Savings Challenge Update

I have been remiss in updating my status on the savings challenge so here is an update for today.

The total in the savings account is $1,145.48. This includes a small amount of interest on the account. It is part of a 52-week challenge that was started at the beginning of the year. You can read about it here.

I encourage everyone to find a way of saving some money for specific purposes. It can be a challenge when bills are overflowing and especially when unexpected things happen. Small steps now will make things easier in the future.

I will do better at updating the status of the challenge and hope that this 52-week challenge is productive for you.

Savings Challenge 5-27-2014

Auto-Pay Or Not?

Auto-Pay

Auto-pay is when you set up your bills so they are automatically paid at a predetermined time each month. Got a mortgage? Auto-pay it on the 5th of each month. Car payment? That one is due on the 21st of the month. Utilities? Visa? MasterCard? You can make a list of all your bills and today, you can pretty much set it up to pay them on their due date to avoid late payments.

Is It Saving You Money?

I’ve never liked the idea of setting things up on auto-pay. First, it removes any control over when I want bills paid. I guess some of it is paranoia as well. What happens if somehow, your Visa card is hacked and there are charges on there that are not yours? With auto-pay, it pays the bill when you set it up to pay. It does not care if there are charges on there that do not belong to you. What if you have a question about the charges on your cable bill?

Does Manually Paying Your Bills Save You Money?

For me, I like to have a look at each bill that comes in. For the longest time, I received paper copies of everything. It got to a point where I was not even reading the paper copy. Instead I was looking at the bills online anyway so I stopped getting the paper copies.

Looking at every bill that comes in forces me to acknowledge the amount of money going out. It keeps my hand on my finances instead of ignoring some of the things happening with my finances.

It’s sort of like paying cash for things instead of using a credit or debit card. Every time a $20 bill leaves my hand, I feel it. A debit and credit card feels different – like play money or something.

What works for you?

Median Savings For American’s Is Zero!

I could not help but notice this article: Median American Savings: $0. There is some amount of money all of us can save even if it is a couple of dollars per week. Surely we can do better than this. If you think the government will be there to help you in your retirement, you are in for a huge shock when the day comes. There is no guarantee that you will be able to work until you are 65 anyway. Time to start making a plan for when you can no longer work.

Struggling With Bills

When Do You Get Ahead?

Have you ever noticed that the harder you try to get ahead, more things seem to happen to keep you falling behind?

Today, I brought my car to the shop because a couple of indicator lights came on and the car did not seem to be driving right. After talking to the initial technician, he made it sound as though it was a valve or the transmission that had something wrong with it. I didn’t think much of it since the car still has a warrantee on it.

Nope! Try Again.

This afternoon I received a call stating that it was neither. Instead, a rat, squirrel, or mouse had gotten into the engine compartment and decided to make a home there.

Yikes!

I then get informed that rats and squirrels like to do that and they live near creeks which just so happens to be where my house is. Just for grins, I check under the hood of my other car and lo and behold, there is the beginnings of another nest there.

Remedy

Off to Lowe’s I go to get some bait traps and some spray for the engine compartments. Can you believe that they sell a spray that repels critters like that? Well, the stuff smells terrible. I’m hoping that by tomorrow morning, the smell will be gone and hopefully no more critters. Any other suggestions would be appreciated at this point.

Go Figure

Like I said, every time you try to get ahead, it seems that something always comes up to screw up your plans to get debt-free. I was talking to my wife tonight about just that. When I was struggling so hard in the past, I felt that pain all the time it seemed. Eventually, it did get better. Not in the sense that things did not happen anymore, more like my financial circumstances had changed enough to where I had money to take care of things when they happened. Eventually, I became debt-free and it was no longer an issue to think about.

This is a part of the struggle. Things are going to happen no matter how bad you wish they would not. If you have a savings plan where you have money put back for when things do happen, then they will not be such a struggle.

What are you doing today to make sure that you do not have to use credit when something unexpected happens?

Saving On Mortgage Interest

How Much Interest?

Last October, my wife and I were in a head-on collision with someone who was drinking and had no insurance. As a result, we ended up buying a car that needed to be financed. Still waiting on the lawyers to finish the case. We got some money for the car we had but not near enough to make up for the cost of the newer one.

Also, since moving to this area, we had been renting but in March, we closed on a new home.

Needless to say, we are no longer debt-free at the moment however, we can easily look back and know that if we had not been debt-free before all this came about, we probably would not be able to do what we have done. We were fortunate to be able to close on the house with a 4.125% interest rate.

What is interesting is that over the life of a 30 year mortgage, you can end up paying almost as much in interest as it cost to purchase your home in the first place. In other words, if you purchase a home for $200,000.00 with an interest rate of 4.125%, the interest over the life of the loan can be as much as $149,000.00.

Here are a few ways that you can start to not only save on some of that interest but also cut down the length of your loan by years.

Bi-Weekly Payments

Make half your mortgage payment every two weeks instead of once per month. This does a couple of things. First, since half your mortgage payment is made early, that is two weeks that you are not paying interest on that half of your mortgage payment. Second, there are 26 payments per year that way instead of 12 monthly payments. This means that over the course of a year, you are also making an extra months payment which will go towards principle, further reducing your interest.

Extra Principle Payments

With this idea, you simply make extra principle payments. What I mean is that when you have some extra cash available, you simply make a payment towards your principle. It does not matter how much this is. It could be as little as $7.00 or as much as an additional mortgage payment. For every dollar you put towards principle, it is another dollar that you will not have to pay interest on so the earlier you start, the better off you will be.

Bonus Payment

If you are at a job that pays a bonus, why not put it towards your mortgage? This is money that you typically would not plan on getting anyway so why not use it to help get out from under your mortgage.

Having been debt-free before, I know what it means to not have a mortgage payment. When you owe no one, the stress in your life goes way down. Wouldn’t that be nice?

My Computer Imaging Final Project

Part of my class in Photoshop included coming up with a final project that used the software to produce some digital art. I chose the topic of Analytic Cubism. You might be familiar with Picasso or Braque as the originators of the concept. I had seen some cubism art pieces in the past but had never tried it with paint on canvass. It was a learning process for me to try and figure some of this out. Below, are my attempts along the way to use the concepts of cubism for my art pieces. Preacher1This piece is titled “The Preacher” and uses two images of a person looking in different directions, combining those images and overlapping them to produce. The idea behind Cubism is to try and look at an object or person from several angles to get a full picture of the image. Yeah – it took me a bit to think through that too. Self-Portrait1This piece is titled “Self-Portrait.” I got to this point in the process by looking at several of the works of Picasso again and seeing that he focused on shapes a bit more as well as hatching or gradient in this case. I used the gradient tool to emulate hatching and probably could have done more work on that but I am happy with the way this came out. Cubism Bride1This piece is titled “Bride.” Another aspect of Cubism is the idea or distortion. Rather than showing things in realistic proportions, shapes were exaggerated. Using some of the other aspects of Cubism, I added distortion to this image. Cubism Bottle1This piece is titled “Bottle.” Early Cubism focused on landscapes and objects such as bottles or fish. A key element in Cubism is to only use a portion of the object. Colors are usually subdued as well and I tried not to have too much variety in the colors. As you can see (maybe) there are parts of the bottle in various locations throughout the piece. The bottom is shown, the top, portions of the side. I like this piece a lot. Hope you do too.