Tuesday, June 17, 2014

Money Hip Chats: Vacations

It’s time for another Money Hip Chat. I tried to think of things that are annoying to budget for, and I’m going with vacations. Lisa, what comes to mind first when thinking about vacationing on a budget?

Lisa: I think the foundation of vacationing on a budget is to adjust your expectations. I think a lot of young couples and families run into trouble because they’re trying to keep up the kinds of vacations they had prior to getting married, when it was on their parent’s dime. That’s simply not possible (or wise) when your income is significantly less. Another related issue is when extended families want to do grand vacations that may fit within their budget, but simply don’t fit your budget. It’s a tricky business because turning them down can be a source of family drama. I think that’s why having a budget is so important--it sets a clear expectation. An example conversation you might have to have with older siblings or parents: “Our annual vacation budget for the whole year is $500. That’s simply not enough to join you on a cruise and have enough money left over to visit at Christmas. We’d love to spend time with together--what if we did something else?”

Lauren: That is such a good point. I think it’s important to remember that the point of vacations is creating memories with people you love, and that can be done without spending a ton of money. I’m not knocking great vacations. If you can fit it in your budget, then go ahead. But if it just doesn’t make sense financially, then don’t stress about missing out, because you can still create those memories doing something less expensive-- like camping, a road trip, sharing a beach house/cabin with friends or family, etc. One of the expenses that really seems to add up on vacations (especially with kids) is food. How do you save money on food on vacations?

Lisa: We definitely do a lot of shopping beforehand to make sure we’re stocked up on fruit, water, and snacks for the car (gas stations snacks are crazy overpriced). We also take advantage of whatever food the hotel is offering for free. In addition to breakfast, the hotel we just vacationed at offered a “Manager’s Reception” with a full dinner Monday through Thursday evenings. For eating out in general, rather than buying overpriced combo meals, we buy individual items (I don’t like soda anyway). What do you do?

Lauren: Mostly we’ve just visited family, and our moms have cooked for us :) But Aaron’s taking a month off of work before school starts and we’re going to try and fit in a few day trips. In general, I definitely think eating local food on vacation can be a wonderful source of memories-- but that doesn’t mean you have to go all out for breakfast, lunch, and dinner every day. I basically snack all the time, so when I’ve traveled in the past, I brought a box of Clif bars that I could eat on the go. It was a Costco sized box, and packing it was fine because it freed up some weight/volume for souvenirs on the trip. I still enjoyed eating in restaurants and at street vendors, but having food I brought myself meant I didn’t have to buy food on the go for every single meal, which saved money. 

Another thing we've done to save money is pooled our frequent flyer miles on JetBlue as a family. Don't forget that even small children can earn miles, so being able to consolidate can really help. If you or your spouse travel frequently for work, those miles can be especially helpful as well. Pooling all of our miles got us 3.5 round-trip cross-country tickets for a family reunion this summer. We ended up spending only $300 out of pocket to get all four of us from Boston to Oregon and back again.

Share-- How do you save money on vacations? We'd love to hear from you in the comments below!

Tuesday, June 10, 2014

How to Create a Killer Running Playlist

Pin this for later-->  http://www.pinterest.com/pin/195765915027290042/

Okay, so when it comes to the writing staff here at MHM, Lauren is actually the true runner. I've never ran any races longer than a 5k (lame, I know) and Lauren has run every race from a marathon on down.

So why would I be audacious enough to give running advice? Because I feel like running is easy enough when you enjoy it and/or are athletic. But to come home with a medal when you kind of hate running and have no natural ability? Bragging rights.
(Disclaimer: There were only 14 runners in my particular category--so really not impressive, but that hasn't stopped me from being extremely proud of myself and posting this picture to Instagram).

Create a Killer Running Playlist

What's the secret to getting a lazy runner like me to move at a decent speed? Create the perfect running playlist! No joke, when I decided to revise my playlist for the first time in ten years (using a bit of science), I quickly dropped my mile times from 10-11 minute miles to 8-9 minute miles (I ran a 6:43 minute mile on the treadmill, but I'm pretty sure treadmill PRs don't count).

The Trick--BPM

It's all about the Beats Per Minute (and running to the beat). Back when I bought my fabulous zero-drop Altra running shoes, I carefully read the guidelines provided by the professional super-runners who developed the shoes. The advice that stuck out to me (especially because I've had serious knee problems in the past) was to "run softer" using shorter, quicker strides. No matter how slow you are, your should aim for a cadence of 170-180 strides per minute. So I decided to re-evaluate my running playlist. Turns out most of the songs I thought were great, fast-paced running songs were only about 120 BPM and (since I run to the beat) were therefore slowing me down

My Secret Weapon -- jog.fm

Jog.fm is an awesome tool. You can search for songs by title, BPM, and mile time. I had to work my way up to 170-180 BPM (I started at 150 BPM), so I used it to find songs along the way. I highly recommend using it to build your playlist.

My Running Playlist

Here's a few of my favorite songs that are all between 175-182 BPM:
I was so nervous for my little 5k race, I took this picture beforehand, sent it to my family, and told them to pray for me. Seriously. But the playlist payed off--I hit my goal!
Good luck! Have fun updating your playlist and watching your mile times drop!

What are your favorite running songs?

Tuesday, June 3, 2014

Budget Boot Camp: To Do #5 - Budget for Irregular Expenses

We're now officially getting into "budgeting all-star" territory. If you budget successfully for irregular expenses, you're well on your way to having a budget better than 95 percent* of the American population. Most people budget for regular expenses, but when the opportunity to take a vacation, give Christmas gifts, or pay to get the car fixed comes, there's nowhere in the budget for that money to come from, so they resort to their emergency fund, credit cards, or savings earmarked for other purposes. But not you. Here's how to budget for irregular expenses.

If you're just joining us, don't forget to check out our other Budget Boot Camp posts.

To Do #5: Budget for Irregular Expenses

Step 1: Brainstorm potential expenses and their amounts

Take a moment to brainstorm those irregular expenses that crop up during the year. Personally, when it comes to creating expense categories, I've found that it's actually easier to be specific (within reason) than general for a few reasons. First, it's easier to figure out how much your going to spend if you break it down into sub-categories. For example, you're probably going to come up with a more accurate amount for "gifts" if you've broken it down by holiday. Find out if there's anywhere you can save online as well using a cashback extension For example, just like eye care, you will know when you are due for a check-up. By planning ahead and keeping money aside in case you need new glasses, then you can make sure you can afford some that you really want. To find some fabulous men's glasses, find it here.

Second, it's actually easier to categorize when things are specific. If you have a category for parking at the airport, you're not going to waste time trying to decide if you need to use your monthly parking budget or your irregular travel budget. If you're using our free budget template, we've gone ahead and brainstormed a lot of categories for you (listed below), and left you with spaces to create your own custom categories. Download our free template on our Facebook page. Do any of these apply to you? Do you need to create additional categories?

  • Insurance: Car, renters/homeowners, medical, dental, life, disability
  • Car Related: Registration, safety inspection, oil changes, car washes, excise tax, car repairs, miscellaneous parking
  • Travel: Plane tickets, car rentals, gas and tolls for road trips, parking at airport, transportation to airport, food for travel, checked luggage fees, entertainment on vacation
  • Gifts: Wrapping supplies, birthday, Christmas, wedding, baby shower, Mothers Day, Fathers Day
  • Medical: Copays, parking at the doctor's office, flu shot, prescriptions, contacts/glasses, dental bills, vision bills
  • Memberships/Subscriptions: Costco membership, Amazon Prime membership, newspaper/magazine subscriptions, anti-virus software subscriptions, museum passes
  • Children's classes/activities: Swim class, preschool
  • Hobbies: Race fees, craft supplies
  • Photography: Family pictures, photo books
  • Education/Career Related: Tuition, books, CPA renewal fees
  • Clothing Related: Dry cleaning, clothing purchases (although I use a fund to keep track of this-- we'll talk about this more next month)
  • Miscellaneous: Hair cuts, stamps, credit score requests, will software, cash withdrawal

Now assign an amount to each expense. If you don't know the amount, estimate it. As you live with a budget, it will get more and more accurate over time.

Step 2: Divide the total of that expense for the year by 12 and put it into your monthly budget. If you're using our free Excel file, available on our Facebook page, you enter the amount for the year in the total column at the end, and the monthly amount will automatically populate into each month's budget. As you enter the actual amount each month, you'll see the actual total accrue in the total/actual column. If you are using Mint or Yodlee, I believe there is a "rollover" feature that you can use to rollover the unused amount in each budget to the next month. However, in the month when you do use the accrued funds, it will show you as "over" budget if you go over the monthly amount.

Step 3: Save that money each month so it's there to use when you need it. There are several ways you could do this. We send the amount we budget each month for irregular expenses to a separate savings account, and then transfer the actual amount spent on irregular expenses back into our checking account each month to make sure we don't "accidentally" spend that money on other stuff. I believe Lisa pays large irregular expenses out of that separate bank account directly. Or you could just hold your budget in the other areas and float the amount accrued for irregular expenses in your normal checking account (works better when you're not on a tight budget). We'll talk more about cash flow strategies with irregular expenses later in our budget boot camp.

Step 4: Refine over time. It's not going to be perfect the first time. It's a combination of both trying to live within your budget and improving your ability to forecast your spending as you continue to track it that will give you a workable and effective budget.

*I made up the 95 percent-- but seriously, it's got to be high.

Share- What are the random expenses that you always forget about in your budget?

And for the mom products I'm loving: Since we'll be moving to New York City in a few months, and space will be TIGHT, we put our baby in a pack 'n' play. The combination of this mattress pad (we're using the bassinet attachment, so we didn't want a thick pad that would make it too high) and these oh-so-soft crib sheets actually makes it a really great and comfy space. 

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