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Sunday, February 28

Hello, Freedom

Back in August when I unexpectedly lost my job of 6+ years, there were days when the future was bleak. This time, all I see are sunny skies.

Of course I would be better off financially if I was still earning a paycheck. I went out with the CFO of my former employer a couple weeks ago and he made a good point: losing my job might be a good thing because it frees me up to do what I've always dreamed of doing, which is to start my own business.

I've dabbled in self-employment since I was eight years old and operated a candy store out of my bedroom closet. I like knowing my fate is entirely in my hands.

So... my plan is to get serious about deciding whether to move to Tampa. My partner and I have had preliminary discussions about starting a high-end landscaping business. Now is the time to decide whether we plow ahead or find an alternative.

Financially speaking, I will be fine. I'm earning enough from mystery shopping to cover my mortgage and then some. The rental houses are throwing off a decent amount of cash as well. I've made a nice dent in my credit card debt since the start of the year. All in all, things are okay.

Friday, February 26

Goodbye, Job

Today is my last day at my job. That makes this 3 month stint the shortest time I've ever held a job (well, except for the little pizza joint I worked at for 3 days when I was 18). I knew early on that this job wasn't for me, and my boss and I had a long discussion last week about it. We disagree on "why" things didn't work out, but we both agree it isn't working out.

This is selfish to admit, but the only reason I did not quit sooner is because it was an easy paycheck. I wasn't making much, but I basically drove around all day the last few weeks "cold calling." That's where my boss and I disagree. I consider the service I am selling a "complex sale" aka one built on establishing credibility, building trust and creating a moat around what normally is a commodity (computer support). My boss, who has never been in sales, thought I would be able to bring in new business by doing door-to-door, unannounced and without doing any homework, asking to speak with "the owner".

I consider myself a decent salesperson because I trained under a super mentor. At this job, I just wasn't given the flexibility to do things the way I was taught. This isn't the end of the world. Since I've been expecting this, I am financially prepared. More about that later...

Wednesday, February 24

My Frugal Miser - Joining Weight Watchers

One of my 5 goals for 2010 is to lose 26 pounds. Now that I am planning a cruise, I have even more motivation to shed some fat. By the middle of February I had made zero progress, so I decided last week to sign up with Weight Watchers.

I absolutely hate recurring costs, but I decided this was an investment in my health and will probably save me money over the long term in better health if I achieve results. My energy level has been so low in the last few months, and many of my clothes have gotten so tight that after eating I need to unbutton my pants or risk exploding.

I won't be anywhere near my desired weight by the time we leave for our cruise (May 22nd), but my goal in the next 90 days is to lose 25 pounds. Aggressive but achievable.

Monday, February 22

Planning a Frugal Cruise

I’ve said many times that being a miser doesn’t mean living a miserable life. Personally, I no longer feel any excitement from the acquisition of material things. I have everything I need and have no desire to bring new clutter into my life – only the absolute necessities are welcomed into my home. What I do get excited about is having experiences. Still, the frugal miser in me aims to eke out the most "experience" my dollar can buy.

The last time I went on a cruise was to celebrate my graduation from college. Three of us agreed to share a room on this 7 day adventure. It was my first time to visit another country besides Canada and also the first time in a long time to be technologically detached from society. I could have used my mobile phone or the Internet cafĂ© on the ship, but the cost was prohibitive. There’s something to say about getting away for an entire week without contact with the rest of the world. Under these circumstances you can truly relax.

On May 22nd, my partner and I will cruise the Western Caribbean for 5 days. My goal is to keep the total cost of this adventure under $1,000. I paid $775 for the cruise itself, which doesn’t leave me much for anything else. I selected the absolute cheapest cabin available, which was an interior room with bunk beds instead of two standard twin-size beds. I can’t see us spending much time in our room, but even if we do the room is 160 square feet (plenty space for me) and includes satellite TV, a luxury I don’t have at home.

One side benefit: I paid for the cruise with my Discover Card, which is offering 5% cash back on cruises through March. That’s just shy of $40, which I will probably redeem for a restaurant gift card.

So, how do I plan to spend $225 or less on food, travel, souvenirs, and excursions?

  • I plan to earn a free flight credit by dedicating all purchases to my Southwest VISA credit card and converting all my Hilton Honors points to Southwest credits. I am 12 credits shy of a free flight but can earn 6 credits by converting my Hilton Honors points. I also should receive 2 credits from my current statement on my credit card. That leaves 4 credits left to earn, which is $4,800 if I earn them by using my VISA. I may buy some gift cards or prepay something (maybe Homeowner’s Insurance?) to get these credits.
  • I I earned a Companion Pass last year (I was quite the frequent flyer at my last job), so my partner flies for free with me.
  • If we fly into Tampa (our cruise departs from there) a day early, I will book a free room with Best Western.
  • Of course, food on the ship is included. For food en route to/from Tampa, I will have a couple of gift cards.
Essentially, I should have about $200 to use onboard the ship or during our excursions. On my last cruise we booked our excursions directly as the cruise line significantly marks up the excursions booked directly through it.

Is spending $1,000 for a week’s vacation frugal? Well, I could certainly spend less than that for a trip to the beach. Instead, I would rather splurge a little. Otherwise, what’s the point of living? Besides, this gives me the chance to embark on a new adventure: I have roughly 90 days where I can try to squeeze some expenses or juice some new income to cover the cost of the vacation.

Friday, February 19

An inspiring blog: The Spartan Student

Every so often I bump into a blog that makes me salivate with envy. The Spartan Student is my most recent find. Written by Ken Ilgunas, a graduate student at Duke University, it follows Ken’s experience living in a van on campus so that he can graduate debt-free.

For the Cliffs Notes version of his blog, Ken published an article that can be found on

“I pledged that I wouldn't take out loans. Nor would I accept money from anybody, especially my mother, who, appalled by my experiment, offered to rent me an apartment each time I called home. My heat would be a sleeping bag; my air conditioning, an open window. I'd shower at the gym, eat the bare minimum and find a job to pay tuition. And -- for fear of being caught -- I wouldn't tell anybody.”

What I find most fascinating about this blog are Ken’s explanations for how he copes with year-round van-dwelling:

  • · He cooks using a small propane device and never washes dishes (disgusting, I thought, but he claims it’s never made him sick). He brings water back to the van each night for cooking and consumption.
  • · He screwed hooks into the walls of the van to hang his clothes so they wouldn’t wrinkle.
  • · For entertainment he’s found an empty classroom that’s never locked where he can watch TV or movies at night. He also spends a lot of time in the library.

Ken is a fan of Henry David Thoreau’s Walden, and his 1994 Ford Econoline van is his own version of a small cabin in the woods. I’ve contemplated having my own Walden many times. I haven’t taken the plunge yet, but reading about people like Ken make me itch with envy at the simplicity of their lives.

Wednesday, February 17

Mini Goal: Paying off the Amex and Citi Pro Card

I don't think my previous mini goals were aggressive enough since I handily beat them ahead of schedule. So this time I'm giving myself a real challenge: pay both the American Express (balance: $5,908) and Citibank Professional Card (balance: $3,333) by March 31st. Usually paying $9,000 in debt in 6 weeks would be impossible for me, but as long as I receive my tax refund on time, this is doable.

It feels so good to tackle this debt, especially since I am about to lose/quit my job and want to shore up my balance sheet FAST. I'm really focusing on restricting my spending and increasing my side income. For example, I've been aggressively going after mystery shopping assignments - I can't remember the last time I had a whole day for myself without doing some kind of work! I also reduced some of my recurring fees (Internet and mobile service) and am being extra careful about spending money on food and gas, my two largest variable expenses.

Monday, February 15

My Frugal Miser Files His 2009 Taxes

I wrapped up my 2009 taxes last week. I've been using TurboTax for the last few years and find it's much easier to keep using it year after year since it has an easy year over year comparison tool which I use to spot variances, which could mean I've made a mistake.

I spent about 75 hours this year and just my federal return was 80 pages long. I assume my taxes are somewhat more complicated than average because of my rental properties and mystery shopping.

I am getting a federal refund of just over $6,000. This is great, even though it represents an interest-free loan to Uncle Sam. My tax liability this year and for the foreseeable future will be negligible since I'm not longer at my cush job.

Unfortunately, the day after I filed I received a 1099 that I hadn't even thought about. Now I will have to file an amended return. I wonder if I will still get my refund or if this oversight will cause a delay.

80 pages. That's just crazy! I refuse to pay someone to prepare my taxes. I'm definitely in favor of simplification of our tax code.

Wednesday, February 10

Debt Update

More good news! The debt snowball is accumulating. A couple weeks ago I reported that I had paid off my Discover card. My next goal was to pay off the Prosper loan by March 15th.

Thanks to aggressive cost containment, I paid off the Prosper loan even faster. I am proud to announce that loan is now paid.

Next up: the American Express bill. At just under $6,000, it's the largest debt I've tackled. With a hefty 17% interest rate, I'm extremely motivated to pay this off. Every dollar I'm not paying in interest is a dollar I can invest towards my future.

I can have this card paid off in 4-5 months if I focus. If the stars align, I might do it faster. It's looking like I'll be receiving a significant tax refund which I could use here.

Monday, February 8

Miserly Cost Cutting

The faster I pay my debt the faster I can enjoy financial freedom. If that entails short term sacrifice, so be it. In January I reduced two recurring expenses: mobile phone service and Internet.
  1. I cut my mobile phone service to the lowest plan available through AT&T. I reduced my free monthly minutes from 700 to 550, saving $10 per month. Even though my partner and I are on a family plan, this should be enough minutes. I have "rollover minutes" so that should help, too.
  2. I also lowered my DSL from 6MB to 768kB. This reduced my monthly bill from $47.95 to $19.95. The only reason I had not done this sooner is because I stream a lot of movies from Netflix, which accounts for almost 100% of my entertainment expense. I did buy a new antennae for my TV for $20 which picks up twice the channels as the broken one I had been using.

I'll see whether this slower speed is adequate for streaming movies. I have my doubts (it just went into effect so I haven't tried it out yet) but can easily switch back if necessary.

I doubt my job will last much longer so I want to be proactive about cutting costs now. These two cuts reduce my ongoing expenses by $37 per month... More than $400 a year!

Saturday, February 6

February Goals

During January I achieved all four of my monthly goals. I expect February to be a solid month, except that I may be unemployed once again by the end of the month.

February Goals:
  • Last month I earned $926 in mystery shopping income. Since I won't be shopping as many gas stations due to rotation requirements, my income will be less in February. I will earn $500 in mystery shopping income.
  • Last month I spent $141 on food. I will spend less than $140 on food this month.
  • Last month I spent $47 on fuel (thanks to mystery shopping). In February I will spend $175 on fuel. I have a daily commute of 90 miles which makes fuel one of my larger expenses.
  • My #1 financial priority is paying down my credit cards. By the end of February I will reduce credit card debt to below $36,000.
  • I will pay off my Prosper loan in February.

Thursday, February 4

Reviewing My January Goals

During January I did okay with my goals. This blog keeps me accountable.

January Goals vs. Actual:
  • Last month I earned $926 in mystery shopping income; my goal was $600. SURPASSED!
  • Last month I spent $141 on food (sames as last month); my goal was to spend $5 per day ($155). SURPASSED!
  • Last month I spent $47 on fuel; my goal was $175. Even better, my employer reimbursed me just over $47 for mileage, so you could say my net was zero spent this month. SURPASSED!
  • I reduced credit card debt to $38,562. My goal was $42,500. SURPASSED!
I achieved all of my January goals! I am especially happy with my spending on fuel. I drive 90 miles round trip to work each day. I cut this expense drastically by mystery shopping more than 50 gas stations in January.

Tuesday, February 2

My January Income: $8,170

January was a decent month based on a much lower salary at my new job. I have worked two full months at my new company, but I don't think I will stay much longer. I might explain later, but I try not to complain and can't think of many positive things to say about this new job.

January Income
$2,000 Full-Time Day Job
$770 Mystery Shopping*
$198 Change in Value of Retirement Accounts (Roth IRA and Rollover IRA)
$4006 Rental Income*
$6,974 Total Income for January
*note that the mystery shopping income will always vary from the monthly summary amounts I post. Here I report actual payments received (cash basis accounting) whereas my monthly mystery shopping update I report the amount I earned for that month. Rental income was closer to "normal" this month.

Special/One-Time Income in January
$1,000 sold several airline vouchers
$75 participated in a focus group
$121 received a Black Friday bonus for opening a checking account with ING
$1,196 Special/One-Time Income in January

Currently all 7 of my rental properties are occupied. I don't expect to have to deal with any vacancies at least until April.

Monday, February 1

A Month in the Life of a Mystery Shopper

I exceeded my January goal of earning $600 in mystery shopping income. In fact, I earned $925.71 in fees and $530.46 in reimbursements last month. This is on top of income from my full-time job, so I'm really happy with this.

More than 1/3 of my income was from gas stations this month. I shopped over 50 gas stations in January. Unfortunately, this means February will be much lighter because the company I do these for shops in 2 month rotations (in other words, I basically do these particular stations every other month). The second largest contributor came from merchandising. The balance came from restaurants, office supply stores and a few other oddball shops.