A couple months ago, my husband’s aunt got new living room furniture and offered us her old stuff.  It was 10 or 15 years old, but we liked it better than our own mis-matched pieces, so we happily accepted.  We now have a couch, chair, loveseat, and footrest – all matching!

What didn’t match was our throw pillows.  Our old couches were tan, and our pillows were shades of brown and red.  The new furniture is shades of grey and blue, so there was a lot of clashing going on:

Last fall, I bought a king size blue sheet at a thrift store to make curtains for our son’s room.  I had a lot of leftover fabric, so yesterday I spent less than an hour to whip up covers for our pillows:

Much better, I think!  The covers are as simple as can be – no zippers or buttons, I just made the back out of two overlapping pieces of fabric.  Here’s a picture that shows the back of one of them:

The best part is that they are easy to take off and wash.  And our living room looks a lot better.  Not bad for leftover fabric… I spent $6 on that sheet, and ended up with curtains and three pillow covers.

Somewhere recently I came across a quote that went something like this:

Never sacrifice what you want most for what you want right now.

This really resonated with me, as I think it can be applied to just about anything in life… money, exercise, diet, personal relationships, jobs, etc.  We all have things that are on our list of what we want most.  But we often let what we want now get in the way.  For myself, my own list of what I want most looks something like this (in no particular order):

• To always have a strong relationship with my husband and son and with our extended family and friends
• To still be active and healthy when I’m 100
• To own our home free and clear as soon as possible
• To be able to weather whatever financial storms life might send our way

Since these are my priorities, I try to make them a part of my life every day.  I spend time with my husband and son, and make sure that I keep in close contact with the rest of my family and friends.  I exercise every day, and make sure that pretty much every bite of food that passes my lips is increasing my chances of reaching that 100 year mark.  We put extra money towards our mortgage every month.  We set aside a good chunk of our income each month into various savings accounts, continuing to keep our lifestyle pretty much the way it was when we were earning very little money.  By doing these things, we’re keeping our focus on what we want most, rather than on what we might want at the moment.

Over the years, I’ve found that focusing on what we want most has become a habit.  So much so that what we want right now and what we want most are almost always the same thing.  I derive much more satisfaction from sending extra money towards our mortgage than I would from spending that money on a pair of shoes, for example.  And I much prefer an apple to a piece of cake – seriously! (that took a while… I used to have a raging sweet tooth)

The thing I love most about the little piece of wisdom at the top of the post is how it applies to anyone, no matter how different our goals might be.  One person’s strongest wish might be to become president of her company, while another person’s greatest desire might be to climb Mount Everest.  It doesn’t matter what we want… what matters is that we each know what we want, and focus on it, without letting day to day distractions and fleeting desires get in the way.

I found this quote inspiring, and I hope some of you do too.  If it inspires you to write down the things that you want most, and figure out strategies for getting them, even better!

Last month, I wrote about how my husband and I are starting the process of estate planning.  There were some great comments on that post – thanks for all your thoughts!  Although I must say, I was surprised at how unanimous the opinions were in terms of hiring a lawyer instead of using software to do it ourselves – usually my readers tend to be pretty split on issues like this.

We haven’t decided what we will ultimately do, but for now, we’re working through the process ourselves.  Just as with our taxes, we want to really understand the whole plan, rather than just hand it over to a lawyer.  The first step we took was to pay $14 for the Suze Orman protection package, which is teaching us a lot.  We’ve already used it to do my healthcare power of attorney and advance directive (still need to get it witnessed and notarized), and will do my husband’s this weekend.  That alone is worth more than the $14 we paid for the program.  We’ll go through the whole program, paying attention to the details and figuring out what questions we need to ask ourselves, and what the answers will be.  We may end up using a lawyer for the will and/or trust paperwork, but I want to understand all of the details before we show up in the law office – if we do at all.

One of the issues to which we hadn’t ever given much thought was inheritance in general.  I guess we had both just assumed we’d leave our estate to our son, but we hadn’t thought about it beyond that.  Once we started to consider it, we decided that we don’t like that idea at all.  In general, we’re both relatively opposed to the idea of people inheriting large sums of money.  Right now, our net worth isn’t much.  But it’s growing at a fairly good pace, and ten or fifteen years from now (to say nothing of fifty), it could be a considerable sum.  We have known several people who are aware that they stand to inherit large estates, and to be perfectly honest, we feel that the knowledge of the future inheritance has had a negative impact on those people.  Some even get irritated when their parents spend money, as they feel entitled to the money (?!?!)  Some don’t put much effort into saving or planning for the future, as they are simply counting on the inheritance to fund their retirements.  To each their own, but our opinion is that large inheritances are often more of a curse than a blessing.

We want to give our son the tools he’ll need to be successful in life.  We’re saving to help pay for his college education, but only $100/month, and we have no plans to fully fund his education – we want him to take an active part in that process too.   In general, we want to give our son the things that money can’t buy.  We want to teach him the value of money, and how to manage it responsibly, but we want him to earn his own money and make his own way in the world.  As soon as we had a conversation about this, it was an a-ha moment for both of us.  We didn’t want a will or trust that simply left everything to our son.

For now, our son is not even two yet.  If we both die, he’ll need a guardian, and he’s also the contingent beneficiary on our life insurance policies.  The guardian we’ve picked is just as frugal as we are, and the life insurance money would be more than enough to raise our son to adulthood and pay for college.  But what about the rest of our estate?  These are the questions we’re looking at now, and there are no easy answers.

We did take a first step earlier this week when we opened our SEP IRA accounts.  We each listed each other an our primary beneficiaries, but rather than listing our son as the secondary beneficiary, we each picked a favorite charity.  The nice thing about retirement accounts is that beneficiary designations make it very simple to transfer assets without a will.  The Vanguard forms we filled out just required us to check a box and list the charity of our choice – couldn’t have been easier.

Hopefully we’ll both live to be 110 and spend our last dime the day before we die.  But just in case, we’re working our way through this process.  I gotta say, I’ll be glad when we’re no longer pondering our mortality!

Apparently I’m a bit behind on reading personal finance blogs, because I just came across a couple of articles from February of last year.  They’re old, but make some great points and are very interesting reads.  Trent at The Simple Dollar wrote an article about how a media interviewer called him a cheapskate.  And then Him from Make Love Not Debt wrote about his thoughts on the topic.  I found both articles very interesting, along with the comments from readers.  It seems like everyone has an opinion, and two people can see another person’s frugality in very different ways.  My personal opinion – and we’re all entitled to one – is that I’d much rather hang out with Trent than Him.  I think Trent’s values are a lot more in line with my own, and from the articles I’ve read on his blog, he seems very happy with his life and choices.

But the articles brought up a deeper point than just the choices we make in our own lives and whom we choose as friends.  There was a lot of talk about judging others and self-righteousness – from both sides of the frugal – spendy spectrum.  I think that it’s somewhat natural to tend to think highly of others who are most like ourselves.  Most people tend to choose friends with whom they have a lot in common.   I would say that I’m probably the most frugal of my friends, but they’re all pretty focused on saving for a rainy day and for retirement, and none of them think less of me for shopping in thrift stores and driving an old car.

I do think of myself as frugal.  And I am happy almost 100% of the time.  For me, the connection between those two things is strong, and I believe that the simple life my husband and I have created for our family plays a large role in our happiness.  But I don’t think less of people who make different choices in terms of how they spend their money.  As long as those choices don’t impact the rest of us.  If a person chooses to spend all of their income each month (and I’m not talking about someone working for minimum wage who barely has enough for rent and food), that is none of my business.  But when I started hearing about mortgage bailouts after ARMs began to reset a couple years ago, I’ll admit to being irritated – especially when I read article after article about people who purchased houses that they could barely afford, even at the low introductory interest rate.  Bankruptcy is another example of something that drives up costs for everyone else, and it’s frustrataing when the bankruptcy is caused because a person consistently made choices to spend instead of save.  Yes, there are lots of cases where bankruptcy is caused because a person became too ill to work or suffered some sort of catastrophic circumstances, but there are also plenty of people who live paycheck to paycheck (despite having a good income) and are thus putting themselves in a situation where they have no ability to weather even the slightest financial storm.

What do you think?  Do you agree more with Trent or with Him?  Do you care about how other people choose to spend their money?  Are you more or less frugal than your friends?  Do you friends care?

I just discovered a great new blog that I’m really enjoying.  Nature Mommy is written by Deborah Schneider, and is packed full of ideas about sustainable, eco- and budget-friendly parenting.  She and her husband are prospective foster-adoptive parents, and her blog is a great read for both current and future parents.

One of her posts, second-hand vs. sustainable, really resonated with me.  Sustainable, eco-friendly living is very high on the list of priorities for my husband and me.  We work hard to minimize our impact on the planet, and we definitely fall into the second-hand camp in the debate Deborah described.  The way I see it, any time we buy something second-hand, we’re contributing to a good cause (we mostly shop at Goodwill and Habitat for Humanity thrift stores) and we’re also completely eliminating the need for new products to be manufactured for our use.  In addition, we’re able to stretch our family’s budget much farther than it would have gone if we opted to buy things new.

Another great post on Deborah’s blog is about the baby gear she’s purchased, mostly used.  Our son is 20 months old, and our family budget has changed very little since he was born.  I see so many reports that warn parents about how their costs will go up dramatically when they have a child.  And I see plenty of my own friends – some of whom do not have a lot of money – spending big bucks on matching nursery furniture, coordinated bedding sets, disposable diapers, fancy toys… I feel sad for them, especially the ones who are struggling financially.  For us, the two major expenses since having our son have been his health insurance premiums (about $100/month) and his college savings account (another $100/month).  The health insurance is absolutely essential in my opinion.  The college fund is great if you can swing it, but plenty of kids get through college on scholarships and part time jobs, and a child is not going to be ruined because his parents couldn’t afford to pay for all or part of his education (we don’t plan to pay for all of it, but $100/month for 18 years will make a dent in his tuition bills someday).  Other than those two things, we’ve spent very little on our son.  We purchased a carseat and an organic crib mattress new, pretty much everything else has come from thrift stores and hand me downs.  Our son plays with jars of spices, pots and pans, wooden spoons, and large quantities of plain wooden second-hand blocks.  His crib sheets came from a thrift store, as do all of his clothes, and his curtains were made from second-hand sheets.  My mother and I made all of his diapers from old flannel sheets, t-shirts, and fleece sweatshirts.  We have probably spent less than $100 on diapering for 20 months, and the second-hand, high-efficiency, front-loading washing machine we got last summer has cut down dramatically on how much water it takes to keep the diapers clean.

Our frugal parenting is great for our our budget, but it’s also great for the environment, as we’re not contributing to a demand for new stuff, most of which would only be used for a short time, given how quickly children grow.  If you have a minute, I recommend taking a peek at Deborah’s blog and being inspired to live a life that is easier on your wallet and our world.

My husband and I started our business in 2002, and have been growing it ever since.  The first few years were pretty rough financially.  We incurred a lot of debt, were earning very little, and basically had a life of forced frugality.  Eight years later, things are quite a bit different in terms of debt (only a mortgage) and income.  But our lifestyle has changed very little.  We still drive the same old cars (my husband’s is 20 years old, mine is 19), still buy all of our clothing and household stuff at thrift stores, still cook nearly all of our meals from scratch… We did have a big splurge in terms of entertainment a few months ago, when we signed up for Netflix – now we spend $9/month for movies.

As our income increased and our business grew stronger, we could have started spending a lot more money.  We could comfortably fit car payments and other doo dads into our monthly budget now.  The reason we don’t is because we are focused on the big picture and our long-terms goals.  Without those goals, there would be little to keep us from just spending our money as we earn it.

Our goals involve paying off our mortgage in order to be truly debt-free, saving as much as we can for retirement, and getting ourselves to a position of financial flexibility within the next 15 years or so.  By flexibility, I mean that we might not be quite to financial freedom at that point, but we’d like to be to a point where we can work less and be able to focus more of our attention on things that don’t necessarily bring in money.

Goals like that only work out if you break them into smaller steps that you can focus on regularly – otherwise, you wake up one day and realize that the 15 years have gone by and you’re still treading water.  So we’re paying extra on our mortgage every month – a concrete step.  We put 20% down on our house when we bought it last summer (thanks to the equity we had built up in our first house by paying extra on that mortgage for six years).  We got a 15 year loan with a 4.625% interest rate, and like knowing that every month, when we put additional money towards the principal, we’re cutting time off of that 15 year term.

For the retirement aspect, we’ve both been maxxing our our IRAs for a few years now (in the early years of our business, we could only afford $100/month in each account).  We also have an HSA that we’ve been contributing to since 2006.  Hopefully we’ll never need the money for medical bills and can use that account for retirement too – but it’s nice to know that the money is there (tax free) if we ever do have a medical emergency, since our health insurance deductible is $5000.

Since paying off our mortgage is a huge priority, there is very little temptation to spend our money on other stuff.  Having our IRAs, HSA, emergency fund, and our son’s 529 plan forces us to diversify and make sure that we’re working towards our other goals too, but the mortgage keeps us focused on the big picture, which is to be free of all debt.  It’s much more satisfying for us to see the balance dropping on our mortgage than to have a new pair of jeans.  Yes, the amount it’s going down each month is relatively small compared with the total balance, but over time, it adds up.

For us, big picture goals are what make frugality fun and exciting.  What keeps you frugal?  What are your big picture goals?  I’d love to hear your stories and what motivates you to make frugal choices every day.

I was walking home from the post office today when I spotted a huge dumpster out in front of a house, filled to the brim with what looked like a lot of wood and cardboard.  I had the dog on a leash and our son in the stroller, so I wasn’t in much of a position to dumpster dive at that point, but this evening I went back with my car.  I rang the doorbell and asked if I could take some of the wood; the lady said it was all going to the dump anyway, so I could have what I wanted.

I ended up with five pieces of wood, all about five feet long, 12 inches wide, and about half an inch thick.  They will be perfect for the shelves I want to build in the craftroom we’re going to make in our basement (currently the basement is unfinished, so it’s a blank slate as far as what we want down there).  Not only were they free, but I prevented the wood from ending up in the landfill.  That’s about as green as a building material can get.

There are a few nails sticking out of the boards, and some of them are a bit dirty.  But I’m planning to paint the shelves the same color as the walls, and I think they’ll end up looking great.  I also snagged a four foot section of thick wooden dowel.  I don’t have an immediate use for it, but I know that they are a bit pricey in the hardware store, and I couldn’t let it end up in the landfill.

Have you ever dumpster dived?  Did you ask permission, or just go for it?  Broad daylight or in the dark?  What did you find?  I recently borrowed this book from the library, and loved every page.  If you’re into dumpster diving or just curious, it’s a great read.

The last time I bought glasses – in 2001 – I think it cost me about $200 for the eye exam and the glasses. I only wear them when I drive or watch a movie, so they don’t get a lot of wear and tear.  But I could tell that the prescription wasn’t quite right anymore, so I spent $59 on an updated eye exam a few weeks ago.  Then I ordered my glasses online, and spent $28 for a sweet new pair of glasses with anti reflective coating and super stylish frames.  Twenty eight dollars.

I bought my glasses from Zenni Optical (and no, they aren’t paying me to write this).  My mother had tried them earlier this fall, and was very pleased with the results.  She wears bifocals, and got a new pair for $32 (compared with about $200 if she had bought them at her eye doctor’s office).  She was so happy with that pair that she decided to order another pair just for reading.  They arrived this week, but had been caught in a post office machine and smashed.  When my mother called Zenni Optical to see about a replacement pair, they offered to start making a new pair immediately, and within 24 hours she had received three emails from the company, detailing the status of her replacement order (and there is no charge for the new glasses).  So not only do they provide good glasses for rock bottom prices (as low as eight dollars a pair), but they also have great customer service.

My new glasses arrived today (not smashed!) and I love them.  At my current every-eight-years rate of replacement, the $200 that I would have spent on an exam and glasses will last me until I need bifocals of my own.

One thing to note, you’ll need to know the distance between your pupils in order to place an order online for glasses.  Eye doctors measure this distance, but often don’t write it on the prescription.  I didn’t find this out until after I had my exam, and sure enough, that space on my prescription form (listed as PD) was blank.  My husband measured it for me (the website gives detailed instructions for how to do this if you need to), and it worked out just fine.  But if you want to get an eye exam and then order your glasses online, it’s probably easiest to just ask the doctor to make sure that space is filled in on the prescription.

I’ve mentioned before that we use one credit card for pretty much all of our spending.  We get 1% cash back on the card, and it’s an easy way to keep track of our spending, since it’s all listed in one place on the statement.  Our billing cycle starts and ends around the 10th of each month.  This morning, I noticed that we’ve spent a total of $835 so far in this cycle, and we’re already 2/3 of the way through it.  And that includes plane tickets to go visit my husband’s parents in the spring ($280 for two tickets – our son will still be under two, and flying for free at that point), and $110 to have all of our locks and deadbolts changed (something we had been meaning to do ever since we moved in, but only got around to doing a few weeks ago).  That means we’ve only spent $445 on everything else so far, and we only have about another eleven days in this billing period.

Most of that money was for food and home repair stuff, with a few other random things here and there.  Basically, we’re living well below our means, and loving it.

Last night, after dinner, we sat around the living room and my husband made funny noises at the cat.  Every time he did, she would open her eyes very wide, and stick her ears straight up.  I was laughing so hard that it hurt, and our son couldn’t stop laughing either.  And it hit me – this is what it’s all about.  Having fun, laughing, enjoying my family… we really don’t need anything else.  There is nothing that I could have bought that would have given me more pleasure than just laughing with my two favorite guys.  (Ok, so I guess we did buy the cat – the adoption fee was $85 at the animal shelter, and we do have to feed her.  But she’s obviously worth it.)

Lately, I’ve been noticing more and more that I am really happy, nearly all of the time.  I don’t think it’s a coincidence that my happiness seems to have increased as we’ve been actively trying to simplify our life.  I have mentioned before that I don’t particularly like to clean.  As a result, our house was often chaotic and messy, but I brushed it off by telling myself that I was just a creative cook, or too busy to clean.  A couple months ago, I decided to change this aspect of myself.  I started by making the bed every morning.  For two months now, I’ve been making the bed as soon as we get up, every morning.  At this point, I can’t imagine not making the bed – even though I only used to make it once or twice a week.  After I got in the habit of making the bed, I decided to tackle the kitchen.  First, I decluttered in a big way.  Then I committed to cleaning up the kitchen after every meal.  I cook from scratch pretty much all the time, and used to only clean the kitchen after it got really messy.  But for the last month, I’ve been cleaning as I cook, and cleaning thoroughly after each meal.  I cannot even describe the difference this had made in the state of our kitchen, and in my own mental wellbeing.  I love walking through our house now, and seeing lots of wide open spaces and clean counters.  Just as with making the bed, I now cannot imagine leaving a mess in the kitchen after a meal.  Frugal Trenches, one of my favorite bloggers, keeps her house 5 minutes from ready.  We have a toddler, so I’m shooting for 15 minutes from ready – still a big improvement over what it used to be.

I know this post seems a bit disjointed, but I’m hoping to convey the feeling of peace and calm that I have nearly all of the time now.  We don’t even have to try to not spend money anymore, because we’ve just gotten in the habit of doing things that don’t cost money.  We don’t know what the future holds as far as our income, and by not spending the money we’re earning now, we’re giving ourselves a cushion against future lulls in our income.  And if that doesn’t happen?  Well, early retirement sounds good to me.  Living simply and frugally, combined with decluttering, organizing, and keeping our living space clean and simple has all contributed to greatly reducing the stress and worry that I used to carry around with me.

At our old house, there were two thrift stores within a 15 minute walk; now the closest thrift store is ten miles away.  I’ve mentioned that we very rarely go thrifting anymore, which has been helpful in my mission to purge the house of clutter.  These days, I only go to the thrift stores if there is something we really need.  I went a couple days ago, on a mission to find a small set of shelves to put by our back door.  We take our shoes off when we come in the house, and they end up in a big heap by the door.  I was looking for shelves that would fit into the small corner by the door and give us a neat place to put shoes.

There’s a Goodwill right next to my favorite grocery store, so I combined the two trips.  Within a few minutes in the Goodwill, I found a perfect set of shelves.  They are homemade, solid, and heavy, made of real wood.  Exactly what I was looking for, and for the bargain price of five bucks.  Since I found the shelves so quickly, I decided to browse around a bit.  I soon stumbled upon a great carry-on bag.  It was solid and well-made, with a retractable handle and wheels to roll it along miles of concourse.  It had tons of interior and exterior pockets, and was just a handsome bag overall.  I wanted it.  Up until a short time ago, I’d have bought it, simply because I wanted it.

But my new clutter-purging self decided to pass on the bag, for lots of reasons.  I already have a great backpack that works just fine as a carry-on.  It also works for hikes and day trips, which can’t really be said for the wheel-about carry-on.  I’m trying to eliminate uni-tasking objects from my life as much as possible, and a purpose-made carry-on bag isn’t really good for much else besides air travel.  If I were a frequent flier, I might have made a different decision.  But the last time I flew anywhere was in 2007.  We have a toddler now, and flying doesn’t sound so appealing anymore.  In fact, traveling in any form doesn’t really seem like as much fun as just hanging out at home with my husband and son.  In addition, my understanding of how my actions impact the planet has increased dramatically over the last several years, and these days the idea of flying just conjures up images of greenhouse gasses rather than exotic destinations.

So I put the bag back on the shelf for someone else to find, and left the store with the small set of shelves.  The corner by our back door is now neat and tidy, and I don’t have to find room in the basement for a bag that might come out of storage once every couple years.

All is good.