I love Goodwill, picked up two shirts today for $1.98 total.  (I need to force myself to get rid of two old shirts I no longer wear).

I have a second baby starting on Monday, which is wonderful.  (I'll be making minimum wage again!)  This work from home thing has done wonders for my gas consumption. 

I've been reading up on S-corp formation...which is only thrifty in the sense that I made use of library resources instead of buying books.

My mom broke her foot and is stuck in bed due to swelling, so my dad and I have been picking up more of the household chores.  I'm proud of him.  But it does make me extra glad that I'm doing the work from home thing.
 

A lighter topic.  Apparently they've coined a new term for finding something fun to do in your home town instead of going away for a vacation.  (Thus saving on travel cost.)  Even if I had the money, I'm not in the mood to go traveling anytime soon.  I am pondering spending an absurd amount on a Wicked dinner package in September.  If I do it, it'll be my Staycation.

Of course there are some fun things you can do without ever leaving your house.  I had my "week off" this last week, and spent all my time at home playing video games, reading, hanging out with my best friend, and catching up on a few odd projects.

Funny thing is that there's a water park within long walking distance from my house, and I've never been there.  Are there untapped entertainment spots in your area that you're considering a Staycation to this summer?
 

A will (or living trust) is another of those things that is much more important once you have dependents.  However, if you want to have any say in what happens to your assets after you die, then read on.

My dad had me do some research for him on Wills and Living Trusts.  If you watch Suze Orman, she's very big on the Living Trust thing.  If you have considerable assets or a complex estate or other people are immediately dependent on you, then she's probably right.  But as my research implies the average cost for setting up a Revocable Living Trust is around $700, it's not something that most singles (without kids) in the lower income bracket are going to need or want.

My parents have a moderate level of assets, so in their case a clearly written Will should make it through probate without major delays.  I've just been trying to convince them that evenly splitting everything three ways would be a mean thing to do to us.  Cash 3 ways is easy to figure...splitting a house 3 ways is setting us up for years of headaches.  Apparently the average cost for having a lawyer set up a Will is $300.

Now if you care who gets your stuff after you die, it's important to have a will.  But spending $300 on the possibility of your death when you're trying to figure out how to afford groceries doesn't make sense.  This is the point where you really need to read up on your state law.

In Tennessee, apparently they have a sort of default formula as to who gets your money and stuff if you don't have a will (spouse and children, then parents, then syblings, then possibly more distant relatives).  So even if you never get around to writing a will, you're family still gets something. 

If you want something outside the standard formula in TN, you can write what's called a Holographic Will, which has to be in your own handwriting (not just the signature, but the whole document), and doesn't cost anything (you just need to be careful that you do it properly or it will be invalid).  However it may not be valid in another state if you move.  It will also need like other Wills to go through probate.

I don't have a huge estate, but because I have a business, I need to get a good valid Will set up.  I have some files that need to go to certain people outside my family, and assets like my car, books, and collectibles that I want to go to certain people.

One way to get your cash to skip probate is to set your bank accounts up as P.o.D. or Payable on Death.  Basically this means you name a person(s) who will automatically be able to draw from your account on the event of your death.  All they have to do is show up to the bank with your Death certificate (and probably some form of I.D. for themselves).  I have two non-business accounts, a Money Market and a savings.  I set them both up with P.O.D.s yesterday, and it was really easy.  I just gave the name and signed a couple of forms.  I named two close family members, one who's living with me and one who isn't.  The bank told me I could name as many people as I wanted, but only one of them could show up and draw the money from the account.  I told my father I had put his name on there, because I want him to pay any funeral expenses out of my savings.

While we discuss several suggestions for reducing your shelter costs in our book, we don't spend much time on buying, mainly because most people earning minimum wage (or close to) have no business buying a home. But for many of us, it's still one of our long term goals.

My general rule of thumb is that you're ready to buy a home if you can save up a 20% down payment, and can afford double the monthly mortage payment after all other living expenses are covered.

Dave Ramsey says mortage payments on a fixed 15-year loan should not be more than 25% of your income (which is more straight forward). He has a nice section on Home Buying Tips up on his website that steps you through the process. If you're willing to do the research and paperwork, you don't have to be dependent on a realtor, but for most people it's probably worth the extra expense...experience is valuable.

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I would like to make a list of TV shows (and/or websites) that are helpful to people on a tight budget / in the lower income bracket:

My mom keeps HGTV going during all waking hours, so Free Style and Clean House pop up first in my mind.
PBS has lot of great programming for children...but I admit, other than Mystery, I don't watch much of their adult stuff.

Is there anything on Food network or DIY or another channel that comes to mind?
Or maybe a youtube channel with thrifty tips?

poor_skills is a very cool community. I decided to do a search on LJ to see if I could find more communities with a similiar vibe.  I didn't join all of these, but I've listed the ones that I found that seemed worth mentioning.

First the active goodies:

dumpsterdiving I've heard this has gotten more popular. I'm not against scavenging, but there are a lot of safety issues to bear in mind. Sometimes people throw perfectly good things out, because they're too lazy to donate them. However a lot of trash is trash. Anyway if you're interested, here's a community for tips, announcing finds, and discussing legal/safety issues.

jobsupport I added this one to my friends page. It's a forum for discussing job/job hunting related questions. Thought it might come in handy.

goodbyedebt community devoted to getting out of debt.
debt_support similiar to above.

wealthandhealth I'm joining this one too. Very new community, but great concept. It's all about eating healthier and saving money at the same time.

budget_travel Traveling on budget. Cool.

brokefolks ...eh, honestly with poorskills it's kind of redundant, but same idea.
personalfinance Spreading the budget love to the middle class.
frugalliving more money saving idea swapping
budgetcuts101  and more

dave_ramsey the unoffical Dave Ramsey LiveJournal community. I am a Dave Ramsey fan, so I thought this was cool.
(Good example of Ramsey's Baby Steps [giant leaps] here: http://community.livejournal.com/dave_ramsey/10475.html )

microliving This seemed cool. Space can get expensive, so learning to get by with less is helpful.



The now dead, but might be revived:
spendthrift was started in 2003, last post 2004...looks likes a good idea that never got off the ground, but it's still technically open.
brightandbroke the intellectual side of poverty, I think, last post is 2007.
growing_food full or mini-garden can help suppliment the diet. Last post 2008.
simplifylife  Simplifying doesn't always save money, but often the two go hand in hand.  Main posting stopped in 2007, but there is one 2009 post hoping to restart things.
food_budget_100  food budgetting, UK version.
starting_small Small scale investing...interesting... my brother is getting close to the stage where he needs to think about investing, so I'll probably be doing some posts on the subject in the next few months.
debtproofliving  I like the name.

There were several location specific "poor" communities like :
poorintampabay , poorinbc  ,poorinpdx ,poorskills_au, etc. etc. I was too lazy to check all those out. 
 

First, some good advice on not overdrawing your account from someone inside the bank: http://community.livejournal.com/poor_skills/3123673.html

The people who organize our neighborhood yardsale have gained some good sense, and moved it from the middle of summer to the end of May.  I'm back on my crusade to get our basement organized, so we're participating (saves us the cost of a newspaper ad too).  Many of my friends are in apartments or only have a few items to get rid of, so I'm offering for them to bring their stuff to our sale.

Yardsales are great way to get rid of unwanted stuff and make a little money to soften the blow.  This really is the best time of year for them (late spring or early fall), not too cold, not too hot.  If you don't have enough stuff (or a yard for a sale) don't be shy about asking friends if they're going to have a yardsale that you can contribute to.

I finally have weekends off and some semblance of a regular schedule (kinda scary), so I'll try to get back to posting regularly.

A comic to help make up for the lack of posts lately: 
(And a reminder that you need to submit your income tax forms by the 15th / Wednesday if you haven't already.)

I had a discussion with my co-teacher today about life insurance, and who needs it, ought to have it.

The biggest indicator of whether or not you "need" life insurance is whether or not you have someone else depending on you financially.  Technically I don't have any dependents at this point, so I don't really "need" life insurance.  However my parents are getting older, and while they did many things right, planning for retirement wasn't one of them.  I moved back home partially to help them out financially, so the life insurance I got was really for their sake rather than mine.

If you don't have dependents, then getting life insurance is not a big concern.  You would be better off building up your emergency fund and taking care of more immediate concerns.

Once you have a spouse, kids, or other people who become dependent on you, then you may consider what would need to be done for them in the case of your death, and it's wise to plan for that possibility.

I have my first baby starting in my nursery on Monday, so this last week I went out insurance shopping.  Ended up going with State Farm, partially because they have an office within walking distance of my house, and partially cause I was able to bundle pretty much everything under them.

It's gonna cost me a little over $200 a month, but I was able to get some basic health insurance, renters insurance with high liability (for my business), as well as car and life insurance.  My business is doing better this year and start up costs are out of the way, so I think I can handle that on a consistent basis.

Now the deductable on the health insurance is the highest they offered, $5000 with no vision or dental, but the plan allows me to have a Health Savings Plan/Account (can't recall the right term at the moment) and that's something I really wanted.

I'm not saying, hey everyone go do what I did, cause insurance needs are going to vary a lot from person to person.  But I'm happy to have that figured out for myself.  I went with the high deductible plan, because I have no dependents, I'm pretty healthy, and between my emergency fund and my parents, I'm confident I could handle that first $5000 should something major come up...and it was cheaper.

Anyway, being healthy and safe are good ideas for many reasons, but the insurance thing got me thinking about those two things in financial terms.  It really does save you money to take good care of yourself.  Accidents and sickness can happen to anyone, but you increase your chance of avoiding them if you take the proper precautions.  Don't use tobacco products, eat healthy, drive responsibly, etc.

Hope everyone has a great St. Patty's day this week.  If you're planning to drink, please be moderate or at the very least make sure you have a designated driver.  I plan to have fun without drinking  They're having a St. Patty's celebration for the singles at my church tomorrow night, which would probably be fun...but actually I've been so busy, I'll probably just stay at home, be lazy, and read something.  That's fun too, just in a quieter way.

I got $475 back this year. In our book, we divide income into two categories expected (or predictable) and unexpected income.

Expected income is income you regularly receive every week or month. Unexpected income is any money that you don’t expect on a regular monthly basis. Because your tax refund comes but once a year and you don't know what it will be until you sit down to figure out your taxes it falls in the category of unexpected income.

We encourage you to make a budget/plan for your unexpect income using these priorities:

Priority 1: Needs

Priority 2: Small Debts

Priority 3: Emergency Fund

Priority 4: Large Debts

Priority 5: Big Dreams and Entertainment
 

At the moment, my basic needs are met, and I don't owe anyone money.  However, I really need to get my Emergency fund built up, so the entire amount is going straight to building up my emergency fund.

Since we're in a recession, I know Suze Orman has been suggesting increasing your Emergency Fund to 8 months of living expenses.  It's not a bad idea.  At least 6 months is your goal.  More is nice, but you don't want all your eggs in one basket...I'd say absolute max on an emergency fund is a year of living expenses.  If you've got that much saved up, it's time to look into diversifying with longer term investments that could give you a higher return (or at least break your money into different accounts).

One of the concepts they discussed in my small business class is that businesses should try to keep an emergency fund/accessible cash too.  Though they called it something else and used different math to figure it.  Their math involved taking the cost of daily operations and multiplying that by the number of days in your cash flow cycle.  For instance, if your cost of doing business is $100 a day and your cash flow cycle is 30 days, you'd want to keep at least $3,000 in cash around to keep things going and more than that isn't a bad idea.  The cash flow cycle math was a little confusing, but I grab onto the concept of building up cash for my business.  So seperate from my personal income, I'm also starting to slowly build up an emergency fund for my business.  I thought I'd throw that out there in case one of you is also operating a business either full time or on the side.

Sorry this month has been so IRS/tax focused.  I've been working on my business a lot, attending classes, preparing my first product launch, learning about W9 and 1099's from the sender rather than receiver point of view.  I even had to call up the IRS because I was having trouble finding the information I needed on their website.  They were very friendly and helpful, walked me through what I needed to know about preparing for 1099s.  (I have a cafepress site call " Amoeba Dreams", that I've decided to move from being hobby to part of my business.  There are 3 other design contributors beside myself, and I needed to figure out how to reimburse them with the proper paper trail.)

 

Filing cabinets are nice, (if you're local or passing through Nashville, I can give you one...we have two left over from my grandparent's house just eating space in the basement), but a box or expanding file, heck even a simple binder or folders will work.  However you do it, find some place to keep important papers together.  If you do a lot of your financial work (banking/taxes) online, make sure you back up your records to disk every so often and know where the disk is.  It will save you a lot of headaches and not just at tax time.

This comes to mind because I've misplace my schedule B (at least I'm pretty sure that's what happened...it's possible it got lost in the mail, but I could have sworn that I saw it...).  Normally I start a folder at the beginning of each tax year and put pay stubs and anything that could be tax related into it, so it's pretty easy at the end of the year to pull the folder out and fill in the blanks.

And it's useful for things other than taxes.  I have a folder for my car, where I keep the title as well as the receipts for any repairs or maintainence that I have done to it.  So for example if I'm trying to figure out when I last had my oil change, I can just look in there.  Takes some guess work out of it.

I went to a business class this last week that spent an hour emphasizing to us how useful it is to keep your records up to date so you can see where your cash is going or needs to go, and it's something that can apply to your personal life as well as to a business.