Before the Christmas shopping season gets started in earnest on Black Friday next week, I just want to remind you all to spend responsibly. There’s no reason to go into debt at Christmastime. Your kids will still love you even if you can only afford to spend, say, $20 on toys instead of $200. So please don’t go out there and blow your mortgage payment, college fund, or home insurance premium on gifts that the recipient won’t even remember three months from now. It won’t be the end of the world if you don’t buy out Toys R Us for your kids. Trust me, they’ll survive!
I just got word that my mom was laid off today. I guess this shouldn’t be such a big shocker when the economy is as bad as it is. She worked in IT for a major insurer. They laid off more than a third of their IT group today — more than 300 out of 900 people.
As my mom is 60 (will be 61 in a few months), it’s not very likely that she’ll get another job in this field. As a result, she’s going to have to do some major budgeting overhauls to make sure her 401k and pension can stretch even farther than she expected they’d have to.
This layoff comes at a particularly bad time, though. She is in the middle of renovating her bathrooms and basement, and between paying for things like new ceramic tiles and Danze faucets, not to mention all the labor costs, she’s going to be shelling out a lot of money for the project. But it’s more than halfway done at this point, so it would hardly be feasible to back out now.
My mom’s bad fortune will also impact my own finances, as I’ll have to spring for plane tickets to go visit her, instead of having her come visit us as usual. So I better start pinching my pennies too!
That’s not to say that I’m rich now, but I don’t have financial problems like I used to. When I was in my mid-twenties, I was pretty bad off. I hadn’t yet graduated from college, was living in an efficiency apartment at the Westgate complex, and was working the night shift at a metals factory. I remember that I took home about $230 per week after taxes (I was making just $6.50/hr), and would spend almost my entire check over the weekend.
I had no money management skills at all, and just spent whatever I had on whatever I needed. If it was the week that rent happened to be due, I’d pay my share of the rent ($125) and have only $105 left to spend. If there was nothing due, I blew everything on cigarettes, beer, and blackjack.
Everything turned around when I got a better job and forced myself to follow a budget. I spent only what I had to, made sure I saved at least 10 percent every week, and cut up my credit cards until I got out of debt.
I know times are tight right now, so you’re probably tempted to charge more stuff on your cards, but I’m telling you: don’t do it! You’ll regret it in the end, and have a mountain of debt to show for it. There is a light at the end of the tunnel, but it requires discipline to get there!
Ok, I’ve been very good about sticking to a strict budget for the past four months, ever since my husband’s overtime got cut. I’ve retooled the cable bill so we have just a few basic channels, I’ve compared insurance quotes until my eyes glazed over in order to lower our premiums, and I’ve been clipping coupons like a madwoman. Moreover, I haven’t bought anything more expensive than a set of DVDs, and now I find that I’m developing a real urge to splurge! I’m talking spending money above and beyond what my tax refund will be — and not feeling guilty about it.
There are so many luxury items that I would absolutely love to get my grubby little hands on. A new Gucci wallet. A pair of Jimmy Choo’s. A Mont Blanc pen. A Caribbean cruise.
Oooh, I have a feeling I’m going to run up a huge credit card bill very soon!
I just got done with my taxes, and it turns out that I owe about $150 this year because I didn’t keep up with my estimated tax payments. This wasn’t a bit surprise, and the number is actually quite manageable — except that my first quarter estimated tax payment for 2009 is due on April 15 as well. So, I actually will end up paying about $400 instead of just the $150.
Because of that, I have to limit myself to window shopping for a while, which obviously stinks. It’s crazy how many things I end up falling in love with when I know that I absolutely cannot buy them. For instance, earlier today I saw some gorgeous area rugs that would look great in my living room, and an awesome pair of light cotton pants from the Gap that would be perfect for summer. But I had to just call upon my willpower and keep right on walking without whipping out my wallet.
I hate that I have to pay the IRS instead of being able to treat myself to a couple of nice things. Oh, well, at least taxes only come around once a year!
If there’s one thing I have great difficulty with, it’s living within my means. I admit that I like to show off a bit and flaunt some name brands every now and again. Sure, I might have jeans from Wal-Mart for daily use around the house, but when I get dressed up, I throw on a Dolce & Gabbana shirt, Cartier watch, and Prada loafers. I sometimes cringe at how much I’ve spent on this stuff and wonder why I even need it. After all, it’s not as though I have one of those Manhattan jobs that attract all the true fashionistas.
Anyway, this year I’m trying to make an effort to curb my spending on name brands. Why pay extra just for a label with someone else’s name on it, right? Actually, this task should be pretty easy because A) I don’t have any extra money for those types of products now; and B) I want to go to grad school, so I have to think about tuition and books instead of shoes and handbags. And that means I have to rework my family budget. What fun… not!
Now that I’ve got my 1099 forms from all but one of the places I did independent contract work for in 2008, I’m just about ready to settle down for an afternoon to do my taxes. I looked in my drawer where I keep relevant paperwork from the year, and boy do I wish I had a nice receipt printer to keep everything tidy. I could just scan my regular receipts into the computer and then print them out at the end of the year when I’m ready for taxes.
At any rate, I think I should be getting a slight return this year, as I paid far more in estimated taxes than I ended up owing. I also might be entitled to another stimulus check this year, but who can really say about that since the government keeps waffling about what’s going to be done about the economy.
Actually, since I made so little money last year, tax time should be relatively simple this time around. Not always a good thing, I guess!
As I wrote a couple days ago, I was thinking about buying my stepfather a watch for his birthday. When I floated the idea by Jerry, however, he immediately shot it down. He says we’re not really in a position where we can afford to buy luxury watches every time a birthday comes up. After all, he hasn’t been able to work overtime in four months, and his company is even thinking about scaling back to a 4-day work week in the near future.
Anyway, after thinking about what Jerry said and reviewing our bank accounts, I guess I’m inclined to agree. But that means I now need to come up with more affordable birthday gift ideas. I don’t want to go the boring route and buy cologne or a necktie, but I can’t really afford to spend too much money on the present, either. I’m thinking $100 max, so what do you recommend on that kind of budget?