Tuesday, December 23, 2014

Financial Update...part 2

I promise....part 3....or the Year in review....or some post.....will talk about the side bar and the soon to be updated numberBut here is a continuation of part 1 from last week.....


The Boat

G-man sold the boat 3 weeks ago.  I hated the money sucking boat (even though it hasn't really been a financial issue for awhile).  But when the new owner was driving it away....I got sad.  The boat was purchased 6 months before G-man and I met, and I do remember the pre-kid days when we would take the boat out...he would fish, I would read.  Couple that with the major changes we have in general, and I just got overwhelmed.

We got $2000 for the boat.  Blue book was around $5000 for an excellent condition boat, and this was far from excellent.  It probably needs a few thousand in work, and time.  For the 20-something kid that bought it, who's best friend's dad is going to help him fix it up....they got an excellent deal (a trailer and a boat).

So we now have $2000 in cash......plus

Miscellaneous Money

Way earlier in the year we had saved about $2000 to make a massive snowball payment.  I just had a really hard time actually pulling the trigger, so it sat for a bit.  Then the move entered into the picture.  We used about $800 toward the getting-the-house-ready, and another $100 went to something that is escaping me right now....leaving $1100.

Add in the boat money, and we are at $3100.

Plus, we received a cash gift when G-man left his CT office.  That is another $350.

So now we are at $3450.    This is not our regular savings account.  This is not part of our EF.  This is pure "extra."

The Debate

As usual, I can't just pull the trigger on one thing with the extra money.  In some parallel universe there is a Mysti who has ONE plan and just follows it.  If I ever meet her, I will ask her how that is working out for her.

Meanwhile, in this universe, I keep running numbers....in no particular order.....

  • Pay off G-man's car.  I haven't updated the side bar yet, but G-man's car is about $3472 with the December payment.  We keep a little slush in the account, so another $20-ish dollars and the car loan is gone, freeing up $127 a month, which could go toward debt or toward living expenses while we are living in 2 households.
  • Huge snowball to Mysti's car.  My car loan is about $5100.  Add in whatever we get from our tax return, and there is a pretty good chance that by spring the loan is paid off, freeing $230 a month.  Again, go to debt.....or living expenses.  The biggest downsides to this option are that the loan has a very low interest rate so we aren't saving a huge amount there, and there is at least a few month delay before this is actually paid off....so the freeing of the money doesn't help in the short term.
  • Huge snowball to the CC.  Obviously it doesn't get rid of the debt, but it is a boost to your credit score, which has fallen a few points because of the utilization ratio.  We are still in the high 700's, but I get an icky feeling seeing it drop.  As always, the concern is that using the CC as a crutch will bring the total up again.....yes, the simple answer is don't do it.  But let's just lay the cards on the table...there is a chance this is going to happen.  I know some of you will yell at me about this, but your yelling doesn't solve the problem that is "cash flow."
  • Save it for the move.  We already know the move is going to run us in the $6500 range (between the movers, my trip to go house hunting, misc travel expenses, setting up a few home expenses, etc).  Obviously this covers about half....add in the tax return in a few months, and we should have about 3/4 covered.  We had figured at least some of our move would be charged, with the plan that we would have it as a tax write off...but that won't happen until 2016.  Whatever money we get back will go to debt in one form or another, it will just depend on what the situation looks like in 2016.
  • Living expenses.  I started writing this post before we got paid yesterday and saw our $159 check.  The idea of saving it for living expenses was sort of on the bottom of the priority because a) we really didn't think the check would be THAT low, b) concern that it would get eaten away at "nothing", and c) G-man getting a second job was always a consideration to make up for a deficit.  But now that we know that we have about $330 less per month....this would float us for 10 months.  And we already know that this move is going to happen before then (hoping for May or June!)
  • Fund the miscellaneous accounts.  I have talked many times about our on-line funds to pre save for expenses, such as car insurance and maintenance, water bill, taxes, etc. We also save for the cats, kids activities, Christmas....but right at this moment, those are secondary.  We could put aside money we know we are going to need for at least the next 6 months and not have to worry where that is going to come from.


In the short term.....it is going to sit and wait.  The next 10 days are just not the right time to make a decision, so we will mull it over.  (Although I would love to pull the trigger on 12/31 and bring out 2014 down!!!)  I am trying not to split the money into small piles, because it really doesn't help the big picture.

I really do wish we were in a situation where we could SPEND this.  But we aren't.  So this option is not an option.  But the thought was nice for the 1.3 seconds that it lasted.

Feel free to interject.  Am I missing something?



19 comments:

  1. Nice to have an infusion of money, isn't it?! My first thought was pay off G-man's car immediately and that would cut your loss of monthly income to a more reasonable amount. But then I realized - if I'm reading it correctly - you don't have enough cash to cover the move? If that's the case, it's a no-brainer. You need it for that purpose. No reason to go into more debt if you have a way to pay for it - I sure wouldn't put it on credit cards! I think you need to narrow your choices. You're going to drive yourself crazy if you are trying to decide between so many options. Pick the two most important on your list and figure out which one is THE most important. In my mind, it's the move, but I'm not in the driver's seat :) Out of curiosity, what's the status of your home sale? I guess I'm wondering what happens if you don't sell by the end of the school year? That's just me being nosey, so you may not want to answer that. At any rate, congrats on the sale of the boat. I know you'll miss it, but that's one more thing you don't have to haul in the move!

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    1. Nothing going on with house. We don't expect anything until spring. As for next steps...that is still in discussion.

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  2. Hmm.... If you don't have money for the move, where are those expenses going to go? Are they going on the CC? If so, it would be better to save the cash and pay for the move out of pocket. rather than paying down car debt.

    I'm assuming the car debt has a lower interest rate than the CC. If the CC is a huge temptation to spend it back up again, then I wouldn't do that either.

    If you can pay for the move in cash, 'd eliminate the monthly payment from Gman's car. It would give you $300 to live on after his first job. The second job would most likely give enough to pay living expenses with. I don't know how large your minimum debt payments are, though. You'd have to make sure to have enough to cover living expenses and debt payments with his two jobs before dumping the cash to pay off a loan, as good as that feels.

    That's my thinking at least.

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  3. You are so much like me. Terrified to do the wrong thing.. I am a staler when it comes to this kind of scenario. My first instinct would be to pay off the car, but moving money will be nice. Just sit on it for a few days.

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  4. I would definitely use it for living expenses and/or the move. Nothing else makes sense in your situation right now.

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  5. If moving expenses are going on a credit card, I would use the money for that.

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  6. Ohhhhh we are soooo alike. I would just sit on it, and sit ... and sit ... and sit ... lol

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  7. For what it's worth here's my two cents. I sold my house back in 2007 for a loss and had to bring $13,500 to the table after paying closing costs and the remaining balance on my mortgage. I ended up paying for most of it with a credit card at 10% interest because I had little cash to use. My suggestion is you keep the money in savings just in case you owe some when you sell which really sucks but I think you mentioned you are pretty close to the break even mark at your current list price.

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    1. That is a great point. Hopefully that won't happen to Mystical though.

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    1. And that is why there is a debate. I pay off the car...save about 750 in the next 6 months. Add that to the EF....and I am at 3750. Not far off from the 3450 I have now. But then I don't have any EF.

      If you cringe...then don't read it.

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    2. Oh wait....HELLO Lisa. Enjoy the 2 comments I posted....they will be the last.

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    3. "Lisa Parsons aka Cordy Parker aka c the writer" can't go too long without popping in to say hi.

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    4. Lisa is kind of an ass.

      I would pay off the hubby's car, though. Take care.

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  9. I don't know who Lisa is, and whether she is a financial adviser or not, but given your situation, I would entirely hold onto the money and keep it in reserves for the move and house selling.

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    1. Lisa is the blog troll who likes to criticize everything I do from money to parenting to breathing.

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  10. Mysti - check out this thread on Lisa. http://getoffmyinternets.net/forums/lifestyle-bloggers/dealing-with-money/page-53/?p2010128

    DO NOT TAKE HER FINANCIAL ADVICE - EVER. She racked up over 9k in credit card debt in less than 1 year (after already declaring bankruptcy no less)

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    1. Oh trust me...I don't. As much as she thinks that I am pathetic and has told me many times what a cautionary tale I am.....she is a trainwreck. I put my blog on moderated comments because of the level of rudeness she exhibits. So now I get to enjoy her comments all by myself before I delete them.

      Yes...she has told me how rotten I am in so many ways. I am also a terrible parent. Amazing her lack of boundaries.

      Thanks for the link...can't wait to read for the entertainment.

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