Saturday, September 15, 2012

Living Well On $25k Or Less: Financial Goals

It's hard to save money. It's even harder when your income is in the lower brackets. It can feel impossible to save up enough money for a new car, a house, retirement or a vacation when you barely have enough money to pay your bills on time. Unfortunately, delaying saving for the future until that distant day when you earn six figures might mean that you won't get there. The good news is that it is possible to not only save for, but meet your financial goals, even when your income level is low.

First, think about where you want to be. Daydream. What do you think will make you really, truly happy? What needs do you foresee? Here are some common goals:

* Buy a house.
* Get married.
* Have a child.
* Take a trip.
* Start a business.
* Replace a car.
* Remodel a room/whole house.
* Go back to school.
* Retire.

Next figure out a realistic time frame. How long do you think your car can last before it needs major, costly repairs? How long do you think you will be able to and enjoy working? 

Put a dollar amount to each goal. It doesn't have to be exact, but do try to be reasonable. Now, figure out how much you will need to save from each paycheck to meet that goal. Is that amount reasonable for your current budget? If not, can you push back the date or increase your income through a part time second job?

Make a reminder. If you want to buy a house, post pictures of houses you love around your apartment. If you want to take an extended hiking trip, post breath-taking scenes. If you're expecting a child, get those ultrasound photos up. Look at them often and allow yourself to daydream about when your goals will be met and how happy that will make you.

Open an interest earning account that charges no fees for small balances. You don't want to pay $3/month while you are trying to build up your balance. A savings account is great, but you could also purchase $25 savings bonds or open a CD that allows deposits. For the latter two, make sure that you won't need the money before the funds are available; these are best for moderate-term goals, 3-5yrs out. 

Make it automatic, if possible. I've found that it is much easier to save money if I don't see it. I save for retirement automatically through my employers 401k. Since it comes out of my paycheck, I never miss the money, but it sure adds up fast. Ask your bank about setting up an automatic transfer to your savings account. Otherwise, treat this savings goal as any other bill. Pay it before you start spending on entertainment or other non-essentials. 

Now I know that it is not easy to come up with big amounts of cash when you're making a smaller income. Saving a small amount regularly adds up very quickly, however, and it's relatively easy to do. Here are some ways that I have had success finding money to save:

* Clip coupons for groceries. Deposit the amount saved into savings.
* Redeem rewards points for cash back. My card nets me $20 about every month ($240/yr).
* Tax refunds.
* Birthday money. I only do this if the goal is really exciting for me (taking a vacation vs buying a new commuter car)
* Sell stuff that you don't want/need. Old books, movies, and collectibles can earn you a bit of savings money and you'll have more space.
* Whenever you get an extra paycheck in a calendar month, put at least half into savings.
* If your employer offers a match, take it (401k).
* Cut unnecessary services such as netflix, even if for just a short while.
* If you pay off your current car payment, continue to make payments, but into your savings account. Same with credit card bills.
* Fill out rebate forms and deposit the checks, however small.
* Figure out how much it costs in gas to commute to work. Bike or walk and deposit the savings.
* Live below your means. Buy cheaper clothes than you can afford. Rent a cheaper apartment (as long as it is safe enough). Drive your car a little longer before replacing. 
* When you get a raise, deposit that little extra bit each paycheck. If you don't plan to save it, you'll quickly adjust your spending to use it all.
* Buy goods (groceries, clothes, household items) on sale and deposit the savings.

It may not seem like it, but these tiny amounts add up. If you use $10 worth of coupons per week, that is $520 a year. If your car gets 20 mpg and you commute 4 miles each way by bike, you'll save 2 gallons of gas a week ($4/gallon currently) for a savings of $32 a month. Several tips can quickly add up to a sizable deposit and get you closer to something that means a lot to you. 

So how does this work in real life? Actually, pretty well.

Three years ago, Trucker and I decided that we wanted to buy a house. We wanted space, hardwood floors and a huge backyard for gardening. We spent this time stretching our dollars to the limit. We deposited money into our savings account as soon as I got paid, and learned to live on what was left. Sometimes we didn't go out to eat when we wanted to. We learned to enjoy cheaper or free entertainment. Any extra money we received was deposited into our savings account. Sometimes it was hard. Sometimes we felt like we'd never save enough for closing costs and down payment.

Yesterday we closed on our house. It is roomy, and has hardwood floors and a big backyard for me to plant veggies. We were able to reach our goal through hard work, even while our income was well below the $25k mark. 

Don't wait until you get a better job to start saving for your future. Start now to work towards the things that matter to you.

So let's hear your story. What savings goal have you met? What did you do to make it happen?

Saturday, September 1, 2012

Apple Processing Day

My mum has a couple apple trees on her property. At harvest each year, she gathers the clan together for apple processing day. We spend the day talking, listening to music, and usually order out a pizza from our favorite local pizza shop.

Just some of the harvest.
This year we got everyone together: mum and dad, my sisters and their beaus, my grandparents, Trucker and me. We spent six hours working, and produced enough that each family was able to fill their freezer with apple goods. We all pitched in whatever we had access to: apples, freezer bags, cinnamon, sugar or snacks for the workers. We spent around $5 for ingredients and another $5 for freezer bags by shopping sales. We each brought our own knives, cutting boards and a large pot to supplement Mum's kitchen.

Mum picked the apple trees before we arrived so we could get started immediately. She filled a wheelbarrow, 4 5-gallon buckets, 2 large coolers and three large boxes. 

Each family received two plastic grocery bags full of apples to eat out of hand. The rest were processed into slices for pie, applesauce, and apple juice. Next year, we hope to try out some new items such as apple jelly, dried apple rings, apple butter, fruit roll ups, and perhaps some hard cider! 

I filled up two sinks with water. One sink was filled with apples and we gently scrubbed them before moving them to the rinsing sink. We cut out any really nasty spots.

We peeled, cored and sliced most of the good apples for mum's famous apple pie. We packed the slices into gallon-sized freezer bags. These will save her a lot of money over the holidays as she bakes dozens of pies for parties, family gatherings and church/social functions.

Next came the applesauce making. All of the not-so-pretty apples (odd shaped, small, bug-bitten or fallen) were chopped into large pots. We weren't concerned about having white applesauce, but if we were, we could have added lemon juice to the water while slicing to prevent browning.

We added a small amount of water (about 1/4 c per pot) to help in steaming the apples before they released their juices. We added a lot of cinnamon to each pot. Since some of us have blood-sugar concerns, over half of the apple sauce was left unsweetened. To the remainder, we added about a 1/2 c of brown sugar to each pot. The apples cooked until fork-tender, and then I pureed them in the blender until smooth. By using the blender instead of just mashing the apples with a fork, I could leave the peels on without compromising the texture of the sauce. This saved a lot of time and had the added benefit of a higher fiber content.

Pots and bowls of applesauce were placed on cooling racks all over the kitchen. Once the sauce was cool, we ladled it into quart sized freezer bags. We marked each with the date and whether it was sweetened or unsweetened. The applesauce is great to eat as is, or warm with a scoop of vanilla ice cream (oh my!). We can also use it in baking cookies, muffins, breads and brownies. 
We also made some amazing apple juice. I hope to eventually get my hands on a cider press, but they are so pricey. For now, my dad and I both supplied our juicers. We juiced the cores and peels and ended up with several gallons of juice. This went into one-gallon freezer bags to drink warm during chilly winter evenings.

Any rotten apples as well as the pulp left over from juicing went into the compost bin. How wonderful to know that none of the apples grown went to waste!

I look forward to this day every year. It's a great way to spend time with my family. We also all get to have some amazing organic applesauce and juice almost for free. Not only that, but we are also learning about food preservation and increasing our self reliance.

Reposted on:

And an expanded version is published here: Five Ways to Preserve Apples

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13 Heritage Homesteaders Hop #3The Self Sufficient HomeAcre
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