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Opened a Savings Account for Our Baby Girl

Elle — Tue, 06 Dec 2011 13:44:24 +0000

Gift Money = Savings Account

The other weekend ING Direct had a special on new accounts, including a $27 bonus for opening a kids savings account. We decided to go ahead and take advantage of the deal. We opened a savings account and used gift money our daughter got from her Nana (great grandma).

Possible Plans for the Money

What are we saving for? We honestly don’t have an idea right now. We’re using it to hold gift money that our family and friends have gave to our baby.

It’s small now, but we’re looking at options for the account in the next few years. There are some ways we can use the money for our daughter that I can think of, such as:

General Savings: I think the savings account at the very least will always have a chunk of money in it for savings. I’m think more for long term goals vs a toy fund.
Car Fund: One day our baby will get old enough and responsible enough to want to drive. We could use her little stash to cover the car expenses.
College: When the balance has a bit of a buffer in there, we may take a portion to open up either a 529 College Savings Plan or a Coverdell Education Savings Account.
Investing: Perhaps when she gets old to want to understand the basics of investing we could use a little bit of this money to open an account.

Whatever we decide to do later, we’ll discuss it together. Our hope is that our daughter can use this account to not only learn about finances, but also responsibility.

Good news is that we got some time – she’s only 4 months!

Thoughts on Saving for Your Kids

I’d love to hear from other parents. How many of you have opened up a savings account for your child? What money goes into the account?

Photo Credit: jdsmith1021

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Baby Fund is Up and Ready!

Elle — Tue, 21 Jun 2011 12:00:47 +0000

This year we’ve kept it short because having having a dozen big goals can be stressful to keep on top of and can decrease our chance of success. Instead for 2011, we have just 3 goals:

Bump Up Our Savings for the Baby – We want to increase savings to cover baby expenses.
Build Our Car Replacement Fund – We want to buy our next family car with cash.
Pay Down Student Loan – This is a reach goal and we’re hoping that we’ll be able to get the balance paid down a bit quicker.

I’m happy to report that we have achieved the first goal. Our savings has been bumped up and it’s ready (as much as you can be) for the baby’s arrival next month. Our tax refund finally came in and it helped topped us off.

Baby Fund: Why We’re Saving

We’ve been comfortable with our emergency fund/savings in general, but we wanted to step it up. We’re now trying to be a bit more conservative -having a full six months of essential expenses tucked away makes us feel a bit more comfortable. Between diapers, baby gear, and unexpected baby expenses, we wanted some peace of mind knowing that we can cover these bills as they come.

Though we expect some expenses to go decrease (less eating out for example), we want to play it safe and assume in our estimates that we’ll see an overall increase as we get adjusted to being parents.

Our Hurdles with the Baby Fund

I have to admit -saving was harder than I thought these last few months. When I first wrote about our financial goals for this year, I was pretty confident that we were going to make it. We had a system in place and a plan of action. Truth is you have to anticipate some hurdles when setting up goals.

I had mentioned earlier this year that money saved from food expenses will be going towards the savings account. I was basing that on the fact that in my first trimester I wasn’t really eating much. Well guess what? The next few months I started eating more than usual.

We also had to deal with baby expenses along the way that would work for us. We got out of the habit of doing a few big trips for items and switched to several smaller trips throughout the month. What happened is that as we made the smaller trips, we picked extra items. Those extra items added up throughput the month. While we had many of them on our list, we didn’t shop around to see if we were getting a good deal or not. We just got them because they were in the same store we were in.

We’re now back on track, but we have to remain on top of this, especially when the baby comes. I know we’ll be crunched for time and it can be quite easy to go for convenience. At the same time we have to be balanced and give ourselves some room for transition.

I’m curious to hear from all you parenting veterans on how you manage to stay focused with a new baby.

Our Baby Fund Strategy

For us automated savings is the main plan. Whenever we get a windfall such as a tax refund or bonus, having an automated deposit or transfer has helped us stay on course. While we have created some sub-savings accounts at ING Direct for specific goals, we decided to keep this in the general savings account.

If we find that our balance is steady and we haven’t dipped into it much with the new baby, we’ll reevaluate and decide if we want to use a chunk of that money for one of the other financial goals that we have. Right now, though, we rather have the money there in case it’s needed to smooth out any spending bumps that may come up over the next 6 months or so.

Thoughts on Savings and Financial Goals

We shared out progress, how about you? Since it’s halfway through the year, how are you doing with your financial goals? Have you had any hurdles while working towards them? What has been going well? Please share your thoughts – I think it’ll be great to learn how others have accomplished their financial goals as couples.

Photo Credit: epSos.de

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Progress Energy’s EnergyWise Program

Elle — Mon, 28 Mar 2011 12:00:34 +0000

Letter from Progress Energy

Earlier this week when checking the mail I noticed a letter from our electric company, Progress Energy. Thinking that we just sent a payment, I was curious to see what they sent. It was an introduction for a new program that Progress Energy was having in our area called EnergyWise.

EnergyWise Program

I decided to read on and get more information on this program. It involved having a device installed to our air conditioning system. The energy company went ahead and explained the benefits of the program:

Environmentally friendly
$25 annual bill credit
No cost

It’s for residential areas and it’s completely voluntary. It sounded good so we went ahead and examined our energy bills over the past year.

Right now our average bill in the winter is around $75/month and around $80/month in the summertime. We’re curious to see if we could lower it a bit more so the money could redirected to some of our other financial goals.

They answered some of my questions that I had about the program, including:

If Progress Energy turns my air conditioner off when it’s hot, won’t it impact my comfort?

EnergyWise is designed to cycle the air conditioner’s compressor off and on at 10-15 minute intervals, not to turn it completely off. Your system’s fan will continue to operate normally. An average home can generally expect at least a one degree temperature rise per hour during a cycling event. An event will not last more than four hours a day. Depending on the energy efficiency of the home, some customers may experience a more significant temperature rise.

For your convenience, EnergyWise will not be activated on weekends or holidays, except in the event of a system emergency. PLUS, you may choose up to two days per summer season to override the cycling of your air conditioner.

Won’t interrupting my air conditioner cause it to run longer once it comes back on and increase my electric bill?

No, you should not see an increase in your electric bill. Progress Energy is only changing the time of day your air conditioner runs. Your air conditioner should run for the same number of overall minutes in a day, so your bill should be the same whether a cycle occurs or not.

Smart Energy Grid – Why It Matters

I checked out the link included in the letter to get some more information about the benefits.

When high electric demand places an unusual burden on the area’s power supply, EnergyWise Home helps use the available power more efficiently. This reduces the need for peak-time power that is often generated by fossil-fueled power plants and lessens greenhouse gas emissions. It’s an easy way you and your family can make a real difference.

EnergyWise helps Progress Energy temporarily reduce energy consumption during times of peak demand. This reduces the need for additional peak-time power that is often generated by fossil fueled power plants. Participation is free – plus you’ll receive an annual $25 credit on your energy bill.

There is no appointment necessary for the program and it would be nice to help out with energy consumption plus save some money.

After discussing it together and it looks like we’re going to try out the program.

Thoughts on Trying Out EnergyWise

I’d love to get your take on the situation – what would you do and why? Do you think this is a good way to save some money? If you’re looking for how others handle their electric bill, here are some of my favorite posts:

I hope these posts can help you save a bit of money so you can reach your own financial goals in 2011.

Photo Credit: G & A Sattler

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Our Savings System – Lots of Goals!

Elle — Mon, 22 Nov 2010 14:45:06 +0000

Our Short and Long Term Goals

I’ve mentioned before that having a financial game plan as a couple is a big part of reaching your goals. It can help you two develop ways to communicate effectively and focus your energies on what matters to you.

Like many other couples, we have several goals that we’re looking at achieving together. Some of our goals are for the short term while others are more long term and bigger in scope.

For these goals, we have savings accounts to organize our finances, motivate us, and help our money grow during the process.

Short Term Goals (1 year or less)

Emergency Fund – If both of us are employed, then we’re comfortable with at least 3 months saved. If one of us is steadily employed then we prefer 6 months or more in the bank. This money is not touched unless there is an emergency.
Vacation Fund - I should point out that vacations are paid with the credit card first and then we pay it off before the grace period is over. We would rather not have a hold on our checking account for car rentals and if there is a dispute, it won’t affect our day to day routine as the credit card works it out.
General Savings- This catch-all savings is basically for when we have some extra income that we haven’t allocated yet or for future planned purchases, like car repairs, upcoming video games, and electronics.

We keep our general savings and emergency fund in the same account. I know some people may view having an emergency fund mentality as a crutch, but we’ve found it to be the opposite- we’re doing better financially. I think having an emergency fund can be good or bad, depending on who’s involved. I’ve seen how people have dipped into their emergency fund for frivolous purchases.

I’ve also seen how building and maintaining an emergency fund has encourage people to continue building their finances. Having the psychological win spurs people to move onto other aspects of their finances, like debt reduction, investing, and entrepreneurship.

Getting an emergency fund started and maintained means looking at your family’s personal needs and adjusting to it. Here are some factors you may want to consider with your savings.

Family Size - If you’re a dual income couple with no kids or other family obligations, then you’ll probably won’t need as a big of en emergency fund as a family of 5.
Family Expenses – Your family’s lifestyle has a big effect on the size of your emergency fund. If you have high monthly expenses, then logically, you’ll need more money to save. If your expenses are due to unnecessary spending, then you may want to discuss ways you can lower it. If it’s due to circumstances (i.e. medical bills), you’ll have less room to work with. It’s still possible though to explore options to lower your bills.
Income Streams – If you have 2 or more income streams coming in, that can decrease the size of your emergency fund. You should still have one though, as unexpected events can happen.

One last note on our short term savings accounts – our main goal with them is to be accessible, so we prefer having them availble in high interest savings accounts rather than CDs.

Medium Term Goals (2-4 years)

Car Replacement Fund: As you can tell from our previous posts, my husband and I have been trying to avoid car loans for awhile. We paid off the car loan on the Jetta and haven’t looked back.

It’s quite possible to get a really good car if you’re serious with your car replacement fund. You need to commit to a set monthly payment (to yourself!) and a time frame for buying your dream car.

If you’re looking for general guidelines, here are my recommendations:

Current Car is between 1-3 years old- Wait 5-6 years for your next car
Current Car is between 4-6 years old – Wait 3-5 years for your next car
Current Car is between 7-9 years old – Wait at least 2 years for your next car

You can read my car buying guide to get the details of the plan. Right now the plan is getting a new car for me in about 24 months. The Jetta seems to be doing well and I’m making some low cost repairs to keep it looking as new as possible.

Long Term Goals (5+ years)

Freedom Fund: Our goal is for both of us to have location independent (mobile) jobs. While we don’t have currently any plans to live abroad, I like having the option. Besides saving money on daily commutes for my husband, he’d also like more control on projects that he takes on. He loves being a software developer and with his talent and disciple, I think working from home would be beneficial for him and his company.

This has been a goal for us before we started this blog and I think it’s time for us to create a plan to get this account started. By our original estimates, we wanted to have the freedom fund ready in 4 years. I think we have a chance of making it, we just need to get more organized on this goal.

We currently have a low interest student loan and our mortgage as our only debts. Right now, the goal is to pay off the student loan and have buffer fund to handle expenses with he makes the transition.

I’d really like your feedback with this long term savings goal. If you’ve started one, how did you go about it? Did you pay down all your non-mortgage debts first and then worked on it. Or did you deposit something in there while working on your other financial goals? What’s your suggestion on how to how much to save in the account?

Why ING Direct for Our Savings?

We’ve been with them for years and love it their checking and savings accounts. They have all the major features we’re looking for with a bank:

Covered by FDIC
No monthly maintenance fee
$0 required minimum balance
Free online BillPay service
Conveniently located ATMs
Earn some interest rate if possible

While they don’t have the highest rates, they’re still competitive and their customer service has been great for the few occasions we’ve had to use them.

Automating Our Savings

The key to keeping our goals is automating our deposits to each of the savings accounts. We have some money transferred over from checking to savings regularly, like a bill. when we first got married and our income was really small, the deposits were small, but as we’ve received raises, we’ve been increasing the deposits accordingly.

If you’re looking to get started, find an FDIC bank or CUNA credit union in your neighborhood that offer high interest rates for savings and watch it grow faster. Look at Bankrate to compare checking and savings accounts. You should be able to find something to suit your needs.

If you’re looking at jump starting your savings and think your social network can help, you may want to look at SmartyPig. Besides offering good interest rates, it also allows others to contribute.

Prioritizing Deposits

As deposits come in, we allocate it to the appropriate savings account. While there is a minimum monthly deposit, due to the valleys and peaks I sometimes prioritize where the ‘extra’ money goes into.

Currently our plan is:

Car Replacement Fund (50% – until goal is met)
Freedom Fund (30% )
General Savings (20%)

I’ve upped the scheduled deposits starting next month and I’m hoping that we’ll see some little windfalls to put some more aside for our goals.

Thoughts on Savings and Goals

I’m not saying our savings system and accounts are the best way to go for you. I’m just pointing out how the system has helped us. I know everyone has their own system, so I’m curious to see how you guys do it. How many bank accounts do you have? How do you stay on top of it? I’m be curious to see how others handle this.

Please share your thoughts – I think it’ll be great to learn how others have accomplished their financial goals as couples.

Photo Credit: linh.ngân

Update! This post was included in the Carnival of Personal Finance!

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BJ’s Warehouse Club Trial Membership Offer

Elle — Mon, 15 Nov 2010 16:43:19 +0000

I recently went through the mail and noticed a trial membership offer from BJ’s for 60 days. For people debating whether or not a warehouse club membership is a good deal, using a trial membership can be a great test run.

With the trial period open now, I wanted to share some highlights of a BJ’s Wholesale Club membership. Hopefully, it’ll help decide if it’s the right move for you.

Membership Costs and Benefits

Like other warehouse clubs, there are different tiers of membership, each with their own benefits.

Inner Circle ($45/year)

Here are some of the benefits:

Household and 1st Supplemental Card — No Additional Charge
Up to 3 Supplemental Cards ($20 each)

Business ($45/year)

Here are some of the benefits:

Household and 1st Supplemental Card — No Additional Charge
Up to 8 Supplemental Cards ($20 each)
Resale Privileges

BJ’s Rewards ($90/year)

Here are some of the benefits:

Household and 1st Supplemental Card — No Additional Charge
Up to 3 Supplemental Cards ($20 each)
2% Payback (up to $500/12 mo.)
Dedicated Member Care Representatives
$20 off a complete pair of eyeglasses from BJ’s Optical

All memberships also include online shopping options and a 100% money back guarantee. BJ’s also lets you use manufacturer coupons for additional savings, something that I can’t do at Costco. I also notice that they take all major credit cards, which makes it more convenient for many shoppers.

Please check their site for details on all their benefits.

Additional Benefits

Besides the in-store savings, BJ’s has some deals on various services that many people use.

Auto & Home Insurance
Car Rentals
Cell Phone Deals with Verizon Wireless
Extended Warranties
Flights
Health Insurance
Optical
Tire Center

Depending on your needs, this can be a fantastic deal for a family.

Trial Membership Details

The membership gives you an Inner Circle membership privileges (with the exception of online shopping). you’ll need a photo ID to sign up. Check your receipts to see the expiration date of your trial. Only one membership per household is allowed.

Thoughts on BJ Wholesale Club

Don’t just assume that a warehouse club membership can save you money. Double check and use a trial to see for yourself if membership is a good idea for you.

I’d like to get some firsthand reviews of current and former members of BJ’s. How would you rate the saving you get on average? What’s the best feature of your membership? What’s the worst?

Photo Credit: MattHurst

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