What's Your Debt to Income Ratio?

I always find it interesting how people often exclude mortgages and student loans as part of their "debt." I hear people say woohoo I'm done paying off my debt and I think to myself -Really? You've paid off that mortgage you took out a year ago?

For some reason we distinguish worth while debt like a student loan or mortgage as not real debt and only count things like car loans and credit card debt as true debt (although I also know people who don't count car loans as debt either).

The hard truth is that if you owe money to an entity you are in debt. I stumbled upon a helpful article explaining how to calculate your debt to income ratio. It's actually quite easy. Add up all your monthly minimum debt payments and divide that by your monthly income and voila- your debt to income ratio.

Anything over 40% is considered not healthy. Under 30% is excellent and 30-36 is pretty good. DH and I weigh in at 43.6%- ouch!

I think it's our 2 car payments that do us in. We both got "new" cars last year and are not even close to paying them off. I was extremely uncomfortable buying 2 cars so close together but my car was on death's door and once I got a gentle used car, DH "needed" his fancy new truck. I wish that I had started my financial challenge just a few months earlier last year so I could have avoided this "mistake." I'll mark this down as a lesson learned to follow my gut.

And the Numbers Say...

We got the quote from the contractors and I was pretty right on in my guestimate although I was secretely hoping that DH would be closer. Further evidence that DH doesn't quite get the full value of money and probably why I handle the all the finances. But that's not what I wanted to write about.

The quote is significantly more than what we have currently saved up. I'm glad scheduled the appointment and got the quote because we needed that kick in the pants to start seriously saving. We had hoped to have the remodel done in April but with this number we might have to push it back a few months so that we can afford to do everything that needs to happen.

I'm a little disappointed about the set back but hope to use this as motivation to get back on the wagon.

Monthly Recap- Dec 2008

I'd like to say I closed out 2008 on a high note but with the holidays and all the gift giving and over indulging, I closed out 2008 on a middle note. DH and I have a savings, which we are desperately trying to grow for our 2009 Bathroom Remodel project. I'm happy to say that in the later half of the year (around the time I started this blog) our contributions steadily increased and that continued all the way through 2008. I was even able to double our weekly contribution so I'm pretty stoked about that.

The sad news is there weren't many financial highs for December 2008:

• DH got a raise for completing his first year with the department.
• We doubled our weekly contribution to our savings account.

The lows for December were numerous and stem from a general bleeding of the wallet syndrome. I guess it's true that when I loss focus, I really lose focus. Go big or go home... (inside joke sorry)

• $500 for holiday gifts.
• $100 more than last month's already inflated eating out numbers. Bring this down will be our top goal for February.
• $100 more on entertainment. I have to admit we had a fun month and I don't regret this little splurge.
  
• $215 at Target, which is over $150 more than the previous 2 months. This was disappointing to see on paper.
  

The good news is DH and I are committed to our 2009 Bathroom Remodel project and we also really want to go on vacation again (hopefully in 2009 also but depends on how much the remodel costs). At least there are lots of places to trim the fat and start plumbing up that savings account!

No More "Treats"

We're half way through the first month of 2009 and I'm not sure that I've made as much progress on my mindset as I would have liked. True I'm making the bed in the morning, washing all the dishes at night, working out with the Wii and My Fitness Coach for 30 min every week day, but I still feel like I'm cheating the system.

A while back I admitted that my biggest challenge for 2009 was discipline and avoiding the guilty escapes of treating yourself. I have a confession to make- I'm still indulging in those little treats.

I had big plans to work out in the evening but ended up having to take work home. Instead of making time for both, I "treated" myself with a pass card to the work out so I could do my work and still watch tv. Lame.

The next night I had to make a special trip to the local feed store for my dogs' special food, because it is slightly out of my way I "treated" myself to a frozen pizza that night because I got home from work late and shouldn't have to also then cook. Pathetic.

It seems to be a regular theme for me -if anything out of the ordinary happens, I make it into an excuse to "treat" myself. But it's never really a treat just an excuse to be lazy and undisciplined.

Any suggestions on how to stop this?

Progress Report

As I mentioned in my previous post, I’m working on creating a more disciplined (or structured) schedule as I think it will help get me in the right mind set I need to accomplish my 2009 goals (to be disclosed in a future post). I’m taking baby steps to ease my way in since I’ve been pretty fast and lose with a lot of my household chores and what not. I’ve started off with little things to help me keep a cleaner house which also reminds me to balance out my work life by putting my home life at a higher priority.

Progress Report-

1. Wash dishes every night. This is going quite well and by doing the few dishes we have every night, I never have that daunting pile of dishes that overflows from the sink to the counter. The bigger plus is since the kitchen is always clean, DH has started washing his plates occasionally! Must be the guilt of being the only dirty dish in the sink!
2. I’m making the bed every morning. Granted my dogs mess it up all day long but every time I go into the bedroom I straighten the sheets. Again it only takes a few minutes and it makes me feel better about myself.
3. I’m getting into my morning wii fit routine and I’ve even tossed in two other games to help keep me active in the evening (My Fitness Couch and Ski and Shoot) I’ll be sure to review them in a future post.
4. I’m making walking my dogs a priority. I live in a very small house and 3 hyper dogs is never a good things. We are all a little calmer if we take the dogs for a walk in the morning- I just need to tough out the rain.
5. I still need to work on the cooking 4 times a week I think last week I cooked twice. And by cooking I mean making an actual meal verse throwing veggie burgers in the frying pan and calling it a meal if you catch my drift.
6. And the cleaning calendar still needs to be created so I've got some work to do this weekend!
   

New Year Resolutions

In the spirit of the season I've been spending some time reflecting on my past, present, and future and have realized that while I use to be proud of my accomplishments and life, I'm really not that excited about the person I am right now. I think the biggest thing is that I strive on structure and as I've gotten older I've had less and less structure provided externally and more and more has to be internally motivated. So my New Year's resolution is to lead a more structured life and to stop making excuses for why I should be given "a break" just this once.

I read this article at the Happiness Project and it really hit the nail on the head. When I have a bad day I think that is a good excuse why I shouldn't have to do the dishes that night. But the reality is I will actually feel better if I just buckle down and do the dishes. Cleaning makes me feel better but I come up with excuses while I shouldn't have to do it. I don't know if this makes any sense to you, but it was an epiphany for me.

I've started a list of the following daily expectations and are tracking them in my daily planner:

1. I will cook at least 4 meals a week for DH and I.
2. I will use the Wii fit (or other wii excercise game) at least 15 mins 5 days a week.
3. I will walk my dogs at least 15 mins 5 times a week.
4. I will do the dishes daily.
5. I will start a cleaning calendar for weekly chores.

I 'm sure there are other things that I will add but this is what I'm starting out with and once they start becoming habit I will add some new ones.