Practical vs. Playful: Ways to Spend Your Tax Refund This Year

As a person living mostly on Disability, I get a fairly low tax refund from my other sources of income. But I do get something, it’s just under $500. In my past blogs around tax time, I’ve urged first the Practical Approach, looking at your refund as money you paid into the system and deserve to treat frugally when you get it back.

In the past, I’ve used tax refunds for:

• an emergency fund for computer repairs
• putting the money in a savings account and paying off bills in those months when money is short
• paying down credit card debt
• investing in much needed car repairs or even an off season warmer winter coat
• taking care of the not so urgent but very necessary dental work.

In other words, Needs.

But this year, I am also including self-improvement Wants as a refund spending option but only when those financial Needs have been met. The Playful Approach - seeing the refund as a way to reward yourself for your financial hard work!

• How about a wanted new piece of furniture for around the house like a large, comfy armchair? Check out furniture store sales and local flea markets.
• Create great memories with the money: Put some money away for a shortish summer vacation (We’re going to Cape Cod this year, five hour drive, four day stay).
• As a Want and a Need, take a class in a subject that could help you move ahead at work or purchase computer software you’ve been wanting to upgrade.
• And how about a slightly expensive, new suit for out-of-town work meetings? Want/Need.

If you decide to go the Want route with a portion of your tax refund, don’t feel guilty! Consider spending your refund on you as simply treating yourself well. 

Go ahead and make a memory.

Cindy

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Cindy Battles is a freelance writer based in Rutland, VT, winner of the National Disability Institute’s 2008 Blog Contest and a regular contributor here on the Real Economic Impact blog.

SaveUp - Website of the Week →

SaveUp is a free rewards program that connects to your existing accounts. SaveUp rewards you for increasing your savings and reducing your debt in almost any bank in the US. Using a similar technique to connect to your accounts that great sites like Mint.com use, SaveUp sets itself apart by being purely a game and not ANOTHER monitoring tool. What’s great about this approach is that even those who have very limited incomes or financial accounts can still be rewarded. You can even gain credits by doing things like completing quizzes on the site and inviting friends.

How it Works

SaveUp can securely connect with nearly every financial institution in the US that provides online banking services. Using this connection, SaveUp monitors account balances in order to issue credits.

Think of credits as reward points — every time you save money or reduce debt, we automatically award you SaveUp credits. Use these credits for the chance at cash and prizes.

Use the credits you earn from saving money and paying down debt for a daily chance at cash, cars, vacations, and rewards up to a $2,000,000 jackpot. The more you save and reduce your debt, the more chances you have to win big!

Visit www.saveup.com today to learn more!

Beating the February Status Quo

It’s that time of winter when you might not be living up to your New Year’s resolutions. You remember: Eat fewer sweets. Exercise more at the gym. Are you stuck in what I call “February Status Quo?” My take? Replace your unfulfilled resolutions with some economic solutions. In my last blog, I wrote about giving up drive-thru eating. That saved me at least $15 a week. Other suggestions for saving during the late winter months are as simple as walk, talk, and get together, etc.:

Walk

Go grocery shopping with a friend and walk the aisles together chatting and getting your groceries. You’ll save on gas going together and have two pairs of eyes for spotting those supermarket bargains.

Call a few local gyms and find out if they have any 2 for 1 membership deals (you may have to call around). Then grab a buddy and walk the treadmills together discussing how the day went. You’ll split the cost of the gym and be doing something good for your health. (Remember that resolution about going to the gym?)

Talk

Instead of meeting up with friends at Dunkin Donuts or Starbucks for a chat, have them over and brew coffee yourself. Talking is just as good at home over Folger’s. And cozier.

Have a call buddy/shopping sponsor to talk you out of ordering that gigantic piece of exercise equipment which you already suspect will ultimately hold and hang clothes in your living room. I don’t buy anything over $25 without running it across my buddy. It helps to have someone who is also on a budget and successfully getting by to be your call-in sponsor.

Get together

Dining out with friends is one of my favorite things to do, but it can add up. Try planning a bi-monthly potluck to replace some of those meals out. Warm up dishes in the oven and gather round your diningroom table. This beats itemizing bills and leaving sizable tips. Also groups help in fighting those isolating winter blues.

Do laundry with someone, share a car to the laundrimat and back for reduced gas prices. Flip the laundry from washer to dryer and fold while you visit. Friendship makes even the laundry more enjoyable.

This last tip was recommended by a friend: hold a Savings Party where like-budgeted pals pool together their own ideas and perspectives for saving money.

Whatever you do, join me in making sure this February won’t be like the others before. Join me in beating the status quo!

Cheers!

Cindy

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Cindy Battles is a freelance writer based in Rutland, VT, winner of the National Disability Institute’s 2008 Blog Contest and a regular contributor here on the Real Economic Impact blog.

Spend Some, Save Some - Publication of the Week →

Spend Some, Save Some is a financial education guide published by CFED. The free, easy-to-read guide (available in English and Spanish) walks VITA clients through some important things to consider when they receive their refunds to help them make the most of the money they expect to receive. The guide and the included Savings Plan Worksheet can help taxpayers:

• Recognize the value of using the tax moment to contribute to their short- and long-term savings goals
• Make decisions about how to use their refunds for spending on “must-haves,” saving for the future and spend on “nice-to-haves”
• Get connected to resources like U.S. Savings Bonds, College Savings Accounts, additional tax credits like the Saver’s Credit, Individual Development Account programs and Bank On campaigns

Read more about Spend Some, Save Some at the CFED blog. The page also includes a link to the spanish version of the guide.

Putting My Money Where My Mouth Is

This year may be the year I resolve to put my grocery shopping money where my mouth is and stop frequenting Taco Bell drive-thru twice (or thrice) a week for their rice and bean burrito.  Not to say that their burrito is evil per se (though it is tasty and addictive).  It’s just not sensible financially when I could be spending about the same on bags of rice and beans and some flour tortillas at my local supermarket and always have these staples on hand at home. 

Remember the old adage about shopping the perimeters only of your supermarket?  There’s something to that. Carefully plotted out, a healthy eating plan can be as inexpensive or more so than fast food where McDonald’s meals can now top six dollars. (I may have gotten the salads, which are also pricey, but I’m an avid scanner of their whole drive-thru menu.)

“It’s a total myth that eating healthy is expensive,” according to dietitian Katherine Tallmadge, author of the book Diet Simple. In fact, she holds, “it’s the cheapest way to eat. The fat, the salty, the sweet, that’s the expensive stuff.”

With my resolution firmly in hand (clutching my reformed grocery list, that is) I did some sleuthing at my local Price Chopper Supermarket and found out that a large bag of potato chips can cost anywhere from three dollars to $5.99.  For the same money, I could buy several pounds of fresh potatoes with nutrients intact and many possibilities for preparation.

So I am now buying things like a lot of quite small and skinless cuts of chicken, those full of protein beans I love (I tell myself, “Don’t head for that drive-thru, Cindy!”) and fruits in season when they’re cheapest not to mention freshest.

Getting on track with healthier eating can save me money in the short term, but it has the potential to save me money in the long term as well.  Studies show eating right and regular exercise can lower prescription costs and medical costs can decrease as well.

Exercise can also improve conditions like diabetes, high blood pressure, high cholesterol and heart disease.  That translates into better overall health and fewer doctor visits. 

Well, catch you later.  We might bump carts in the fresh veggie aisle.

Cindy

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Cindy Battles is a freelance writer based in Rutland, VT, winner of the National Disability Institute’s 2008 Blog Contest and a regular contributor here on the Real Economic Impact blog.

The Comfort of Resolutions

That title may seem like an oxymoron, but there is comfort in carrying through on your new year’s promises to yourself. The web offers a myriad of ideas for starting fresh and here are some of them I’ve rounded up:

• Financially, strive to put away a small amount of cash each month. Can you stuff a $50 bill a month in a jar? How about $20 or $10? Having spare cash relieves stress when unexpected financial needs pop up. And they will.
• Another way to avoid mounting debt is to use your credit cards only when necessary. Shop with cash and it has been proven you will spend less because you watch the bills disappear, and that slows you down.
• Also with your credit cards and other bills, pay your balance off in full and on time. Resolve to be a punctual payer in the new year. It’s important to establish responsible bill-paying habits.

Other great resolutions I’ve heard from friends:

• Snuff out your last cigarette. Depending on the cigarette taxes in your state, you can save a small fortune by becoming a former smoker. This is a no-brainer.
• Redo your workday spending habits. Instead of frequenting restaurants, bring lunch to work from home as often as you can make it. Rethink public transportation - using less gas and eliminating parking fees could save you a decent amount of money each month. And if you’ve resolved to read more this year, public transportation is great for that.

Just a few ideas to get started on the right track. In my next post, I will address food issues which I am struggling with. Until then, stay warm and try to stick to your resolutions. If you try in 2012, strangely enough, you’ll feel more comfortable.

Happy new year,

Cindy

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Cindy Battles is a freelance writer based in Rutland, VT, winner of the National Disability Institute’s 2008 Blog Contest and a regular contributor here on the Real Economic Impact blog.

Skip the pricey coffee and make your own! Today’s MoneyMondays tip.

Try making your own coffee for a week and tallying up what you save. You may never go to that coffee shop again!

Last year, I tried an experiment where I gave up expensive Starbucks coffee and tried making my own every day. Talk about savings! I went from spending over $20 a week at Starbucks to spending $7.50 - and that was with Starbucks’ Instant Coffee - the savings would be even greater if I made coffee the old fashioned way. 

I decided to run this MoneyMondays tip again because, unfortunately, I’ve been spending too much at Starbucks again and needed to kick my frugal self in gear, especially with it being the holidays. That coffee money could go to much better use as a gift or two. 

So here’s my old post. I hope it inspires you (and me!) to save a few bucks.

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I really should buy stock in Starbucks. I go pretty much every day. That’s not very smart, budget-wise, but it’s just so good! I love iced coffee more than just about anything in the world!

Last week I went to my local Starbucks and picked up a pack of their new VIA - instant iced coffee mix. Much to my surprise I really liked it. For 6 dollars I got 5 packs of VIA, which makes 5 16oz drinks. I spent $1.50 on a small carton of milk and everyday this week I have had iced coffee that I prepared at the office. 

So let’s compare:

• Normally, I spend 4 dollars each morning on coffee: $20 a week
• This week I spent $7.50 for 5 days worth of iced coffee goodness

That’s a savings of $12.50 each week and if I stick with it, at the end of the month I’ll have saved over 40 bucks!

You should try it too, if not the Starbucks instant way (which is pretty good for instant coffee, I must say) then buy a pound of your favorite coffee and brew it yourself. Let me know how much you saved - reply to this post or tweet it using the tag #NDIMM.

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“MoneyMondays” is a text message campaign powered by Infield Health. Sign up to get tips like these to your phone every Monday! Text REITMM to 69302. Remember, standard text messaging rates apply.

Skip the fees - rent movies from your local library! - Today’s MoneyMondays tip

Want to rent a movie? Go to your local library and borrow one for free instead of paying rental fees.

When we think of a library we almost always think of BOOKS. But most public libraries are great resources for all kinds of media: Books, magazines & newspapers, music and even movies. Check out your local library’s media section - you might be surprised at the selection. And with holiday season in full swing, picking up a few holiday classics to enjoy with visiting friends and family is a great idea.

Growing up, I used to think the movie section at my local library had only old, boring documentaries and things that wouldn’t interest me, but boy was I wrong. The only downside was that newer movies were of course, more popular so sometimes I had to get on a waiting list for them, but the same could be said for some of the bigger chain rental places too!

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“MoneyMondays” is a text message campaign powered by Infield Health. Sign up to get tips like these to your phone every Monday! Text REITMM to 69302. Remember, standard text messaging rates apply.

Saving Thanksgiving

I have a friend here in Vermont who is a parent of a son with a disability and she works full-time in a low-paying job. Caring for a child with disabilities can stretch your money thin any time of the year, but it’s much more difficult during the holidays. She mentioned that she doesn’t think she’ll be able to afford a turkey and the fixings for Thanksgiving. We have invited them to come with us but so far, she is reluctant. She said she feels some shame that she is in so much debt that she can’t put on her own dinner. Money issues are fraught with deep emotions.

I sat down with her and shared some seasonal money saving tips I culled from the web and from my own personal experience, hoping I could save Thanksgiving for my friend and her son. First of all, was she willing to join me in a Spenders Anonymous group and be my “money pal?” This way she would call me before she dropped a lot of money at Costco stores as she tends to do. I would ask if the purchases, especially Christmas presents, were really necessary. Or could she just “look” during the holidays and leave it at that? I have a “money pal” in the program that I call before buying expensive items like furniture or exercise equipment. This has forced me to be reasonable and in many cases, do without. I think it will work as well for my friend to give me a ring before ringing up.

Another idea is to use only cash as often as possible. It has been proven that using cash reduces your overall spending. When going to the mall, leave the credit cards at home and know exactly how much you have to rely on for the trip. As the web says, you will watch “40 dollars turn to 35 turn to 25 and so on.” Slower and more effective than a dashed-off receipt. With cash only, you automatically stick to a shopping budget.

Finally, when she shops for groceries, I urged her to buy store brands. Even consider purchasing a chicken instead of the pricier turkey. There are a lot of savings like these to be found in your supermarket. Maybe she can afford a Christmas dinner by relying on the cheaper but good quality brands.

I don’t know what she will decide but I hope she doesn’t skip Thanksgiving as she has said she’s planning to do. Our economy is in drastic shape if someone with a full-time job is talking about having to pass up the upcoming holiday. Student loans, mortgage, and truck maintenance have set her back into serious debt.

One thing I know for sure this holiday: she and her son are welcome to join my family as we give thanks. Hope you too can share your table with someone in need.

Happy Thanksgiving,

Cindy

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 Cindy Battles is a freelance writer based in Rutland, VT, winner of the National Disability Institute’s 2008 Blog Contest and a regular contributor here on the Real Economic Impact blog.

Pay Yourself First! Today’s MoneyMondays tip.

Pay yourself first. Learn more about paying yourself first at www.pyfchallenge.com

Paying yourself first is a strategy used to make saving easier. We tend to think of bills as the first place where our money should go. The PYF philosophy is that you should automatically setting aside a certain percentage of each paycheck to put into savings, before you do anything else with your money. If you don’t pay yourself first, there will always be something that money could be spent on instead of saving it.

More about Paying Yourself First: 

MSN MoneyCentral

Investopedia