Intro + two questions

[jenett]

Hi there! Great idea (and name) for a community. I'm Jenett, and last spring I finally got the real adult-paying job to go with the Master's in Library Science (I'm the teacher librarian at an independent high school.) Before that, I was a (much less well paid) library assistant at the same school - great experience, but hard on my finances. I've lived in Minnesota for the last 10.5 years, and love it here.

- Various money decisions during my marriage + subsequent divorce were not really kind to my finances, and I spent about 4 years living on a painfully tight budget as a result.
- BUT! I'm 2 months away from paying off more than $25,000 in debt. (I still have student loan debt, but I'm a lot less worried about that one.)
- And I've now got enough money that I can look at all sorts of fun long-term planning. Yay!


Budget tracking

I'm playing with different budget programs and trying to find one I really like and update regularly.

I'm currently checking a trial of You Need A Budget - it's got a high pricetag ($60), but it builds a bunch of rules I very much like into the process, which I think might be worth it for me, especially the way it handles budgeting and tracking together, including rolling over budget amounts to the next month. Detailed review of YNAB 3 here.)

Switching to a credit union
I've got a recommendation from my former boss for a credit union focused on educators, and I'm working on setting up an appointment to talk to them. Any advice, though, on changing over to a credit union is most welcome! (Especially the part about changing over all my automatic payments without tearing my hair out, though I'll probably wait till summer break to do that.)

Replacing my car
My car is going on 11 years old, and it's time to look at replacements (sometime this summer.) I'm still undecided whether it's going to be a new car, or - more likely - a recent used car. Part of why I want to do the credit union thing now is that I'd like to see what they'll do for me re: a loan.

If you have a compact-ish sedan you're really happy with, feel free to tell me about it - my current car is a Saturn SL2, which I love, but since Saturn isn't a good option going forward, need to figure out what is. (Going carless isn't an option for me for health and other practical reasons.)

I'm at the stage where I'd like to look at buying a house in the next 2-3 years.
I currently rent, and love my landlady, but my current place is tiny (400 square feet), and places severe limits on some important things. (You can read more about my religious life over here, but the brief version is that I do in-house ritual and teaching with a small group on a regular basis, and a 8x10 foot front room just isn't ideal when all the furniture also has to be moveable for ritual.) So, a big goal of the next few years is going to be saving up a down payment.

Health fun
I'm finally coming out of a long stretch of feeling really lousy (current diagnosis is Vitamin D deficiency and subclinical hypothyroid). One of the things I've found that has helped is swimming regularly (fortunately, there's a YWCA about a mile and a half away on my route to/from work)

But I'm also looking at other things I can do for my health - everything from some cooking skills that would make eating better after work easier (I have a new crockpot but am still learning how to use it best) to looking at budgeting for body work, to making sure I budget for doctor bills.

(I have a sort of weird health insurance: my work pays for the first $1000 minus copays for medication and such, I pay for any costs between $1000 and $2500, and then the insurance kicks in again. I'm currently in that middle ground, but ideally want to end up with a nice buffer for next fiscal year in case it's needed, as right now, it's eating money that could go into savings instead, and I need to make payments in sizeable chunks after appointments.)

Health suggestions can be tricky, but I'm fine with ideas from people who assume that I've already given these issues plenty of thought. (And that there's some stuff that won't work for me that I'm not bothering to list out right now.)

Comments

[sara]

The right credit union can be great. We are saving several hundred dollars in fees a year by using ours -- it has basically eliminated that experience where one overdrafts one check the day before payday and gets hit with a bunch of bank fees.

And have you looked at medical savings accounts for your work-insurance gap? Our credit union actually offers one, so it might be something to ask about when you go in to talk to someone.

[jenett]

The overdraft issue is why I'm getting sick of my current bank. (I hope to not be in that position going forward, mind you, but it'd be nice to not have to worry so much about it.)

I'm also all about supporting local businesses with people I can talk to directly in other ways, so I had a "And why am I not doing this with my banking?" moment when I started thinking about this.

I hadn't considered medical savings accounts (or rather, I had, but for glasses, not this.) Realistically, I'm not sure I want to tie it up *only* for medical purposes, but it'd be handy to have a savings account where there's the money waiting if I need it. (I do have an ING account, which is where I think I want that money sitting once I save it up.)

[sara]

Yeah, it's a bit of a pain if you need it for something else, but sometimes the tax advantages can be really handy.

Oh, and unlike an FSA, it rolls over. That said, we have an FSA through my spouse's work, and we don't bother doing both that and an MSA.

Off topic rejoicement

[aedifica]

Yay! Two people I like, talking to each other on Dreamwidth!

[indywind]

Seconding the rec for a medical --or rather, a Health Savings Account. Cool things about them (at least, some versions) include:
+can be used to pay for a wide variety of health-promoting goods and services, not just medical treatment (mine allows dental, vision, and psych care, and a limited amount of stuff like nutrition consulting & fitness coaching.)
+many employers support them in conjunction with insurance, and typically contributions are pre-tax (direct deposited before your wages are taxed). If I understand correctly, you don't pay income tax on the money that goes into the HSA, only on interest it generates--the idea being that the Fed. Gov't wants to reward people for saving for their own health care. (If you decide to quit and cash out the account, you pay tax on that amount.)

+savings in HSAs typically rolls over from year to year if you don't spend it, unlike FSAs (Flexible Spending Accounts) where contributions are typically lost if not spent in a year.

There's more, but I'm a little fuzzy on which is common to all HSAs and which is particular to mine. If you wanted to pursue an HSA, but were worried about having having too much of your savings restricted to health-related use only, you might consider putting in the HSA only enough to bridge your insurance's coverage gap for a year (i.e. $1500 plus whatever you estimate for expected copays). If you're going to spend that much on healthcare anyway, you might as well make the most of it. MHO,YMMV.

I have been loving my credit union, which has provided better customer service and more options for customization in managing accounts, automated payments, investment options (CDS, money market, like that) at good rates with advice on which to use for what, auto buying and financing advice, homebuying advice and mortgage financing.

WRT becoming a homeowner....It's probably premature to give much specific advice; just save aggressively and educate yourself. As a new homeowner myself, the thing I most want to pass on is: Try to have as much cash on hand as you can possibly manage when the time comes--as much as 25 or 30% of your expected purchase price.

I feel pretty strongly about the effects of home-made food on both physical and financial health, but I think there's been another post recently made about that which probably deserves a look before I start running my mouth. :-)

[jenett]

Ah, yes. We have a FSA, but not an HSA available. (If I could roll cash over year to year, I'd be happy to leave money in there.) I'm hoping that most of this year's costs are going to be abnormal, and I won't need to worry quite so much about hitting that $1500 middle window most years.

(It's one of those "If we're looking at 2 specialist visits and my normal physical plus the relevant blood work, that'll fit under the initial $1000 that's the school's contribution, or very close to it If it's 4 specialist visits and bloodwork, then not so much" thing.)

If I know it's going to be the second, then having the money come out pre-tax is a definite win, but only if I can then spend it sensibly. Otherwise, it probably makes more sense to just have a savings account handy in case I do find I need it. The good news is that I should have a good idea before the next time we hit plan years. (Which we do in October, because we're a school, and it makes sense to link the insurance and related cost years to the school year.)

Feel free to go on about food - I feel the same way, but the medical stuff (which included pretty overwhelming exhaustion for a couple of months that made anything more than *very* basic feeding myself really tricky, plus a lack of appetite that made things worse) has gotten me off track. Now that I'm starting to have enough energy to do things again, I still want to find more things that are inexpensive and healthy and good for me that work well for a single person living alone who doesn't bring lunch to work.

(Work feeds me lunch: it's actually usually a very good lunch with a range of choices, but it means if I make large batches of something, I have to have them for dinner for ages and ages, which is not always so great.)

FSA

[aedifica]

For what it's worth: The way I have my FSA planned this year, there's enough money to cover my therapist visits if I keep going as often as I have been, or if I stop seeing the therapist, I'll use that money for a new pair of glasses (possibly prescription sunglasses for when I'm out biking) or else contact lenses. I don't know whether you have stackable medical goals like that, but if you do, that could work.

Re: FSA

[sara]

Hah, we had a year recently where we bought two pairs of glasses for C. and about two gallons of NyQuil, the last week in December.

But since the next year the dog ate two pairs of his glasses and I got swine flu, hey, it worked out all right. *GRIN*

[jamethiel]

Hi! Welcome! Credit unions do seem to be a far better choice over there (um... I may read up on other countries financial products for fun.)

I can help with crockpot recipes. Actually, I'm thinking about running a "cook dinner at home for a month" challenge, with inspirational recipes. What's your freezer space like? The big batches thing can be alleviated a little if you cook LOTS of big batches, then you just go to the freezer and get a different dinner every night! Another option is to talk about these things with someone who works close to you and arrange to swap dinner a couple of night a week. That's trickier as you have to like their cooking skills though.

[jenett]

My freezer space is not particularly large: it's a size smaller than most ordinary house freezers here. (I'd have to go fiddle with measurements for dimensions, though.) It holds a full size frozen pizza out to the edge of the shelf, so that's, what, maybe 15", and it's about 2.5 feet long, and about 18" high.

I have been talking with a friend about combining cooking and splitting the food, but she's been travelling quite a lot recently, and hasn't been home to cook. (We already know we have similar food tastes, and while she's got a fair number of restrictions, I a) don't and b) am not bothered by being limited by hers for this kind of food.)

I also don't own a microwave (more a 'where would I put one'? issue - the crockpot and toaster oven can be more easily stored elsewhere when not in use.) so anything frozen is ideally best reheated easily by stove top or oven, which adds an element of planning complexity.

[jamethiel]

I don't own a microwave either. I'll keep "easily reheated on the stove" in mind as a criteria!

[futrstyl]

I would recommend a Mazda. I have a Madza 3 which i <3 <3 <3 <3 <3 <3 <3 <3 <3 <3 <3 <3 <3 <3

I was a former, very unhappy Saturn owner, and dumping that piece of crap for the Mazda was one of the best decisions I ever made.

[ekaterinn]

I have a Mazda 3 too - just bought it two months ago! I love it!

[beatrice_otter]

I have a 2002 Kia Rio, purchased in 2004, with which I am very happy. My parents' mechanic suggested that make and model when I asked him for advice on an inexpensive, low-maintenance, low-gas-mileage car.

I would definitely go with a used car that's only a couple of years old. With new cars there's too much of a value drop when you drive it off the lot.

[ekaterinn]

Another Mazda 3 owner chiming in! I ended up having to buy a newish car (two years old) this winter because my sister needed a car and gave her mine. So far I love my Mazda 3 - it's compact and zippy, and seems to run very well. One thing you might want to look into or buying a car is Enterprise Used Car Sales: http://www.enterprisecarsales.com/carsales/usedCarFinder.do

That's where I got mine - the prices are reasonable and SET - no haggling. Also, a remarkable lack of pressure: when I first went into their dealership, I talked to one of the salespersons about 5 cars, test-drove 3, and when I said I wanted to do more research, he just nodded and said he hoped it would see me soon.

Finally, I love my credit union. It's my local university and I've been a member there since I was a student. They gave me a decent rate for my car loan, set it up so the payments will come directly out of my checking and have generally been helpful and NOT EVIL with everything.

[jenett]

I drove the Mazda 3 as a rental a few years ago while my car was being repaired - I did like it. The plug for getting a former rental is also *really* helpful: I'd been thinking about it, but don't think I know anyone who's done that. It's really good to know it was low-pressure and no haggling. (One of the reasons I liked Saturn.)

[ekaterinn]

I can't say enough nice things about Enterprise - I was frankly terrified of buying a car on my own - but everything was really easy and no-pressure with them. They also have a 7-day repurchase agreement in which you can return the car within a week and get all your money back, minus $200 for a documentation fee.

[holyschist]

I'm in the process of switching to a credit union right now--I had set up the accounts last year, but only had the mental energy now to do the switching. It hasn't been so bad, aside from me being an idiot and not correctly checking the limit on the new credit card before trying to transfer the balance!

Not all credit unions are created equal--many are way, way better than banks, some are not. But the actual switch process has been really easy: set up credit union accounts, wait for all pending transactions and checks to clear with bank, close bank accounts, deposit money in credit union accounts. If you're transferring a credit card balance, the credit union will give you special checks to use--you just write the check to the bank for the full balance and a few days later it shows up on the credit union cc (just be sure, unlike me, that the balance is smaller than the credit limit).

I wish I had an idea on how to change automatic payments without tearing hair out, but I'm in process right now and it's ANNOYING. But that aside, I am feeling really good about the switch! The credit union has astronomically better interest rates, fewer and smaller fees, and better customer service (the bank blatantly did not give a shit about me as a customer, since I am not rich). Also, they were the ONLY financial institution who would give me a car loan, even with a cosigner, so <3 to them.

[holyschist]

Actually, the one thing I'd add about automatic payments: find out when you set up your accounts what account number to use for payments from your checking account. It may not be the one on the check (or on your statement).