Travel the only thing you can spend money on that will make you richer. So how do you travel when money is tight? Before getting married, I had a money envelope where I would set aside $50.00-$100.00 per check specifically for travel goals. I started the habit when the Mr. decided he wanted to celebrate his 30th birthday in Germany. Saving for that trip got me into the habit of making travel a priority. Germany was actually our first time traveling together….EVER. We stayed there a few days and then road tripped our way to Prague, in the Czech Republic with his best friends where we rang in his 30th birthday! Wow, that seems like so long ago. After that, I kept saving so that when it was time for another trip, I already had money saved. When we got married, I stopped saving for travel and put that money toward saving for a wedding. I guess I never picked back up the habit of saving for travel. That ends now!
The goal is to travel not to escape life, but for life not to escape us. According to a survey from by the U.S. Travel Association’s Project Time Off, 55% of Americans did not take all of their vacation days leaving approximately 658 million unused vacation days on the table. Taking time for yourself is a very important form of self-care which is why I have created this list of vacation ideas that every millennial woman should strive to take this year. As you sit in cubicle nation or look out of your office window and picture yourself on a sandy beach with a frose’ in hand, just think that this can all be a reality. Even you don’t get a lot of vacation time (raise your hand if you have been there) you can monopolize on 3 day holiday weekends to make your days stretch.
The Girl’s Trip
The Road Trip
The Couple’s Trip
The Solo Trip
Buying a car can be a stressful process with so much to think about. Are you getting the best deal? How much car can I afford? Does it come with a rear view camera? For the first time ever, I am looking to buy a car from a dealership and I am not in a position to buy the car outright. I have never had a car note before and the idea of an additional monthly expense gives me anxiety. So how does one make such a large purchase with confidence? The answer is going into it well informed so that you don’t get hustled by the vision of you riding off into the sunset with sexy new wheels or hustled by a salesperson trying to make their quota. Over the next few weeks, I will break down everything need to consider before buying a car. Today, we will focus on two of my favorite starting points- New vs. Used and Down Payments. So buckle up and join me on this car-buying excursion.
The New New
There is this character in the 2006 movie ATL whose nickname was “New New”. New New got her name because she was known to have the latest and greatest of everything. If she were looking for a car in the year 2017, she would be considering a 2018 because the 17 model just wasn’t new enough for her. Even though New New is a character in a movie, many people out there share the same mindset. The thing is she places her money in items that depreciate in value at an accelerated rate. In fact, just by driving your new car for the first time as a new owner decreases its value by 11%. The $30,000 car you just drove off the lot is now worth $26,700 by the time you get to the highway. Instead, consider a used car that is between two and three years old. They are often still under warranty, they offer many of the same features, and comes with a lower price point.
Cash Is Queen
I understand that most people cannot afford to pay cash for a car. I did it by dealing directly with private sellers on Craigslist, buying older models, and going into the process with a set amount to spend. It worked for me and I did it at a time when the cars on Craigslist were good deals for both buyers and private sellers. I am a regular person who found a way to make the money work for me. Financial guru, Dave Ramsey, reflects on people who give him push back that regular people cannot afford to pay cash for a car in his book Complete Guide to Money (a must read, click the here for a FREE download with the app). According to Ramsey, “people don’t buy with cash because they are rich; they’re rich because they buy cars with cash”. I must agree with his statement. I am in a better financial position today because I decided I couldn’t afford to have a monthly car note.
Assuming you can’t buy the entire car with cash, consider how much you can pay for up front to keep the overall price of the car as low as possible. Whenever you finance a car, you are paying interest on that auto loan. Instead of financing the entire amount, you should aim to have 20% or more as a down payment to avoid wasting thousands of your hard-earned money on interest. Additionally, taxes and extra fees should not be considered when calculating your 20% down payment because you should NEVER finance taxes and fees. Before you even set foot in a car dealership you need to ask yourself, can you actually afford the car you have been researching? Rich people ask “how much?” Broke people ask “how much down and how much per month?” A salesperson will tell you the lowest down payment to get you to sign on the dotted line but going into negotiations well equipped with the knowledge of best down payment to make, you know you can do better…and if you can’t, that means you cannot afford that car. Ramsey explains, “When a rich person says she can afford it, she means she can actually afford the car. When a broke person says she can afford it, she means she can probably make the monthly payments as long as there are no emergencies and she doesn’t lose her job”. Think about it, could you afford your monthly car payment if you were out of work for a month? How about 3 months? These are all things to think about before you buy a car. Stay tuned next week for Part II as we discuss Every Thing You Need to Know About Leasing and Financing a Car!
Rapper Notorious B.I.G. wasn’t lying when he said “mo money, mo problems”. That because of something called Lifestyle Inflation where your “lifestyle” needs increase as your income increases; thus, keeping you in the same financial situation. This reality creeps up when people have debt, don’t save, don’t invest. They don’t keep up with the Joneses, they are the Joneses. By no means do I believe that one doesn’t deserve nice things. In fact, I believe no one should have to sacrifice a quality lifestyle because of lack of resources. A quality lifestyle comes at a price but let’s try to not dig ourselves into a money pit to experience the finer things in life.
CONFESSION OF A LIFESTYLE INFLATING MILLENNIAL
I remember being at my job out of college and making around an entry level salary. I owned my car outright, had my student loans paid a year in advance, and was on my way to buying my first house. Back then, you couldn’t tell me I wasn’t living a rich life. I wasn’t rich from a financial standpoint but it was the first time where I was “adulting” and was able to fund my lifestyle by myself. This was a big deal considering a year and a half before that, I was a senior at Spelman College eating pizza at 1:00 am while pulling all-nighters. As time passed, income changed, and lifestyle needs matured, I found myself “needing” more. I had to get another car after mine was totaled in an accident but I couldn’t bear the idea of not driving a luxury German car (thanks Dad for that addiction). I spent money on home decor so I could have a “magazine ready” home. I upgraded my wardrobe. I was making a little money and working with people whose hourly rate was a luxury car note. I wanted to show my family and friends that I had it all together….that I belonged in my new life. That all changed when I left a promising career in one field to follow other dreams for another field. It was in the transition that I started to place a serious effort in saving money and making smarter financial moves. I had to. It was my new reality, we were in a recession, and I was no longer constantly surrounded by the Joneses. I took the time to invest in my own financial literacy so I could better understand how to stretch my money. This was also around the time she makes cents was born.
BALLIN’ & BROKE
As you vibrate higher so will your expectations of people, experiences, and things around you. The good thing is there are ways around lifestyle inflation where you can enhance your life without feeling broke. Lifestyle inflation keeps you in a constant state of financial paralysis because your need for “things” is keeping pace with your increasing lifestyle. That’s how a millennial couple with no kids can feel financially stretched in a $100,000+ income household. Stay tuned as we dive deeper into the topics of lifestyle inflating from a millennial perspective and explore opportunities to elevate your life without the elevated price tag.
Six years ago shemakescents started as a way for me to share my financial journey with the world… and by that I mean my dad and my cousin Dot because they were the only two people reading my stuff in the early days. I kept writing because I wanted to share my story and connect with others. I knew my financial journey felt different from my other twenty-something friends because they would come to me with their questions about buying a house and how to get ahead of student loan debt during a recession. Soon, other people joined my dad and cousin in subscribing to the blog and that was the first time I really felt like I wasn’t talking to myself. In the past 6 years, I have been so surprised by the people who take a moment out of their busy day to tell me how much they enjoy reading shemakescents. You have been with me when I paid off my credit card, bought a car off Craigslist and got married. To the 1.3 MILLION visitors to she makes cents…. thank you for joining me for the past 6 years. Stay tuned, 2017 has the potential to be our best year yet!
I know Monday’s can come with a bit of eek to them. It represents the end of the leisurely weekend where brunch rules supreme and making time for the things you want to do becomes a priority (#WeekendGoals). Now it is back to reality and time to prioritize all the things that need to happen to help you be successful throughout the week. I want you to think about this quote. “You are always one decision away from a totally different life”. The decisions you make, good or bad, big or small, can have a major impact on the direction your life takes. I once made the small decision to go see my little sister dance in a recital and I met my husband. I have a friend who was unhappy with her job but loved her career. She made the decision to apply to three jobs in three weeks and she now has a signed offer at another company with better benefits and a better salary. Since following through on a decision requires action you need to think about what actions you make today that will align with your money, career, or lifestyle goals for tomorrow.
As an avid reader of the Cosmo, I have been a fan of Joanna Coles, former Editor-In-Chief, since her early days of at the magazine. She expanded the content to career advice, finances, and other less traditional “Cosmo” topics making it my all around go to along with Forbes and Inc. That’s right, I am a Cosmo girl. My fan girl experience, with regards to Joanna, went to a level 10 when she liked and retweeted something I wrote back in 2014 about rock star women in business. I felt like that was a small example of how supportive she is of women and their careers. She is one of my celebrity mentors (in my mind) that I actually have never met but learn so much from.
Career Advice from Joanna Coles
While watching episode 1 of So Cosmo, Joanna imparted her wisdom on a group of unsuspecting millennials visiting the Cosmo office. During an introduction exchange between Joanna and the group, one woman introduced herself by her first name only. Joanna explains, “First rule of Joanne Coles, women in particular should always say both names [when introducing their selves]. Women always go, hi, I’m Julie. You have to go hi, I’m Julie Thompson. Men never ever worry about doing that.” She further goes on to explain her rationale behind the “first rule of Joanna Coles” to relationship expert, Matthew Hussey, who overheard the exchange between Coles and the millennials. “It is very important. It’s my signature thing. Cause you think of yourself as Matthew Hussey, but if you were a girl you would just think of yourself as Matthew.”
Hello, I am….
In that moment, I replayed several instances when I introduced myself to clients as simply Danielle when my male counterpart would introduce himself first name last name. While doing a little research about introductions, I found that when people properly introduce themselves by first name last name, the other people is more likely to rememer you and your name. Remember my whole, Hi nice to meet you, I forgot your name already phase?? Perhaps this would have helped everyone back then. What I like about the “first rule of Joanna Coles”, is the expression of assertiveness and dominance in the first introduction. It’s like “leaning in” before anyone has even had time to make any judgements, good, bad, or indifferent, and letting them know you are a boss chick in the room. If this is the first rule of Joanna Coles, I can’t wait to see what else I learn from my celebrity mentor.
Hello Lovelies and welcome to Super Bowl weekend. This folks, is a big deal for everyone from my hometown of Atlanta! Since it is Super Bowl weekend, I will break down today’s money inspiration for you in sports terms. I want to inspire you to check your financial plan. Is it current? Does it reflect your current financial status and goals (gosh, the last time I posted mine was in 2013)? If you’ve never created a financial plan that’s okay too because today is a great time to do so. Your financial plan is like your game playbook. Your money is the football and it is your job to block anything that gets in your way of getting to you getting to your goal. To do so, you have to reference your financial playbook from time to time. There will be setbacks (see How to Comeback from a Setback), people who will attempt to block your progress, and times you may have to go out of bounds. Trust me, you can win at this debt game! Let’s turn your Xs and Os to dollar signs. The weekly habit of saving money with the She Makes Cents 52 Week BINGO Money Challenge will always be a part of my financial plan. I saved $108.00 dollars for the month of January and today I have crossed off $21.00 putting me at a YTD of $129.00. I can’t wait to see how many thousands of dollars I save again this year. So many of you shared with me that your savings will be going toward vacations and paying down debt. Let’s make sure that you have also included this money challenge into your financial plan so we can see your savings increase and your money challenge rewards materialize. Everyone have a fantastic weekend and Atlanta Rise Up!
Last year, one of my girlfriends and I decided that we were going to pay off our credit cards at the same time. I was paying down debt to start my snowball and get me one step closer to Dave Ramsey’s Baby Step Three. She was knocking down her revolving debt before she purchased her first home. In the process of us paying down our credit cards, we were both offered limit increases from our perspective credit card companies. I accepted the increase and she declined. Her rationale to decline was that she was trying to get rid of her monthly credit card payments because a limit increase would only entice her to spend. For me, accepting the almost $5,000.00 increase meant that I was lowering my debt to credit ratio.
What is A Debt to Credit Ratio?
A debt to credit ratio or a credit utilization ratio is just as it sounds….It’s the ratio of how much money you owe a particular debt as compared to the credit limit. If you have $4,000.00 balance on $10,000.00 credit limit, your debt represents 40% of your credit limit. The lower the ratio or percentage the better impact one’s credit score.
How The Debt to Credit Ratio Affects Your Credit Score
Outside of your payment history, your “amount owed” or debt to credit ratio, is the second highest factor in calculating an estimated 30% your credit score. Keep your balance under the 30% mark and you stay on the lower side of the debt to credit ratio, which is where most personal finance gurus would urge you to stay if you have to carry a balance.
At the same time that my credit card limit jumped up $5,000.00, my balance was quickly decreasing and I had a credit score of 786. The next month it moved up six points and stayed that way for three months. In July, the month I paid off my credit card, it jumped to 806 for about two months. I started using my credit card just a little bit carrying a small balance and it went back down to an 800 for about three months. I was on a high when I saw my score increasing so to see the decrease was disappointing…even if it was only a 6 point drop. I vowed then to do whatever I could to not let my credit card balance roll over to the next month ever again. I am happy to report that I currently have an 810 credit score. Moral of the story… lower your debt to credit ratio and it will have a positive impact on your credit score. You can do this by making on time payments to lower your debt balances and if you are offered a limit increase, take it only if you can continue to be responsible with your financial goals.
Hello #SMCmoneytribe and welcome to the weekend! We are a month into the challenge with almost 50% more participants than the previous year. Great job everyonet ladies!!! That says to me, they there are people out there making smarter money moves in 2017. What made this year different for me was including the Mr. so we can double the money from this challenge. Full disclosure…. the Mr. decided it was easier for him to remember if he just set a fixed amount of $50.00 per week to the challenge. It makes it easier for him and I like it because even if I cross off a lower amount, I have the $50.00 to add to it.
Show Me the Money!!!
Week one was all about learning how to win at the She Makes Cents BINGO Money Challenge. For week two, the focus was inspiring you to stay motivated toward your savings goals. It is easy to keep your eyes on the prize in the beginning of the year, also know as Resolutions Season, but getting through 52 weeks is only hard if you lose motivation. Week three, the country paused to witness the transition of presidential power and we did too. Before I knew it, we successfully completed month one of the money challenge. Below is the financial breakdown for the month of January.
How to Join the Challenge
Want to join the #SMCmoneytribe to get access to a tribe of goal minded accountability partners who are invested in your success and your FREE bingo money guide? Click here, fill in your info, and we will do the rest.