Category Archives: Uncategorized

A Beautiful Wedding…

Back in mid-March, one of my good friends got married. He and his now-wife had a beautiful wedding ceremony and an eventful reception.

Not to detract from the wedding (again, it was wonderful!), but I noticed that the venues were sparsely decorated. I noticed because I spend way too much time thinking about finances! And also because my wife’s part-time job is wedding planning… so there!

But I think my friend and his wife did it intentionally. I’m sure they were very frugal and made very smart financial decisions. Which is an excellent sign for them and for their future together!

Which Brings Me to My Point

According to CNN Money, the cost of weddings average $30,000 (for 2013). To be fair, they include engagement rings in that number. Take that out, and you’re looking at an average cost of $24,000 for the “day of” celebration.

My own wedding was in 2009, and we spent just under $20,000. But we were young and stupid and terrible with our money back then!

I didn’t ask my friend how much they spent on their wedding, but I don’t think it was anywhere near the average. Which is great for them. Because they had a great ceremony and put on a great party!

So, you can be frugal and still have a beautiful wedding. 🙂

Advertisements

Celebrate the Small Wins: I Have $100,000 in Retirement Savings!!!

I was flipping through the family’s financial accounts last week and made a wonderful discovery. Among my wife’s and my retirement savings accounts (my 401(k), my Roth IRA, and her Roth IRA), we have $100,000!!!

Woot, woot!

It’s just sitting there, waiting for us at retirement. It is a wonderful feeling indeed. (I hope that I don’t have to, but…) If I worked until age 70 (I am 29 now), this $100,000 could turn into nearly $6M, if I never add anything else to it!

Wow!

Then, I started to think about when I could retire, I played around with how much I need to save per year, I tweaked the interest rates… and it left me in a daze. Depending on how I look at things, I could have anywhere from $2M up to $15. That is a HUGE spread!

Somehow, I turned a celebration into a depressing story. I reminded myself, “Self! You need to celebrate the small wins.”

(And also, “All that retirement stuff is Future Self’s problem!” Nah, just kidding.)

Why I Don’t Use Credit Cards

A few weeks back, a fellow personal finance blogger wrote that he earned an “easy” $1,000 last year from his credit card rewards. I posted in his comments section that I thought this was great! But I also made a comment that I don’t use credit cards.

Why not?

Well, my response in the comments was that I would prefer to trade the potential credit card rewards for simplicity in my financial life.

How Much in “Rewards” Am I Giving Up?

Let’s do some quick math. My average monthly expenses are roughly $5,000. Out of that, I would be able to charge about $2,250 onto credit cards. This equates to $27,000 per year that I would put on my figurative credit cards.

Let’s say that I could earn 2% cash back. That’s a whooping $540 in rewards for the year.

By not using credit cards, I’m not earning this $540.

Simplicity in My Financial Life

Instead of the $540, I am making my life a tiny bit simpler. Since I live on a budget, I am able to use my checkbook and debit card to pay for all of my expenses. Credit cards don’t even need to come into play at all.

I don’t have to carry around the extra cards, and I don’t have to remember to pay off the cards every month.

What Should You Do?

I don’t think that credit cards are necessary at all, and I recommend that you don’t use one. However, if you want to use them, keep these things in mind:

  1. The rewards really aren’t that great! Don’t let the rewards be the sole reason why you are using cards.
  2. Make sure you pay off your credit cards every month!
  3. You still need to operate on a budget.
  4. Credit cards should not be your “emergency fund” and should not be how you survive between paychecks.

If you like credit card rewards, then make sure that what you’re earning is worth the hassle. In my case, it’s not worth it.