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Monthly financial check-up

How did you do in January? We finally sat down together with our financial advisor and got some things straightened out/set up for our businesses and retirement savings. It feels good to have that all in place and to now be saving 10% of our income towards retirement. Lord-willing, this will allow us to not be a burden to our children financially when we are old and feeble someday!

We’re now working hard at funding our children’s educational savings accounts. We decided to do something rather out-of-the-ordinary and actually fund them in the amount we’ve both agreed upon in one lump sum, rather than just put in a yearly amount. Since our children are still young, we realized that compound interest is going to play out favorably for them over the next 12 to 17 years, so it would be less expensive for us to go ahead and just put in one lump sum for each of them now. This also will allow us to have one less thing to have a budget category for once we are finished saving the amount we’ve determined we feel we want to put towards their education.

We are not putting this money in typical educational savings accounts, even though it’s a little less tax efficient because we don’t want it to only be ear-marked for college. We definitely expect that at least some of our children will attend college, but some may be more entrepreneurial and may want to start a business in high school or pursue learning outside of college (such as a hands-on internship).

While I definitely think that college is a wise choice in many circumstances, since I didn’t go to college, I tend to be rather counter-cultural in believing that traditional college is not necessarily a necessity for every single young person. We hope to encourage our children to seek God and determine what their own bents, interests and passions are and then we want to help them out financially as they pursue those — whether that be college or some other route.

At any rate, here’s our financial goals update for January:

1. Give generously to the needs in our community and around the world. (This is an ongoing goal that we’re seeking to make a priority each month so we’re not checking it off.)

2. Pay cash for a replacement washer and dryer for our very used set. (DONE)

3. Pay cash for a replacement for Jesse’s van. (DONE)

4. Pay cash for a couch for our basement family room. (DONE)

5. Pay cash for bunk beds for the girls. (DONE)

6. Fully fund our IRAs. (DONE)

7. Bump up our retirement savings to 10% of our income. (DONE)

8. Fund our children’s educational savings.

9. Double our Emergency Fund Savings (Instead of having around six month’s worth of expenses set aside, we’re planning to set aside a year’s worth of expenses.)

10. Save 40% towards our goal of paying cash for commercial real estate.

We’d love to hear about your recent financial goals and successes! You can post about it on your blog and leave your link in the comments. Or, just share about your progress/goals in the comments. Let’s all keep each other accountable to be better stewards of our resources!

We Paid Cash! :: Seven Months to Invest in Our Business

We paid cash!

A testimony from Susan from Frugalouis

On a date night shortly before my husband’s computer programming contract ended, we got to musing. What if he just took time off after this contract instead of trying to jump right into something else? What if we were purposeful and set aside a period of time to invest in our own business? Could we do it?

My husband Ed wrote and sold software long before we married. This business brought in a very part-time income for us, but not nearly enough to support our growing family. If we ever were to get to the point of being fully self-employed, we both knew his software needed to be available on the web.

And so “Project GROW” was born: Get it Running On the Web.

Seven months for a family of four to choose to live on little-to-no income, with the goal of being self-employed and flexible down the road.

Here’s how it worked for us:

  • That night at the restaurant we hammered out a detailed schedule for our family. Included in each week was about forty-five hours of time set aside for Ed to work on Project GROW. We knew that this way if (when!) things ate into his time, he was still likely to get in at least forty hours a week.
  • We made sure to schedule in time for date nights and our family. With other things being tight during this time, we wanted to maximize time with Ed/Daddy.
  • We set goals and a time-line. This included how long we were planning to devote and some markers to guide us toward completion.
  • Our budget became our friend. Since we were blessed to go into Project GROW with a fully-funded emergency fund, we knew we had the resources at our disposal to live without income for several months. However, we were not guaranteed that Ed would find work immediately after Project GROW was complete. With this in mind, we set a budget that was significantly less than our spending prior to Project GROW. This budget amount became our “income” for each month.
  • Money-saving became serious business around our house. While I had been couponing and following MoneySavingMom.com for about a year prior to this, now we really needed to stretch the bucks. Our commitment to using cash increased as Project GROW progressed. While we had gone into the project paying off our one credit card in full each month, by the end of our seven months we chose to be completely credit card-less.
  • We knew we were in this as a team. I think this was a crucial piece of the equation. Together we came up with the name “Project GROW”, which ended up being a great “handle” for all the times we referred to this huge adventure our family was on. We started out dreaming about Project GROW together, and we planned our schedule together. And most importantly, together we prayed about this undertaking.
  • My husband knew the skills he was learning and refining would make him more marketable regardless of how our new product sold. In many ways this was our “safety net” for investing so much time and money.

What happened is that we only made about three months’ worth of transfers out of the savings account. God provided in amazing ways, including a small inheritance and simply making our money stretch.

The year before Project GROW, we had the largest income we’d ever had as a couple. Living frugally during that time of plenty helped us prepare for this chosen time of drought.

We Paid Cash Build BusinessOur seven months of investing full-time in our family business are now passed. Project GROW is mostly complete, and the web-based version of our product will be debuting soon. We realize that it will likely take years for us to get to the point of self-sufficiency. But imagine what it will be like when we do!

As a couple and a family, we’re glad that we stepped out and took a calculated risk toward financial independence. Instead of wondering and wishing, we did it, and now we’re excited to see what’s around the next bend.

Susan lives in St. Louis, is married to Ed and stay-at-home mom to their two little ones, ages one and three. She blogs at Frugalouis, “a frugal St. Louis Mom’s guide to the city”.

Have you saved up and paid cash for something — large or small? Submit your story for possible publication here.

Frugal Failure: So much for my beautiful Cinnamon Sugar Bread!

You know how I promised you the Cinnamon Raisin Bread and Cinnamon Sugar Bread recipe this week?

Well, um, I thought I had tweaked the recipe and worked out the perfect combination of ingredients. However, when I went to make a final batch to make sure it worked correctly, I made a serious mistake: I forgot to put the paddles in the bread machine!

So I ran the whole dough cycle without any paddles. Which, ahem, is a rather pointless exercise.

When I finally discovered my mistake, it was too late in the day to run another dough cycle and bake the bread, so I just let the ingredients sit until the morning.

In the morning, I tried to run the dough cycle again, this time with the paddles in. Only (you’re not going to believe this!), one of the paddles wasn’t in all the way, so only half the dough got mixed up.

Determined not to waste the ingredients, I ran the dough through yet another short cycle. It rose and rolled out normally and baked into a beautiful loaf.

But the looks of this beautiful loaf were very deceiving, because when I cut into it, I found a practically hollow loaf.

Oops.

The girls and I ate the bread, regardless of the mishaps, and it was still quite good. But I thought the filling needed a little more tweaking and, obviously, I need to get my brain cells connected better so I can make dough correctly.

I promise I’ll experiment some more over the next few days and hopefully be able to present a delicious and near-perfect Cinnamon Raisin and Cinnamon Sugar Bread recipe next week. Hopefully!

Note: Apparently, I’m not the only one with bread issues this week, since Tammy also had a similar mishap. I guess I’m in good company. 🙂

Today’s Dillon’s Shopping Trip

The roads finally cleared of snow enough for me to venture to the store today, so I headed to Dillon’s with Kaitlynn. Here’s what we got:

7 cans of tomatoes — on sale for $0.49 each when you buy 10 participating items, used 2 $0.80/3 coupons,$0.26 each after coupon

10-lb. sack of potatoes — marked down to $1.79

Quart of Silk soymilk — marked down to $1.49

1 tube Colgate toothpaste — on sale for $0.98, used $1/1 coupon, free after coupon

1 8-oz. block of Cheddar cheese — $1.77

1 Dannon 4-pack smoothies — marked down to $0.99, used $1/1 coupon, free after coupon

1 Yoplait yogurt — used free coupon

1 organic Mango — $1.79

1 4-pack of Activia yogurt— on sale for $1.88, used $1/1 coupon, $0.88 after coupon

Gallon of milk — $3.18 (Ouch! Anyone else noticing high milk prices recently?!)

Balance Bars — on sale for $0.50 each when you buy 10 participating items, used $1/3 Balance Bars coupon, $0.17 each after coupon

My total, after coupons and the Mega Event discount, was just shy of $15.