easy to see I was probably spending $500-600 a month on eating out, just lattes and fast food lunches and such. Going to try to keep it down to $50 a week, may start using the envelope system for that.

frugaladventurer · Post by **frugaladventurer** » Wed Apr 03, 2013 5:40 pm