Cutting Back - Part Two (aka. my ode to Mint.com)

You know, it's pretty amazing what you can do when you put your mind to it, and I have to admit I'm even surprised that we've been able to live so well on so little since adjusting our budgets. Below are a few things we've done to change our spending habits - both large and small.

1. Savings Goals: When you're paying down debts like our student loans, your savings accounts are going to suffer a bit. However, once you get rid of those payments you'll be able to direct all of those funds back into your savings accounts and build those nest-eggs. We've continued our 10% into retirement (which is typically viewed as a bare minimum), but have pared back our other savings accounts to the basics (see next point...).

2. Continue saving for big fixed expenses: Put away a little each month for property taxes, home insurance, life insurance, car insurance, holiday gifts, home maintenance, car maintenance, etc. so that you're prepared when those large expenses hit.

3. Keep your savings goals - just adjust them: Have a slush fund account? An emergency fund (you should! At least enough to cover your fixed expenses for three to six months)? A 529? Don't stop funding these accounts entirely - just figure out what you can afford to put into them right now. $25 or $50 a month? Even just a little bit will make you feel like you're still making progress towards these goals.

4. Reduce your fixed expenses: You'd be surprised how much you can save when you make a few phone calls and decide to change your lifestyle in small ways. For instance, we've made the following changes -

• We don't have cable. My husband put an antenna on the roof of the house for $25 a few years ago and that's all the TV we get. We've gotten to enjoy not having the TV on all the time. Yes, we do get Netflix, but if we needed to we would give that up and just get movies out of the library.
• Call your car/home insurance companies and see how much you can cut back. I did so recently and cut nearly $300 off of our annual car insurance costs.
• Line dry your clothes. Really. I cut nearly $30 off our power bill each month by not using the dryer.
• Clip coupons. Not for everything, but for those items that you're going to need to buy anyway.
• Cut your own hair. Or, at least, your husband's hair. Thank goodness I have a husband who's willing to let me experiment on his tresses (and who has one of the easiest haircuts ever)...and that saves us $15 a month.
• This is one of those times in your life when you may have more time than money. For example, learn how to sew to save money on alterations. I hem my husband's pants and that saves us $20 a pop.

5. Make a budget and track what you spend (and save!). With websites like Mint.com it's easier than ever - and, better yet, free! You're not going to know how much you're paying each month for, say, groceries, until you start tracking it - and I dare say you'll be surprised. On the flip side, you'll be able to watch your savings accounts grow (even though it might be slowly!) and it will feel good to get closer to those goals.

6. Food. Ah yes, despite my penchant for cutting back I'm not about to give up our passion for good eats. I'm not going to mention the basics about forgoing your lattes (that's pretty obvious), but here are some tips for eating well on a budget.

• What is a reasonable food budget? I could find just about nothing out there on specific numbers but for reference, we're spending about $300 a month, or $75 a week, to feed the three of us.
• Meal planning. Seriously, this was a life changer for me. It was like suddenly everything came into focus when I realized that, with a little pre-planning, I could use our leftovers with purpose. For example, grilling a chicken on Sunday? Make chicken tacos on Monday, chicken salad on Tuesday, and use the final bits for a pizza on Wednesday. Use the chilis in Adobo sauce you bought for your tacos on Monday to add a little heat to your pizza sauce on Wednesday. Oh, and use that cilantro for the tacos on Monday to season your salad on Tuesday. Yep, it's fantastic and yes, I have a type A personality.
• Dried beans. Learn to love them and learn to soak/cook them. In fact, learn to love everything in the bulk department at your grocer.
• You can still do organic/Whole Foods. We shop at Whole Foods and Trader Joe's every week and manage to keep our weekly food bills less than $75. It can be done. See meal planning above.
• Freeze. Buy things on sale (like chicken breasts) and freeze the extras. Make stock and freeze in batches. Make pesto and freeze in ice cube trays. Make a list of what you freeze so that you know what's in there. And, most importantly, use it.
• Use meats sparingly. We are definitely not vegetarian (my husbands hunts), but at least half of our meals each week are meatless. The savings are seen not only in our food bill, but in our waistlines.
• Garden. I'm lucky to have a husband that loves working with his hands and treats our garden like his man-cave. When we make up our dinner plans for the week I 'shop' in the garden first.

7. When you waver, remember why you're doing this. When I feel the need to go to World Market and purchase new curtains or pillows for the living room, I remember that I've given that up for the time being so that I can spend more time with my son. Talk about putting things in perspective. And, if I'm dead set on some project I want to do around the house, I head to Goodwill or a consignment shop to find inspiration at a fraction of the price.

These are just a few things that we've done to cut our spending by thousands every month - yes, thousands. It can be done and, honestly, I've found it to be quite enjoyable. I feel more in control of our spending then I ever have and I know that we're using our finances in a way that allows us to live the life we want to lead.

Cutting Back - Part One

I've always been of frugal mind, but becoming a Mom brought my natural inclination to the next level.

Having a kid helps you clarify things. My husband and I have always been savers, but seeing our finances through the lens of new parenthood made things all the more clear. For instance, when along the line had we decided that, unlike debts like credit card and car payments (which we detest), it was OK to hold onto student loan debt? Yes, there is an interest deduction for tax purposes, but, ah hem, given my husband's out of state tuition at the University of California (yes, the degree was worth it honey!), let's just say we were paying a whole lot more in interest than we were able to claim on our taxes. While we've been paying down these loans above and beyond the minimum payments for years, when our son was born all of a sudden we saw these loans for the burden that they are - monthly financial responsibilities keeping us from living on one income.

I absolutely loved the four months I spent with my son during my maternity leave and while I was at home I massaged our financial data to the point where we could have made it on one income - barely. As in, 'savings go-out-the-wazoo-and-we're-living-paycheck-to-paycheck' barely. The stickler? Those darn student loans.

We went through the whole stay-at-home Mom vs. working-Mom thing and were lucky to find a solution that presents the best of both worlds. Let's just say that I'm extremely blessed to work for an employer that was willing to work with me to find a part-time role that allows me to spend more time with my son while giving us the extra padding that we need to live without stressing about overdrafts.

And, I should add, a solution that helps us pay down those pesky student loans.

How, exactly, are we making do? After all, when you include the cost of childcare, I'm making less than 25% of what I was making previous to my maternity leave. (Ouch - it still hurts.) Plus, in an effort to prove that we can do it on one paycheck, we are living off my husband's salary and nearly 100% of what I make above and beyond childcare is going to student loan payments so we can finally rid ourselves of those debts.

Continued in Part Two...

Real Food on a Budget - yes, even food from Whole Foods...

When I left work to go on maternity leave, we decided to cut back - way back - to see how it would be to live on one income. One of the budgets we slashed was our grocery budget, which we sliced by about a third to $300 a month, or $75 a week. At one point in my life $75 seemed like a lot of money. Now I know that $75 will buy you about one 8lb brisket at Whole Foods. Ouch.

Yes, we shop at Whole Foods and are not about to deprive ourselves by forgoing our addiction to good food. We've read too many books and watched too many movies (like Omnivore's Dilemma, Real Food, and Food, Inc., all of which I all highly recommend) about the state of the modern day food chain to go for the status quo when it comes to food - mainly in regards to CAFO meats and industrial produce. When we tell people we shop at Whole Foods I'm pretty sure they think that we're food snobs and spend a fortune...but that's definitely not the case (at least when it comes to the money part - as far as food snobs, well, call a spade a spade). It's all about planning out your purchases, limiting your protein and being able to say no to that delicious Gouda they are sampling at the cheese counter that is not on your list. But maybe next week it will be...

We now spend some time every Saturday morning planning our food for the week to make the most of our shopping trip and to make our food stretch as far as possible. A sample for this week -

Week of April 14

Sat - Salmon (from local fish monger) with wheat couscous and sautéed spinach from the garden
Sun - Lamb Steaks (from the freezer - a lamb we purchased at the local 4H auction) with mashed potatoes and salad
Mon - Asian chicken salad (minus the lo mein noddles to save some cash)
Tues - Chicken tostadas
Wed - Chicken Pasta (something thrown together with the final left over chicken and whatever we have left in the fridge, like cilantro, which we'd make into a pesto)
Thurs - Lentil Fritter Pitas
Fri - Freezer Meal (see what random Trader Joe's items are in the freezer, like fried rice or pot stickers)

As you'll notice, the key to many of these meals is chicken - we bought a chicken from Whole Foods and are grilling it up on Sunday night along with the lamb so that we can use the leftovers throughout the week. One of the main ways we cut back on spending was the fact that so many of the meals use similar ingredients, such as the chicken, or items that we already have at home left over from last week's meals like Greek yogurt or cilantro (we always take stock of what is in the fridge or freezer when getting inspiration for the week's meals). The grand total in spending for this week between Trader Joe's and Whole Foods was less than $60. Not too shabby!

Tomatomania!

We are always looking for fun, inexpensive things to do, and yesterday headed to Cornerstone in Sonoma for Tomatomania - an heirloom tomato sale with more than 100 varieties. It was our first time to Cornerstone, and we were surprised to find this little gem right off the road on 121! There are art shops, winery tasting rooms and a market for lunch, but the crown jewel is the gardens. There are at least 20 or more garden art installations by different artists, making it a great place to go just to walk around.

We of course did hit up the tomato sale, although since my husband Matt has started more than 20 tomato plants, we only bought one - a type called Carbon that he's read about in many blogs, magazines, etc. It's supposed to have great flavor and do well in our coastal climate - I guess we will see!

The afternoon was beautiful and it was our first 'outing' with our son Will (notwithstanding weekly grocery trips, which have become quite the adventure now that we have a little one). He slept for most of the time, but we did get in a nice stroll through the gardens with him in daddy's arms.

Besides our $4 tomato plant, the afternoon was free! You don't get much better than that.

The great cloth diaper experiment

I never knew I'd be so excited about baby poop, but today's cloth diapers are something to behold.

Little engineering masterpieces, these poo containment devices are proof that there must be a diaper god. Many sport features like 'all-in-one' functionality (meaning they operate pretty much like regular diapers, notwithstanding the whole washing thing) or sizing options that reconfigure one diaper to serve from birth to potty training. And by golly, they are pretty darn cute to boot.

Researching which diaper to choose is akin to researching your next car purchase - there are countless brands and each one fits differently, has different features like Velcro or snaps, etc. Like cars, you don't really know what your'e going to get until after you purchase it...because its not like you can take these puppies out for a test drive. Well, at least that is what I thought until I discovered Jillian's Drawers.

Jillian's Drawers is a cloth diaper retail store in Ithaca, NY that also has an online store. I discovered them through an article on the Parenting Magazine website that referenced Jillian's Drawers as having a cloth diaper trial program for $10. I was shocked - how in the world is that possible when some diapers retail for $25 each or more? Well, I'm pleased to say the program does exist and I've been so incredibly impressed! I'm not asking questions - I'm just enjoying the fact that I can give these things a go without forgoing a ton of cash.

After the trial, I have to admit I'm in love with cloth diapers. They've sold me - hook, line and sinker. They're just so stinking (no pun intended...sorry, couldn't resist) easy - literally throw them in the wet bag (we use FuzziBunz), chuck in the washing machine (we use Tide original powder) and wash. Then line dry (or dry in the dryer on the low heat setting). That's it. Seriously.

After much consideration/testing/budgeting, here is our diaper stash:

Bum Genius: 2 rotating diapers for nighttime use with extra hemp liners for absorption. They never leak.
FuzziBunz: 18 for daytime use
Tots Bots Easy-Fit: 8 for daycare. The Velcro makes them so easy to use - just like a disposable! My daycare originally wasn't open to cloth diapers but when they saw these, they were on board.

While we have yet to experience cloth with, shall we say 'solids,' I'm hopeful that I'll be able to make it through that shift in the bum department with my love of cloth in tact. Only time will tell....

August update: We've been using cloth for four months now, and I'm still just as excited about these diapers as I was at the very beginning! They are holding up great. By now, we are close to net zero in our outlay of cost for the cloth diapers vs. disposable. From here on out, it's just gravy. Not to mention that they're better for our son and the environment. Have I mentioned I'm in love with these diapers?