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Spring Break, Being Money Smart, and Traveling

Couple Money links around the web

My mom is on spring break this week so we’re doing a family weekend trip. She offered to watch the kids for a couple of days, giving us some time to unwind at the beach. Yay grandparents!

If you’re on break too, I have some great reads to share.

Couple Money Around the Web

Besides writing here, I also run the Couple Money Podcast, contribute to other sites, and occasionally do interviews. Here are few things I’ve been busy with:

  • My Moneystepper Savings Challenge Update on Moneystepper: Since joining the challenge, it’s been a busy few months with having our second daughter and getting back to work. I talk to Graham about the progress we’ve made so far on our 2015 goals.
  • 5 Smart Ways to Spend Your Tax Refund on TurboTax: We received our tax refund last month and it was divided between helping us grow out net worth and covering the weekend trip. I listed some other ways you can spend your money to boost your finances.
  • The Saver’s Credit Explained on TurboTax: If you put some money into your retirement accounts in 2014 and haven’t filed your taxes yet, come check my post to see if you qualify for the Saver’s Credit.
  • How to Travel for Free….With Kids on Couple Money Podcast: Dan Miller from Points with a Crew shared how he and his family of eight save a ton of money when they travel around the country.

If you haven’t check out the Couple Money Podcast, please do. Besides Dan talking about travel, we recently had episodes covering credit unions, buying a house, and starting a home garden. It’s free to subscribe to CMP!

Money and More Posts I Loved This Week

I found a few gems this week on saving and earning more money.

I hope you and your family have a wonderful weekend!

How Credit Unions Can Boost Your Family’s Finances

Credit unions can be a great place for your joint bank accounts

Last week the Couple Money Podcast ran an episode about using credit unions for your joint accounts. Joe Mecca from Coastal Federal Credit Union was the special guest and he took time to answer some questions that people have about credit unions.

If you two are looking for a place to move your money, then you may want to consider adding some local credit unions to your list. You may find that they are a better fit for your financial goals.

What Makes a Credit Union Different?

Credit unions offer many of the same services as a bank – checking, saving, and money market accounts. Members can apply for car and mortgages. So what is the big deal between them?

The main difference with credit unions and banks is how they are structured. Credit unions are not-for-profit cooperatives that serve their members. When you join the credit union, you are part owner.

While a bank may reward shareholders, credit unions return their surplus income to their members in the form of dividends, better interest rates (both with deposits and loans), other benefits.

Bankrate’s 2015 Credit Union Checking Survey found that credit union checking accounts also tended to be cheaper than banks in other areas:

  • Lower overdraft fees
  • Lower minimum amount to open an account
  • Lower fees to use an out-of-network ATM

On top of those lower fees, surveys reveal that credit unions have higher customer satisfaction. My personal experience with credit unions has been fairly positive. One thing that appealed to me was the community feel and the personalized attention.

How Can You Qualify for Membership

While banks can be open to just anyone, credit unions do have a field of membership. Back in the day, many credit unions were based around an employer such as a school system or the state government. Now there are credit unions based on numerous bonds such as:

  • membership in an organization
  • geographical location
  • group membership – such as a church or school

As you can see it’s expanded to the point that there is probably a credit union that you qualify for in your area. You may also apply to be a member of a credit union if a close relative is already one.

Finding the Right Account for Your Money

Whether it’s a bank or credit union, you want your money at a place where it is not getting drained by ridiculous fees. When you’re looking at credit unions ask questions and see if they can offer a checking account that addresses your needs such as:

  • NCUA insured
  • No maintenance fees
  • Pretty fast (and free) bill pay system
  • Conveniently located ATMs
  • Good customer service

I learned from Joe that credit unions that particpate in the Allpoint network gives you access to surcharge free ATMs around the world, a big plus if you travel much. If you want to see if a local credit union can provide what you need, you can use this tool from the National Credit Union Administration

Thoughts on Credit Unions

I’d love to hear from you about your experience with credit unions – good and bad. Feel free to share your thoughts in the comments. How many of you are members of a credit union? What kind of service do you get?

What’s Your One Page Financial Plan?

writing financial goals

While I’m a firm believer that couples should have a financial game plan, I don’t think it has to be complicated or tediously detailed. Obsessing over the numbers can be counter-productive as we all have unexpected events happen which can throw our carefully laid plans off.

It’s better to have a plan with enough flexibility to handle these curve balls so you can simply adjust as needed. If that sounds like something you’d be interested in, then you should check out Carl Richards’ new book The One Page Financial Plan.onepagebook

It’s a great read to have around whenever the two of you need to brush up on your financial and personal goals. (Pssst… you can enter to win a copy – check out the details after this post! )

The Most Important Money Question You Need to Answer

Most people visit financial planners like Carl because they want answers on what to do with their money. They want to know how much to save and invest, which debts to pay down first, or whether or not they can retire soon. The last thing they’d expect to hear from a planner is a question that Carl Richards asks his clients – Why is money so important to you?

In The One Page Financial Plan points out that understanding why you want to build your finances is critical. A CFP that is truly interest in you would give advice tailored to your needs, goals, and resources.

Imagine if you want to the doctor and she prescribed something before you’ve been examined and interviewed. You’ve probably find another doctor and quick. The same should apply to coming up with a financial plan – you need to look at the current situation and come up with the destination before you map things out.

As you’ve seen here on Couple Money, I think starting off with goals can be more productive. However it can be difficult to talk about money if you haven’t had much experience (or if previous attempts were tense). So how can you two apply this with your own finances?

Your One Page Financial Plan

Next time you have a money chat (go out and have some drinks!) bring a note pad and try it out. Talk about what money means to each of you. You may be surprised by what your spouse has to say.

Don’t worry so much about the numbers, just see think and dream about where you want to be and how you’d like to get there. When you two have a general idea of what you’d like to do, go ahead and write those down in the notepad.

Somethings you may want to keep in mind when talking about your plan:

  • Pick the right time to have the talk. Being in the right frame of mind is huge, so please avoid having this chat right after a stressful day.
  • Make it fun. Get out of the house to chat.
  • Don’t push it. If you two can’t get on the same page now, it’s okay. You can come back to it once you’ve had a chance to relax and think up some ideas.

Win the Book!

For those looking to improve your finances this year I have good news – I’m giving away two copies of the The One Page Financial Plan!

All you have to do is share your financial plan with me.

You can either:

I’ll round up all the entries and choose two winners next Monday, April 6, 2015 during my lunch break (at 1pm ET). I can’t wait to hear from you and see what big plans you have for this year!

Are Store or Discount Brands Always the Best Bang For Your Buck?

Hwo to Get the Best Deals When Shopping

If you see the title, you may have picked up on the fact that price is only part of the equation. While we do enjoy saving money whenever we shop, we also consider purchases for their value.

I had a great conversation last week with Len about finding the best deals with store and name brands. Len has been running a fantastic series where he has a panel of family and friends test out foods like potato chips, sodas, and cereal.

While the store brands were cheaper and scored better, they weren’t winners all the time. Sometimes, the panel picked the name brands.

And that’s okay with me.

When to Splurge and When to Scrimp with Groceries

Let’s admit there are some things that we’re just picky about. The taste, feel, whatever of certain products just seem better. (Personally I haven’t found a comparable Oreo substitute.)

The problem is when you’re paying more for a product and not seeing a real benefit. That’s when you money is paying for marketing.

You may be surprised at how little difference there is between the two. Some products are made in the same facility and just get different labels or they have almost identical ingredients. Couples can save quite a bit of money if they know which ones to buy.

The only way you can find out is to test it out yourself. Start shifting some of your spending towards the generic or store brands. If you don’t like them, you can always go back. I believe most families will find that they don’t need to have everything be name brand.

Value Over Price

Besides groceries, many couples can reduce their expenses by considering how they plan using items like clothing and electronics.

Stretching a dollar means more than just looking at the purchase price. It does us no good to have to keep buy cheap clothes and gadgets if we have to constantly replace them.

We found that it can be better to pay a little more upfront rather than being drained slowly. It comes down to value over price. Let’s take buying our girls’ clothes.

With a newborn, there isn’t so much a need for pricier pieces because she hardly moves in them so they don’t wear down. They mainly get spit up on and grown out of so I don’t see the more expensive outfits being a good deal. I still buy adorable pieces, just not going to break the budget over them.

For my older daughter, I do look a little  more at the quality of the clothes more carefully because I know she will be using them often.She will out grow these as well, but she when she plays, it’s outdoor kid fun so I really want those items to hold up.

Electronics are they same way. We replace our phones and gadgets like tablets when they break down or there is a considerable improvement or functionality in the new models. When do buy however, we are willing to pay more up front because we expect it to last for awhile.

Thoughts on Getting the Best Deals

That’s our take on things – I’d love to get your thoughts on how you shop. How do you find the best deals on groceries and other items? Have you’ve found any stores or brands that have consistently good deals?

How Much House You Can (Really) Afford

learn to calculate how much home mortgage you can afford

With our baby’s arrival and my returning to work, we’re focusing our attention on two of our goals for this year – paying off the student loan and buying a house.

As we begin the process one of our first steps is seeing how much of a mortgage we can comfortably afford and figuring a down payment goal.

If you’re also in the market for buying a home, I hope our notes can help you two be better prepared.

True Housing Costs

When figuring out how much we can afford on a house, we tried to keep in mind that there are certain expenses to owning a home.

Lenders typically focus on the actual mortgage payments, but it’s up to you to look at related housing costs like utilities, house maintenance (yard care, small projects), and a house emergency fund (replace roof, HVAC).

We discovered this when we bought our town home. We have a homeowner’s association fee that has gone up every year since we moved in.

Since we are looking at older homes for our next place, we have to factor in some buffer money for possible repairs. Thankfully we have friends who live around where we hope to buy, so we have some idea of what we can expect. (Though you certainly can’t plan for everything!)

Calculating Monthly Expenses and Budget

Now take another step back – what other obligations and goals do you two have? Owning a house is one of our personal goals, but it’s not the only one.

Our monthly budget has to have enough room in it so:

You may have similar goals or you may not – the point is many lenders when calculating how much house you can afford don’t take these factors into account. They may simply look at your income and your debt as the biggest factors. That’s why it truly pays for the two of you to go ahead and run the numbers for yourselves.

For us we take a fairly conservative position with the mortgage. When looking at houses, we’re basing our maximum limit on just my husband’s net income.

Examining the Down Payment

We want to make a much bigger down payment this time around with the goal of having a mortgage that is less than what we are currently paying.

The advantage of a bigger home down payment is that it will reduce your monthly mortgage payment. If you put 20% or more, you can avoid paying the additional expense of private mortgage insurance. You may also get a better deal with the lender on your interest rate.

Thoughts on Home Ownership

Enough from me, I’d love to hear from you. For those who already are home owners, what costs have you had to deal with that you didn’t expect? Besides mortgage payments, what have been your housing costs?