Savings

Learning from New Barriers

I’ve been lucky when it comes to savings and investing. Lucky and without barriers. I didn’t realize how lucky until recently.

I’ve always been a saver. I’ve had role models in saving and frugality. I’ve also had incredible motivation. In high school, I only worked during the summer. I had to make my money last!

I opened my first savings account when I was very young. I stashed away any dollars I got my hands on, so the minimum opening balance was never a problem. Most banks are lenient with minimum balances for youngsters anyways.

After a few summers of working, I started my first investment account. The $3000 minimum wasn’t a problem. I was so good at making my money last through the years that it piled up. I had the cash sitting in my savings account. At least this would allow it to grow.

When I started my IRA, I was consolidating bank accounts. One happened to have exactly $5500. I had no other plans for the money. An IRA felt like destiny.

My 401k didn’t offer any barriers to entry either. I could put in 1% of my salary. I was just starting my student loan destruction journey and I wanted as much as possible going to my loans. 1% was the minimum I could invest without unenrolling from my 401k. Unenrolling felt like a barrier, so I did what I could to avoid it.

Now that is all well and good. I’m 30 and I’ve planted several solid investment seeds. Each of these accounts are easy now. I add to them when I want with an amount I want.

Starting my taxable investment account has been a different story.

We bought a house and that’s priority #1. It needs work. We knew that. I knew that. Taking care of the things we need to do has been expensive, much more expensive that I could have anticipated pre-move.

With that said, I don’t want to get behind on my goals. I’ve set and accomplished a major money goal each year for the last few years. Opening a taxable account is the next step. I don’t want to put it off. However, having nearly all of our money going to house projects has left little for investing.

I want to stay with Vanguard. $3000 is the minimum for most of their funds. I can’t come up with that right now. I’m staying true to my priorities, and there isn’t $3000 to spare after everything else. I lowered my hope to $1000.

I’m struggling to come up with $1000. My saving plan has me getting there in August. That’s what I’m comfortable setting aside. I don’t have the time, energy or resources (still no internet!) to hustle right now. That’s all I can spare.

I’ve never felt a barrier to saving or investing like this before. Most of it is artificially imposed, but I’m true to the jobs I’ve given my money. This isn’t an emergency. It is not a car. It is nothing I’d attempt to justify for the travel fund.

But what if this scarcity was reality?

What if the emergency fund was my rent money? My travel fund was all I had to buy groceries and my car fund had to cover gas until next payday? I can’t set aside any of that money because I need it. I can’t make it unavailable because it is my lifeline until the next payday.

I hate to admit that I’ve never really understood Dave Ramsey’s 1st Baby Step. Whenever someone calls into the show and says they are on BS 1, I didn’t get it. Really, it takes you awhile to set aside $1000? Stop going out to eat! Put down the Starbucks!

Until now, I’ve been blinded by my own privilege to never know what it feels like for it to take a few months to come up with $1000. This whole process of evaluating where I can squeeze out a few extra dollars has been a lesson in empathy.

I may not get it yet, but I’m a few steps closer to understanding.

Limited Unchanged

Yesterday, the IRS announced that the 401(k) contribution limit is staying put at $18,000. Earlier, they released that the IRA limit isn’t changing either. The 2017 limits are set.

I found out when my co-worker sent out an email (she works with benefits) alerting us. She threw in the offhand comment, “like that will ever happen” along with the new limits. I got a good chuckle from that.

I’m right here! Can’t you feel the savings?

Maggie could feel it.

After the chuckle, the reality of an unchanged goal amount started to sink in. The only emotion that came through was… Oh thank God!

It wasn’t until this point that I realized that I might be pushing too much to save.

I was striving to pay off my loans.

I immediately transitioned to plowing all that cash into saving for a house.

While doing that, I reach reach reached to get to Super Max.

For our little family, 2 401ks and 2 IRAs has been a lot to contribute so soon. Today, we are set to reach that. We have been for a few months.*

I’m so proud of us that we’ve gone from buckets of debt to Super Max in 3 years. Now that we’re maxing, I want to continue to max from now until forever more.

Having just reached this accomplishment, the thought of having to reach just a little bit further to a higher max as soon as January was an obstacle I was not ready to conquer just yet.

I want to settle in to our cash flow and I’m thankful that we’ll be able to do that.

* Due to Hubs’ late start to maxing this year, his per check contribution is more than what he’ll need to max, but he won’t max this year. Next year 🙂

September 2016 Update

september-update-2016

I’ve been waiting for this month for a long time. For my golden birthday, for my 30s to officially start, for my student loans to originally be paid off. If there was a month of my life that I’ve given too much credence to, it would be this month. There was a lot of hype.

Like nearly all hype, September couldn’t live up to my unrealistic expectations. I’m sorry, September. Actually, I should be apologizing to myself. I put so much pressure on 30 being everything more than another year and much more than just another birthday. I’m not sure what I expected it to be. Maybe I’ve seen too many movies. But I kept asking myself, “Is this all there is?”

My existential crisis turned into real depression. The thoughts started in early summer and robbed the joy from my life through my birthday. I shared a glimpse of it here when Hubs broke his phone. I pulled away from friends, family and life. I cried all the time. I stopped writing for the most part because my creative valve was shut off. I couldn’t even enjoy money. I love money!!, but it was hard to enjoy anything. I hate to blame it all on my birthday, but I’m going to.

Screw you 30.

The haze has lifted slightly, as I write this in early October. I’ve got an appointment with a professional in a few days to see how things are.

All this to say, Depression sucks and 30 means nothing.

Now back to the regularly scheduled programming.

[Flashback!]

September 2015: Hubs & I combined finances! Woo Adulthood! For the first time, I summed all of my investments and it changed my perspective on investing. I had 30k! That was on its way to being a lot!

September 2014: I started the month in Scotland (that beautiful country). I had $25,485 in student loans remaining. With this wonderful community’s support, I came out to Hubs as a blogger. I can’t believe I kept this from his for so long. To this day, no one else knows. {this is still true.}

September 2013: A whole lot of nothing. I turned 27 and had a law degree with no job to show for it. The dark depression days were starting. It was a bad time.

September 2016: 
screen-shot-2016-10-04-at-7-53-10-am

Assets!

Retirement: $47,784 (+2,003) This is all on auto pilot. So much so, that it doesn’t feel like my effort. That’s good though. These dollars can go forth and make me money while I tend to the other things in life. 

The big news here is my 401k account. On September 27, I noticed I was $28 short of having $25,000 in my 401k. Even though my combined retirement balances are higher, I really really wanted to get to $25,000 in my 401k, especially because I was so close. The market went up, then down, then up. It was a nail biter, but I MADE IT! I am the proud owner of $25,000 in my 401k. 

I had brief hopes that I would get to $50k by this month, but the market would have had to be fabulous to accomplish that and it wasn’t. October or November, I’ll get there. 

Taxable: $9,181 NC I’m back to waiting on this account until December. 

Auto Value: $11,469 (-150)  The depreciating asset keeps depreciating.

House Fund: $39,428 (+6,300) Hello House Fund! This surge is almost entirely due to my Grandpa money. I cashed out the whole life policy he opened for me and promptly deposited the money here. I actually had a pretty sizable taxable gain. (Well, as much as you can have for cashing out $5500 in cash value). I also took the time to calculate how much this money would be worth had it been invested in the market the whole time. I was expecting to be heartbroken, that it had been a huge waste of time and money. Nah. It annualized to just below 6%. Not bad at all!

HSA: $7,624 (+236) 2 contributions as scheduled and no medical bills. I also have $109 in a Limited Purpose FSA I have to use by the end of the year. LPFSA… never again. 

Car Fund: $828 (+50) Hubs punctured one of his tires with the longest nail I’ve ever seen. It was probably bigger than my face. I only saw pictures and not the actual nail, so that’s what I’m going to keep telling myself. The patch job was $20 and we took it out of normal cash flow. It’s going to take a lot for me to tap into this account. I’m still thinking it would be good for tires or to buy out Hubs’ car. 

Liabilities!

Car Loan: $5,330 ($377)  The progress is slow and steady here. Nothing to report. This is the minimum payment on a cheap loan.

{Overall}

Net worth: $110,984. Up $8,816 from last month. 

Thanks Gramps for the big increase! What a delightful birthday gift. Last month I celebrated $100k and here I am already over $110k! Will next month bring $120k??  Doubt it. I don’t have a money tree in the backyard and so much of this is in cash. I can’t rely on the market for much movement!

 

How was your September? Do you have any wise advice as I enter 30? Other than, of course, to not put so much freaking pressure on myself?