How To Create A Budget That Works

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Budgets are the new wave in the financial world and if you haven’t already heard about them, let me give you a crash course. So a budget is a set plan that tells your every dollar where to go for each month. Many people run away from budgets or have loose designed planned budgets. I will instruct you on how to create one, that not only works but will grow into a monthly activity.

FIND YOUR CORE AMOUNT

The amount of money you spend each month on reoccurring bills that are necessary for you to live I call core amount. This includes, rent, water bill, car insurance, utilities, internet, car note, cell bill, etc. These are items you know wont change month to month and you can easily predict the amount. Once you add this number up, keep in mind this is the amount you must absolutely make every month to live. Obviously, utilities and water may change but if you can’t live without it included it in this total.

ADD SURPRISES

This is when budgeting gets tricky if you don’t account for this space. Now obviously you can’t predict when your car will break down. However you can predict small things like, Mothers day gifts, baby needs new car seat, car needs oil change. When you sit down to budget look at whats happening in that month and try to put a set amount on what your going to spend. So its may 9th, me and my husband budgeted my mothers day gift and my mom spending the week with us. So therefor he doesn’t go crazy at the mall, and it allows us to figure out how many restaurants we can all go to when she flies in. Just remember budgeting is putting a name on every dollar you own!

INCOME

Once you finish getting your core amount and adding in all the surprises of the next month, you must come to income. Now for some people this is easy if you are salary. Salary people just write down how much you will bring in this month and your done. My hourly people you will need to write down the average you bring home. So if you typically bring in $1900 a month and one month you bring in $2200, just remember to save the extra for the months you don’t quite make the $1900 monthly income.

MATH

Last step,(my favorite part), do the math. Take your core income and your surprised expenses add them up now minus them against your monthly income. You should have some money left over. Thats because you haven’t taken into account your grocery,gas, and walking around cash! The amount you have leftover will help you decided the type of groceries you can buy, the restaurants you can go to, and the amount of nail/hair appointments you can make. This is what makes my way of budgeting easier and more efficient. When you see you only have $300 dollars leftover to spend on food and gas you SHOULD be willing to cut out restaurants and miscellaneous because the math doesn’t fit your budget. This way allows you to focus on the bills that make sense(rent, water,etc). When you get to the math part of budgeting and see all the things that don’t make your budget you will need to start making executive decisions, I call them budget cuts!! With this leftover money put how much you can spend on things like food and gas. I typically spend 200-220 on food, and gas is 100 for my family. If we only have $300 leftover for the month, I start looking at what can I cut. Do I need to lower my mothers day gift budget, maybe Jamal can get an edge up vs a haircut. When you know you don’t have a lot of money leftover you will start to change the way you spend.

Let me be super honest here, budgeting gets very difficult, it will takes months before you actually hit it on the target. Life comes with so many loops and turns its hard to direct money, but with chaos comes order you need both. This is what makes budgeting so important. You will set out a budget of where you want your money to go and of course your car will break down that month, or some random expense will pop up that will re-allocate your money elsewhere. Be ready and be prepared it takes time to get it right and some months you may not hit the mark. It took me about 5 months to finally hit the dot. I would get close and my son would run out of diapers, or my husbands car needed an oil change and I forgot to budget that expense. So start this journey knowing it will be a long trip and some months will get difficult. Don’t give up, keep pushing the journey will be fun and worth it in the end!

When Saving Gets Hard

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Of course you know you need to save and you know the benefits of having an emergency fund but at times it seems impossible. For once I can finally understand this feeling. I told my husband man I remember those days when if I liked something at a store I just bought it. With baby here and living on one income, this whole buy now attitude had to change and it wasn’t an easy one. Yes, even for me Mrs. super saver. See no matter if your a fashionista, or into video games there is always something out there that can grab your eye and your money! Check out my cool funky ways to calm the lion, and save the ducks.

 

SAVE YOUR GOAL IMAGE

Whatever it is your saving for screenshot it. We really want to buy a house, so today I put the image as my background to remind me every-time why I have to save. Small reminders like this make it easy to put the 85% off shoes back! Whether its a car a house or just a set amount find the image and save it everywhere.

 

STAY INFORMED

I am a huge supported of podcast and Netflix documentaries. Try to spend time doing things that don’t cost money and keep you knowledgeable. Since I am a first time home buyer I watch many docs, and listen to podcast on home buying. This keeps me engaged in my goal and educated. I also know eventually my car will retire and I will need a new one, I sometimes watch youtube video on best “SUVS IN THE MARKET” and why.

 

MAKE IT FUN

While money can be boring to most people find a way to spice it up. Challenge your love ones or your friend. See who can save the most, talk about dreams of you in your goal. Keep it fun, and fresh!

 

NAME IT AND CLAIM IT

For or down payment we decided to open a separate account away from normal savings. We named it houseaccount. So anytime we move money over it states transfer to house account. Not only does it help keep track at where we are, I am more motivated to add money to that bank!

 

Enjoy this time, because months/years from now you will be laughing at how you ate rice and beans for dinner, or how you drove a clunker car for years just to buy a new car in cash. Sometimes we spend to much time looking at others peoples life, items and ads too realize the beauty in what we already have!!

 

Why Passive Income Matters

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So your killing it in the side hustle expertise and now, you hear about this new thing called “passive income”. So, passive income is money you receive for not actually being involved, examples would be like rental property or dividends from stocks, we will dive into more ways to dig into passive income later. Lets focus on the fact that you are working on your side job and your making profit, paying off debt and feeling good. But why not keep pushing that envelope. You can usually pull from your side hustle a way to bring in passive income. So I am a graphic designer and my main business maybe freelance work, but I can also set up a etsy print shop and sell printable. This allows people to shop my work, and print the art from their home. I wake up every morning to money in the account without having to lift a finger.

 

 

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IMPORTANCE

The reason I push for entrepreneurs to have a stream of passive income is because you only have so many hours in a day.  Even if you work all 24 hours, that is your cap. You can raise your hourly rate but at some point you will hit a wall and want to bring in more money. Passive allows you to still remain focus on your other jobs but can bring in money with little to no work once you set it up.

 

 

 

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SICK/EMERGENCY

As I write this post its -6 degrees and it seems like everyone is coming down with the flu. If I was a photographer I probably wouldnt have to many gigs with the weather being cold, or I maybe sick and cannot perform a job. The passive income will come no matter if your sick or if an emergency comes up. However if your a healthy human and you usually stay away from being sick. What about your child, or your family member? If they need you right away there is no PTO days in the freelance world. But in passive income there is always a paycheck!

 

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STREAMS

You have heard it from every business book in the world. Make sure to have 7 streams of income, although I haven’t quite got to 7, having multiple amounts is definitely a benefit. America is a fast growing capitalist world, some trends come and go and others last forever. While your podcast might be killing it your blog may dwindle but that’s okay, streams change. As long as there is a stream your doing great.

 

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INTERNET

Living in the internet boom, we can all contribute something. There is blogging, youtube, advertising, affiliate sponsoring, printable, the list is endless. And while you may think you don’t have a talent that can consist of passive income think again. That might be your fresh idea. Sit down and think of ways you can increase your wealth and create some passive money for your bank account.

 

If anything hopefully this post gets you thinking more about passive income. Sometime starting small ideas lead to bread-winning ideas. I started selling t-shirts, then decided on selling a few prints. Months later the prints where out selling my t shirts. Small ideas are great starting points, get to thinking and put your thoughts to actions.

How To Save Money By Shopping At TJMAX

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So you may think of this store for clothes, a few home decor and baby items. But tjmax doesn’t stop their they have everything and they have it for the right price. I live in walking distance to a tjx and I have notice a few items to be intensely cheaper than your average walmart/target price. I also notice that you can find items like, toothpaste, deodearant, body wash, laundry detergent, and dish-washing soap. I mean the list is endless and plus all the items are name brand or eco friendly.

WHAT THIS MEANS FOR YOU

If you don’t like the idea of buying off brand at stores I would opt to shop at discount store like tjx, ross, marshalls for items like I listed. This way you can keep your favorite brands in your home but pay half the price.

HOW TJ-MAX GETS ITS ITEMS

So, you might be wondering how can a store have items like these at prices this low. Well what happens is, dove may make 1,000 spray deodorants, but only sell 500. Tjmax will then swoop in and ask to buy all there un-sold items at a discounted rate. Then take the item and sell it at its store for a profit.

Candle Selection

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I use too always buy candles from bath and body works, however I got tired of constantly waiting on the 2 for $22 sale, or stocking up when items were cheaper. My husband surprised me with a candle from tjx and I never looked back. You can get a 3 wick candle soy that burns forever for $7.99. With no need of coupons or watching your email for deals this makes the better buy.

BABY PRODUCTS

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If you have a child please buy all your products here, they are so cheap. I have bought my sons detergent here, his dish soap for his bottle cleanings, I have even bought diapers. Most of the time honest will discontinue a design or a product size and sell it tjmax. We have the laundry detergent that is 128 oz it has lasted his first year and no one sell that size anymore. So if you see a product you like for the right price I would stock up. They may not have the same item next week.

SKIP THE CLOTHES

Just like target try to go in for only the items you need. I love this store so I can easily lose it. I try to only shop the home and body section and leave the clothing alone. With my son I may check out his section but they have toys and bibs and small items that I can normally keep myself from spending extra money.

CONCLUSION

I really think if you have a Tj-Max, Marshalls, or Ross near you, try checking it out. It might not work for you but it also might save you a lot of money depending on the products you buy and what your store may carry!

This post is not sponsored or endorsed by tjmax, these are my opinions.

What “NOT” to do with your refund check

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So here I am thinking of many ways to tell people to maxamize there refund check, and it hit me let me first cover what not to do with your extra money. Now I had to do some research and what does the common person do with there money and how much does the average american save. Now there is no black and white anwser, however I have asked a few people, seen many post on my fb timeline, and have a good estimation where this money goes. Lets dig into where you shouldn’t spend that extra cash.

 

CAR

So, funny story I went to a rather diverse school when it came to income amounts. While my friends were not rich I always knew when there mama got there refund check. Either my friend or my friends mom would be rolling in a new vehicle. Now is buying a new car wrong. No, but if you didn’t have a need for new wheels then why are you wasting money on it. Was 2017 so dreadful that getting a new car in 2018 will change things. Okay I drive a 2005 Nissian sentra 188k miles one of my rims is missing I have a massive crack in the window My engine light is on as much as my heat is. Now does it still drive yes, so as for 2018 I will still be pushing my rough looking baby around! I understand that you may crave a new whip or see a great deal on a new car. However saving money should be priority number 1. Wouldn’t it be nice if you could go without a car note? I still drive my car because It allows my family to live on 1 income and sets us up financially better for the future. We could not be a family of 3 living on 1 income with 2 car payments. So keep rolling what you got and move that money to the bank!

 

RENT

I have heard the theory of paying up a few months on rent. Now if you have 0 self control and you could see yourself buying gucci bags rather than paying your rent. Then go ahead but if not and you have better self control (I pray you have self control). Don’t pay up on something that isn’t debt. Paying next months rent does nothing when you already have the money. Now if this was a mortgage then yes, a car note yes. But a lease NO! Try to save the money and in the future if you cant make rent you will have it saved. This is a poor mindset, you are in the state of thinking of today. I have money today so I need to spend what I have. I read lots of articles on how the poor think differently from the rich. Living for today and spending all you have for the moment you receive it, is number 1 mentality of the poor.

 

VACATION

Don’t we all need a vaca. I know I am up for one at any moment. However if my goal is to get out of debt or buy a house right now isn’t the time for one. Wait to you achieve your goals before you spend time “celebrating”. Before I had my son me and my husband wanted to travel but we knew I would be on leave for 3 months and not receiving a full check. We ended up staying at the house, thank goodness because I quit my job a week before giving birth.

 

NO PLANS

If you know that you are receiving a tax refund and you have 0 idea on where your going to spend it then you got a problem. No plan usually ends in a disator. Try to look at your finances and see where the money would go best. If its savings or debt. Opt to have at least 1,000 saved before you start paying down debt. This is just a safety net just in case things go bad. I try to tell people to have 3-6 months of living expenses saved. If you don’t have an emergency fund or 3-6 months saved, put your refund to either one of the causes.

 

RESEARCH SAYS:

After spending time looking into what people actually do I am suprised. However they said it depends on the economy. Just remember your refund check is money you already put in the system unless you have kids or are receiving the Income tax credit. Make a plan and execute! When me and my husband got married we worked ALOT! I had 2 jobs and so did he. Our first year we received a small amount mostly due to the fact he was still in school working fast food. We took the money and threw half in savings the rest went to his student loans. But once we started working full time jobs with higher pay, that next tax season we owed the IRS. This is a testament to how life works sometimes your up and sometimes your down. But if your savings always stays afloat you can maneuver through life no matter the valley! So take that extra check and let it work for you, save it or get out of debt!

How To Eat For 2 on $200 A Month

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I did some research on how much the average american spends on food and the USDA states, those with incomes of $75,000 or more per year are averaging $180 per week, compared with $144 for those with incomes of $30,000 to $74,999, and $127 for the lowest income group. I almost fell out of my bed when I read this. What could Americans be possibly buying. I have found lots of way to slice this amount to $100 per person. Please understand as I do live in the midwest (oklahoma) and prices may differ(according to USDA the midwest is $60 cheaper a month compared to the east and south), but the actions I take are more on principle than on price. Now some of you will say I like my name brand I love whole foods, and what not. I understand, in my

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dreams I go grocery shopping at whole foods I don’t look a price, I buy new spices every week. If your looking to do this on a budget then you will be highly disappointed. The point of saving and building wealth is to get to those goals but first by sacrificing; so let’s dig in and see what steps you can take to lower your bill.

 

1.Leftovers

No more leftover dinners for lunch the next day. Have you notice when you go out to eat the lunch menu is cheaper. When you eat what you cooked for dinner for lunch you have just had a really pricey lunch. Opt for what I call a no meat lunch. You will be surprised by how much cheaper it is to not buy meat and how healthy it is for your diet. Below Is what I cooked my husband for a week (recipe).

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My husband loves his meatless lunches and he still has all the energy he needs if not more. Now I am breastfeeding and my pediatrician wants me to keep my weight up so I eat hot dogs, chicken salad, or chicken with mac and cheese.

 

 

2. Plan your meals by sales

I don’t get ads but I have this app (here) that shows me all the sales going on in my area and at my favorite stores. I love trying new things and with making a meal list catered to sales I can not only save money but my family gets new, and different foods all the time. Are mango’s on sale, then google meals with mangos and maybe make a mango salsa, “you get the point.”

 

3.Go in with a plan

Are you walking into the store without a list, did the list you make start out with meals first. So yes I will admit meal planning takes forever. But it will save you time during the week when you need ideas on what to cook. So first start out by writing down the meals you want to cook then all the ingredients needed to make those meals. Scratch off what you have then create a list of the things you need to get from the store. This tip is the most important as we are going to these stores with no plan, no strategy. Grocery shopping is a serious things you have to look at it as such. Plus when you make a meal list it gets the whole family involved. Here is the meal board I have in my kitchen (here), My husband loves knowing whats on the menu. Normally he will be like oh drea Thursday night can we have wings it’s a big football game on. Or hey I really like this meal lets put it on the schedule. Get the whole family involve mark certain days as daddy cook days.

HOT TIPS

No juice– We don’t need soda or juice to survive so don’t waste money purchasing it. Not feeling this, then buy yourself the packets of tea and make your own juice. Its cheaper and you can control how much sugar you put in each batch.

No water bottles– Buy a brita filter and just filter the tap water you already have. My husband loves bottle water so I allow 1 case of 24 from aldi only $2.19 and it has to last the whole month.

Frozen Meals/Pizza– I usually have a few frozen pizzas or pre-cooked meals in the freezer. At aldi they run from $3-$4.00. These are my cheat days for when I dont feel like cooking and it keeps us from going out to eat. Pair the pizza with a salad and your good to go. Also after I spend all day at the store carrying a 10 month old while putting 2 weeks of food in the cart I am way to tired to cook that. Grocery day is usually pre cooked meal day!!!

Homemade– I don’t buy ragu or pre-made pasta I make my own, that also goes for Alfredo sauce, and when I am feeling fancy I make my own salsa.

Less Is More– As American’s we already have over-sized proportions, try increase vegetables and decreasing the main dish.

Pantry– You must I mean must have a pantry, I have mine stocked with pasta, rice and black beans. Build one on the needs of your family and you will always have food.

No Name Brand– opt for the off brand, unless it makes your skin react or you physically cannot have it, buy it. My kitchen is full of the aldi brand and sprouts brands and my meals still taste great.

Slice Chicken In half– I buy chicken breast when they go on sale for $1.99 or less a pound at sprouts. I then slice them in half. They are usually super big and thick so 1 can easily fill up a grown man and breastfeeding woman on 1 chicken breast.

 

Meals & Prices for the month

Here is what we had for breakfast, Lunch and dinner. I linked a few recipes that I tried and were cost efficient.

Breakfast Meals- Waffle, Scrambled/Boiled Eggs, hash browns, Yogurt with granola, Cereal, Malt-o-meal, Oats with fruit.

Lunch Meals- Chili dogs, Quinoa and sweet potato mix, Homemade pizza rolls, Chicken salad, quinoa and sausage with bell peppers.

Dinner Meals- Chicken spaghetti, tacos with corn, beef spaghetti with Brussels sprouts, baked drumsticks, Crogrilled-bruschetta-chicken-101.jpgck-pot barbecue sauce drumsticks, skillet chicken with brown rice and veggies. Chicken tortilla Soup, Chicken with fresh cooked asparagus, Baked chicken with brown rice and veggies, Frozen pizza (3), Chicken pesto with mash potatoes and veggies. Hamburgers with homemade fries, Quesadillas with black beans,

Snacks- Chips and salsa, Chips and queso, Ice cream, Cookie mix

 

As you can see, we eat alot of chicken, I try to only have 1-2 meals with ground beef (its not healthy to eat red meat all the time). Seafood only gets on the list when its on sale at $6.99 a pound (I get only 1 pound). I dont get crazy with coupons unless I go to target. As for this month we only went to sprouts and aldi. Jeremiahs food runs around $40 a month. I puree and cook all his solids its cheaper and I know exactly whats in his food. Plus I can make combinations that Gerber may not sell.

 

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CONCLUSION

It will take some time to get to $100 a person a month but its worth the savings. Focus on meal planning and whats on sale for the week then go from there. Take baby steps and try cutting $50 off a month until you get to your destination! Comment below on how you save on food a month or how you are trying some of the hot tips from the blog post!

 

 

 

7 Tricks to save on utilities

 

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So its almost the end of October and if you live in a normal state where fall means sweaters and booties and all the cute clothes then you should be seeing a savings in your utility bill. But if you live in the Midwest like me, then you may still be running your air. Here are a few tips me and my family have taken to save money and cut our bill down.

 

 

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  1. KNOW YOUR LIMIT

So, yes you could totally turn off your a/c or heat and tough it out. But that’s not for everyone. My friends electric bill is no more than $30 a month no matter the season. However when I go over her place I am either sweating it up or freezing. So of course your home should be comfortable but know your limit. We use to have a cheaper bill until our son was born. He doesn’t sleep at night if it isn’t at least 72 degrees. I will rather pay the extra than have to deal with a crying baby.

 

 

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2.LEARN ABOUT YOUR ELECTRIC

Once you know the desire you want your home to feel, call you utility company and ask them if they have smart hours, or is there a certain time that your electric could be cheaper. When we moved, the new place didn’t have a smart hour system but when I called they said that my electric is the highest between 2pm-7pm. But on weekends its a flat rate and the cheapest. So what this means is from 2-7 I do my best to either run the fans and turn the a/c off (besides nap time lol) and wash clothes on weekends or early in the morning.

 

 

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3.UNPLUG, UNPLUG

Stop wasting money on electronics plugged in. I try to make sure at night I go through the house and unplug all my electronics. With my computer I have it on smart save mode  where it shuts down every night at midnight and reboots at 8 am.

 

 

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4.SHORTER SHOWERS

Are you letting the bathroom get steamy before you step in, do you take showers longer than 7 min, are you wasting time picking out your outfit while the water is running? If yes, then stop and save the water. Its eco-friendly and money savings.

 

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5. FALL IN LOVE WITH YOUR CROCKPOT

Running your oven is so expensive especially in the summer. Opt to use the crock-pot and or microwave its cheaper.

 

 

 

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6.REPLACE AIR FILTER & LIGHT BULBS

The dirtier the air filter the harder your a/c or heat have to work to circulate your air.Also switch all your light bulbs to the energy efficient bulbs. These can be found anywhere and will pay themselves back and more once you make the move.

 

 

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7.WASHING

Try washing your clothes in cold water, this will not only save you money, it wont shrink your clothes as well. Are you cleaning your lint trap after every load, the method behind the air filters is the same in the dry. When you keep that clean its easier for the heat to dry the clothes faster.

 

Every state and location is different. I learned this after living in a 500 sq foot apartment that was old and moved to a 1200 sq foot townhouse that was brand new. The townhouse electric and water bill was cheaper. All due to the fact it had energy saving appliances and was sealed off better. This is something to think about when buying a house and deciding on a place to stay. Newer usually means saving on utility bills. Find small ways to save water and electric, it will not only save you money but it will help the environment.

 

How To Save With A Baby

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While I may only be 6 months in and haven’t been a mom for too long I can still tell you great ways to save with a child. The latest report estimates having a child will cost roughly 233,610 from birth to graduating high school. Which may scare you, however I have a few tips that can lower that cost and set your family up for wealth building. Plus having a child is more than about money, its about the memories and the joy of bringing life into this world.

 

GENDER NEUTRAL

First, you must think about how many kids do you plan on having. If you have one now and are open to having more kids later on, remember to buy gender neutral items. For example I got a crib that is white with a brown base. When I registered for a crib I wanted to make sure It would not only stand the time but also if we were to be blessed with a baby girl I wouldn’t have to go buy a new crib. The stroller, car seat, bassinet, diaper bag. Are all either black or grey. The only thing that screams boy is his clothes, the rest is up in the air and on lock for the next baby.

 

BRESTFEED (if possible)

I will be completely honest, most women are like I breastfeed because of all the health benefits and it so much better than formula. Ummm….. well ya that’s great and all but I initially breastfeed because I knew it was free milk, all the other additives were just bonus. The fact that my son is 6 months and we have never had to spend a dollar on the expensive formula helps out so much in his first year. Not to add, with breast-milk his immune system is stronger so less trips to the doctor in the future and no ear infections. If your child has issues with latching on, or your don’t like the idea. Try to pump, you may not be able to make enough milk for all his bottles but it will cut down the amount of formula you have to buy. Plus you can mix breast-milk and formula.

 

HAVE A BABY SHOWER

We got 90% of all Jeremiahs baby stuff at our baby shower. We were blessed enough to have 2 plus, my job gave me a gift card and a mamroo swing. Especially if its your first child people are very open to buying you lots of gifts, that’s why its so important to go ahead and get gender neutral items just in case your family isn’t too generous on baby #2. Also jamals football team that he coaches got us enough diapers and wipes to get him through the first year. Which brings me to my next point.

 

DIAPERS

While you can get away with free milk by breastfeeding, diapers is another story. Many women have opt to do cloth diapers. While I am not against it, its not for everyone. If you are dedicated and passionate about doing cloth diapers then go for it. If not, you must be on the look out for deals 24/7. Try to stock on sales but always remember to keep your receipt. My son was in size 1 diapers for maybe 2 months before we had to move him up. This left us so many unused diapers in his stock pile, luckily the people who gave us the diapers had gift receipts with it so we were able to exchange it. Check places like Tjmax and Marshalls they carry bulk sizes of honest diapers for cheap cheap! CVS, and Walgreens have the best deals as well, make sure you always check them out.

 

FREE SAMPLES

Just google free sample for baby items and a list of great sites will pop up with many good items. Jeremiah has over 4 bottles formula toys, soap, anything you can think of he got from a free sample. And I am talking about the free, free stuff, where you don’t even have to pay for shipping. Places like target, and Walmart will try to get you to register at there store in return they will ship you a sample of items. We registered at both even though we didn’t technically use Walmart we made a list added 2 items and had free bottles ship to us. If you have amazon prime, create a baby registry and they will ship you a box of samples. This box was amazing full size wipes, toys and alot of great goodies. Just remember your email will get slammed with ads from baby companies so you might want to use an email that is just for this.

 

LIBRARY

This is a great resource if you are a stay at home mom, or you work hours that allow you to be off in the morning. We go to our local library every Tuesday for babytime and my son loves it. They read to him let him play with toys plus he gets to meet new babies and I get talk to new moms.

 

MAKE YOUR OWN FOOD

So my child isn’t on solids until the end of this month but we are already prepared for food. We are going to puree all his fruits and veggies. There are tons of information on pinterest and youtube on how to do this. Its not hard just a little more time consuming but not only will you save money but you will also feed your kids food without all the preservatives and chemicals in jar food.

 

Remember that kids don’t have to have the latest and greatest, at this age they don’t even know the difference between an expensive toy and a plain box. Get creative and stick to a budget, your child will be more grateful of an interactive parent then some lavish toy.

 

Paying Down Debt VS Savings

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If you are young you probably have some form of debt. I believe one of the hardest thing about finances is deciding where to start and what to focus on. Sometimes you can be so far behind you feel hopeless. Although you may have no savings and a lot of debt there is an answer.

So if you don’t already know I graduated debt free and I was blessed to have a car given to me in high school with no car note. So yes I have no debt but my husband has a car and student loans, so we have been faced with dilemma do we pay the debt down or save money? The short term answer is pay debt, all the big financial advisers will tell you debt first. But I believe its much harder than that. Depending on your narrative will ultimately choose which path to take first. Look at all the elements I raise for you to ask and this will be a guide to let you know where to start.

 

GOALS

What are your short term and long term goals. Me and my husband want to have a house and we want it rather soon. After talking to a loan officer for a pre-approval letter, he wasn’t pushed back by the amount of loans we had. He was mostly focus on our credit and how much we made. When we told him how much we were going to put on the down payment and he ran our credit and was like ya “your good”. And in seconds we were on our way. Small hiccup it was contingent I went back to work making similar to my old salary, (but that’s another story). This goal we had showed us that we should be focused on the down payment, rather than paying loans. So if a goal of yours requires money right now then go for the savings.

 

INTEREST RATE

This one is rather simple, a good savings account can yield you 1.0% on your balance, an average credit card loan can be 15%. So if you have a huge balance on your credit card you should opt to pay that down first because it will net you more money in the end. You can also get savvy with the interest on things. My husband was able to put his loans in forbearance and have the government pay on the interest, and we put our money to the car loan which is at 4%. Its all about finding the most efficient way to make your money work for you.

 

KIDS

Do you have kids? If so save save save, those little suckers are so cute but can literally brake anything in your house, get sick, etc. You will defiantly need a small savings to make sure you can cover small emergency. Also if you go ahead and save 3 months of living expenditures and you lose your job you wont have to worry about putting everything on credit. When your single or married with no kids, your focus should be a “debt free” mindset.

 

BEING BLACK

Yes I said it, if you are black I would push for you to at least get 1-2 months of living expenses saved. Why? Well our income disparity is out of whack, last ones to get picked for a job and a whole bunch of other stuff that shows how racist this world is. I say all that to encourage you to make sure your money is okay. If your boss calls you the N word, and you have $0 saved with a child to feed your less likely to leave. If you find out your getting paid half the salary as someone without the education as you but you wont make rent if you leave then you will compromise. As someone once said “black people always make sure you have some F-U money. “

 

TRY BOTH

This can take some practice and I will admit its A LOT of work. But if your up for the challenge do it. Make a goal you want to have save and how much debt you want to pay, then rotate each amount every month. So lets say you have $300 each month to either save or put towards debt. One month delegate it to savings the other month double up on your car note or student loan. This way you will have a little money saved but feel like your one step closer to being debt free.

 

Confused? If so, its okay which ever option you choose will be better than doing nothing. The difference is buying an item on sale and being happy about it, too find out next week its 10% cheaper. You might be mad that you didn’t get it at it lowest, however you didn’t buy it full price. Looking back on your financial decision you will be glad you started either path even if your like darn I should of paid the car off first. You live you learn and that’s the beauty of life!

Are you still wasting money on a car note?

 

car note

Now I am no expert on cars and by all means I am not a mechanic. However I do know that america is trading in there cars way to fast. The average time an american has a car is 6 years, although all modern cars can last 11 years (consumer report). So why are we only getting half the life out of our cars? I believe it has something to do with pressure of America telling you, you need better, faster, newer, and you need it now.

 

CAR PAYMENTS

It should not be the norm to always have a car payment. We must break the idea that we have to have a car payment all our lives. This is not true. The ultimate goal of buying a car is paying cash for the full amount so you don’t have to worry about interest and then keep the car for 11 years plus. According to Edmunds.com, the average monthly payment on a new vehicle is $479. Just think if after your 4 year note you were able to save that amount for 7 years, the duration of your cars life. That’s a savings of $40,236! You could use that money to buy another car in cash, or you could invest in buy a home. The possibilities are endless.

 

UP-KEEP

With anything, if you want to keep it awhile you have to treat it with respect. So if you want to be able to push your car the whole 11 years. You must keep up the oil changes and maintenance on the car. And I know you might think, well if I had a new car I wouldn’t have to worry about maintenance. This thought is true in you might not have a major issue but your paying 479 to not have one, vs paying 30 for an oil change or maybe $600 a year in car fixes.

 

NEW VS OLD

This is a big one that many argue over. So here is my synopsis, buy new if you plan on keeping that car for 11 years. Therefor you have all the warranty and 0 miles on the car. Me and my husband bought our Honda new, but we plan on having it until the wheels fall off. If you find a good deal on a used car then go for it. I don’t know much about cars so me finding a good deal and knowing if the engine and transmission is okay, are slim. So I leave the bargain hunting for someone else.  We all understand the concept that a car loses value when it leaves the lot, but that’s only if you decide on trading it in for something else soon.

 

180,000

I am not saying all this and rolling in a brand new car stunnin’. My car has 186k miles on it and I am still pushing it. I do have a child and we do have a 2015 Honda that we use as the family car and my husband drives my car to work. He works 30 min away and my car does just fine it may not have the sun roof or the really good air, but it does give us the freedom not to have a car payment every month. We are praying we can put 250k on it, so the Honda can be paid for and we wont have to worry about 2 car payments at one time. But if my car does give out you better believe we will go to a 1 car system and do what we can until we have the means.

 

Save now, so you can ball later. If you keep pushing your Nissan, Honda or Toyato. You will be able to either buy your next car right out or get a luxury car. I want a Acura RDX but I know to have that car I must be patient and wait. Remember everything comes in good timing just wait and push your car until it says its time for a new one.