How I paid off my Lexus in 22 months

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This Wifes Life Lexus PayoffI almost feel like I need a quick disclaimer on why someone who is frugal would a) finance a car and b) buy a luxury car like a Lexus. Here’s the story.

Twenty-three months ago I was driving a Volvo XC90 and with was a huge POS. I purchased it from a friend for $8,000 and soon realized there were a plethora of things wrong with it–most notably, the odometer didn’t even work so I didn’t even know how many miles it had! Plus, every time something broke down on it (and this was often) it cost at least $2,000 to repair.

So 22 months ago, my husband and I had our eye on a Toyota 4Runner at a Lexus dealership. I will admit, I had always wanted a Lexus and sort planned this out to look at the used Toyota at the Lexus dealer. We drove the 4Runner and hated it. The car salesman suggested we try a Lexus RX350. We did, and the rest was history.

And as to why? The Lexus was actually $10,000 less than the 4Runner. It is a 2010 and had 70k miles, but, come-on, it’s a Japanese car that will run virtually for 300,000 miles. Because of the high miles and with my trade-in for the POS, I financed $20,000 with a car payment of $405.80. If I would have paid the minimum for the 60 mos. the total would have been $24,348. Overall, the Lexus is a safe, excellent quality car that will last me many more years.

Emotionally, I justified the purchase as a 40 year birthday present to myself and I had just passed a major accreditation in my field of work…time to celebrate. I financed the car because I didn’t want to wipe out my savings account to buy it and I was worried the Volvo would break down and keep costing me money in repairs. I also knew I would pay it off quickly.

How I did it?
1. Paid more than the minimum payment–always.
2. Paid toward the principal balance (although Lexus Financial doesn’t make this easy…I had to mail the payment in)
3. Every penny of my side-hustle went toward paying extra to the car loan
4. Made this part of my debt snowball and got after it. This is done by paying the minimum to other debt then taking as much as possible from my budget to pay extra.
5. Enjoyed watching the balance dwindle.

I’m so happy to have purchased this car. It will last me for years to come. Getting it paid off early and being able to move on to the next debt (my credit card) is one more step closer to becoming debt free, financially independent and retiring early.

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Tax Time 2015

Taxes are due in the United States on Monday, April 18. It’s always that dreaded time of year where we pay to be citizens of this fine country. Or it’s dreaded for me because I haven’t gotten a refund since the mid-nineties.

My husband and I file jointly to save on taxes, and we have them prepared by a tax company. Sure, we could do them ourselves, but we’re worried we could mess something up. They also do this nifty report that tells us we pay 14% of our income to Uncle Sam. We are able to save off of our mortgage, student loan interest and depreciation on our rental properties. Like everyone else we pay on our interest income and bank bonuses. I’m going to look into investing in an IRA next year to save a little bit more.

How do you save money on taxes? Do you prepare them yourself? Do you set up an IRA for tax purposes?

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Will you keep Netflix?

netflixIt was just announced today that Netflix will raise it’s monthly fee from $7.99 to $9.99 beginning next month. Moreover, most of the 17 million customers who will be affected don’t even know it yet. So, I went on a hunt to see if my account would be increased. I’ve been such a zombie about this automatic payment that I had to request my password to login. Once logged in, it appears that my pricing schedule is good until May 9, 2016, which probably means I’m due for the increase.

Sure, the $2/month increase doesn’t seem like much, especially to those who aren’t money conscious. And, at $7.99 or $9.99 it seems pretty inexpensive, but it’s still about $96/year and will be $120/year. If I invested the $120 into my Lending Club account, I would make approximately 8% and at the end of the year would have almost $130. If I saved this for 10 years it would compound and I would have $2,137. This is an indication that Netflix is a waste of money for me especially since we only watch House of Cards.

This news began a conversation with the husband about how we really DON’T even use Netflix–at all. In fact, as mentioned before the ONLY thing we watch is House of Cards. We’ve decided to cancel the service regardless of the price increase. Adios Frank Underwood we’re investing ourselves.

Speaking of investing. It also appears for those of you holding stock in Netflix, Inc. (NFLX) won’t see an uptick in your holdings. Read more about projected Netflix stock in Dan Burrows online article “Coming Price Hike Doesn’t Mean Squat for Shares–Cancellations Should be Minimal and Already Baked Into NFLX Stock.”

After this analysis, I actually feel guilty for keeping Netflix for so long. So, will you be keeping Netflix? Do you have an automatic payment that you forget about? Did you already drop Netflix years ago when you made the decision to be Financially Independent?

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What I learned my first week of blogging

My first week of blogging in the personal finance blogosphere has exceeded my expectations! Although according to Google Analytics, only a handful of people have stopped by to actually read my blog (thanks mom), the experience and connections have been amazing. I’m following several fellow bloggers such as She Picks Up Pennies, Millennial Money Man and Thrifty Meets Spendy on Twitter and learning something new from each of them daily. Bonus, it’s been an inspirational and motivational week as one fellow blogger hit early retirement and chronicled his entire experience here.  It has been a tremendous experience and if nothing more comes of this blog, I won’t regret the connections, friendliness and willingness to help from those who have a passion for getting out of debt, living a frugal lifestyle…it is definitely infectious. Onward!

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April No Restaurant Challenge

Frugal AprilOne key to being building wealth, retiring early, becoming financially independent or being debt free is to spend less than you make. Being frugal is one way to do this. Always look for bargains, DIY plans, free things…anyway to cut back really. Some of my favorite FP gurus even go to the extreme of using only two tanks of gas a year. I so admire them, but to be honest, I’m more of a “fringe frugal” type of person. I always look for deals, won’t buy clothes unless they are on sale and basically spend less on some items so I can spend a little more on quality items. What I do like to do is continuously challenge myself to save money or spend less. It makes getting out of debt fun!

So, for the month of April 2016, I’m doing a “no restaurant month.”
My pledge…

  1. I will not spend any of my own money in a restaurant or bar. If it’s a business lunch, coffee, drinks then I have to go, but I won’t be going on my own accord.
  2. I will take my lunch to work everyday.
  3. We will cook at home.
  4. I will say no to happy hour. <—this will be THE major challenge.

Check out my daily progress here. Want to join me? Have you ever done a no-spend challenge? How was it?




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Budgeting Basics-Where to start

This Wifes Life Budgeting Basics

Creating and using a budget can be a very daunting task. But a budget is the very foundation to being able to win with money. It’s hard to know where to start, what line items to put in the budget, how much money to spend (or not to spend) on each item and this is even before you consider how you’re actually going to follow the budget. Well, pour yourself a glass of wine and let’s walk through some budgeting basics.

  1. Write down (or enter into a spread sheet) how much you spend on each category.  You may be able to do this in one sitting, or you may need to go for a month and track your spending to see where you are. You can use my spreadsheet here.
  2. Each time you spend from a line item, deduct that amount from your sheet.
  3. If you use the envelope system, it’s easy to take out all the cash and run your budget from there.
  4. I always pay all of my bills the day I get paid…including overpaying on my debt.
  5. The bottom two numbers should always be identical, and should match your bank account. This let’s me know that I’ve balanced…if I’m off, I immediately figure out where and why.
  6. At first, budgeting is hard work, but the more you do it, the easier it becomes…and it’s really the basis of a healthy financial life.

There are several online budgets available. For years I used Dave Ramsey’s My Total Money Makeover Gazelle budgeting software to keep track of my budgeting. I actually paid $9.95/mo. for the service. My paychecks are bi-weekly and it worked well with my needs. Then his company decided to phase it out and move to Every Dollar. Every Dollar appears to be a good program, but it’s not friendly for those of us who want to budget bi-weekly. I began to search…and search…and search. I couldn’t find a good budget for bi-weekly paychecks. What is a girl to do? So I created my own spreadsheet. My only regret is that I didn’t do this before and save the fee I had been paying.

To start your own budget, you can copy my simple mock budget here. And, be sure and check out one of my financial heroes at Budgets Are Sexy and his list of resources for budgets.

BTW, I’d love feedback and questions about my budget template. It seems simple to me, but I’ve been using a budget for a long time and it may be confusing to others. If you need some help with your budget, please email me and I’m happy to help walk you through.




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Buying a bicycle one five spot at a time

Save $5 at a timeSaving money never seems to be easy. There’s always something to pay off or something to blow your money on. In fact, I almost have to trick myself to save money. No longer is it a struggle…I found a fun way to save money without sacrificing debt repayment or other budget needs.

Here’s how it works. I use cash and the envelope system for line items like food, clothes, beauty, and extras. Every time I’m given a $5 bill as change back, I put it in a special marked envelope and save all the fives for something out-of-budget or something that I normally wouldn’t just unload more than $20 to buy.

Last weekend, I had $350 in five dollar bills saved up for a mountain bike (I’ve also done this to buy golf clubs and a Cannon Rebel T5i camera). I had the cash, and waited for the annual sale a local bike shop….then pounced. I’m in love with this bike, a Trek WSD 820 beginner mountain bike. I’ve already taken it out to the trails near our home and it’s proven to be a challenging way to exercise. It took me about seven months to save the $350.

Now that I have every toy a girl in Colorado could need want, the $5s are going toward Christmas shopping. By Black Friday I should have another $400 that I’ll use for gifts.

You can do this too! Every time a $5 bill is in your possession you put it in an envelope or jar. Some savers take the money and deposit it into a checking or savings account. Others, like me, wait until there is $50 dollars worth and trade it in for a $50 dollar bill then put the $50s in our safe.  You can use the money for travel, something special, Christmas spending, investing, your emergency fund, and so on. Have you ever done something like this to save money? What do you use the money for?




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