Tales from the Wallet: What to Do When You’re Facing “Frugal Fatigue”

frugal fatigueHow do you prevent “frugal fatigue,” also sometimes called “savings burnout”? It’s that feeling that you’ve been scrimping and saving and you have no money and the debts are still there and you’re not getting anywhere and dammit you just want to not think about it and buy what you want for a little while? I know readers have talked about this, and when I was writing the post about my budget spreadsheet, I realized that I have another spreadsheet I use also that, for me, prevents this kind of frugal fatigue: my “snapshot spreadsheet.”  This is how I personally prevent frugal fatigue, but I’m curious to hear from you guys — ladies, how do you prevent savings burnout? Do you rely on Mint or YNAB to give you an accurate picture of your net worth? How do you track net worth changes? Do you have similar ways of recognizing and patting yourself on the back for major monetary accomplishments, like debt payment or saving? (These particularly are helpful in guarding against savings burnout!) 

Pictured: Vera Bradley Georgia Wallet, $98 at Zappos in six colors. Love the fun inside lining! 

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Stressed About Filing Taxes?

Stressed About Filing Taxes? | CorporetteLadies, we have a bit more than a month before (dunh dunh dunh) Tax Day. Are you done with filing taxes? (And, who is doing them?) Are you stressed about them? Are you looking forward to a refund? Are you nervous about how much you’re going to have to pay?

For my $.02, I’m just starting to get stressed. I’ve used an accountant for as long as I can remember, but this is the first year I’m trying to use a bookkeeper as well. (I’ve never actually used TurboTax or similar software for filing taxes — my father may have used that when he “helped” / did my taxes for me my first year or two out of college.) But after law school, a friend recommended an accountant to me — this wonderful, older gentleman who I really liked. I had a simple tax situation at the time, and his services were, perhaps accordingly, pretty affordable. When we bought the apartment in 2009, though, he nearly missed a major tax credit; thankfully we caught the mistake before we signed our taxes. When we started looking for a new accountant, we knew income from Corporette was making our tax situation more complicated, so we were ok to sign on with a fancier accountant who cost 4-5 times what my former accountant charged. (Something else I learned when I switched accountants: estimated taxes aren’t optional for business owners, which was something I understood after talking with my first accountant. Fortunately it wasn’t a big problem since the extra income was so small back then, but it really drove home how much the first guy was hurting more than helping.)

Every year since signing on with my new accountant, he’s sent us a huge “Tax Planner” PDF as part of filing taxes. It’s about 50 pages long in tiny print and asks a zillion questions, and it’s always taken me hours and hours to complete. This is the first year I’m trying to outsource the tax planner to a bookkeeper; my hope is that my reviewing it will take a lot less time than my doing it. (Gotta delegate, right?)

In terms of actual taxes, April 15 is usually pretty rough as a self-employed business owner because my retirement savings are due, to be invested in one huge chunk, usually; final taxes for 2015 will be due, which may be higher than what I paid the previous year in estimated taxes; and the first chunk of estimated taxes for 2016 will be due, using new numbers based on my 2015 taxes. Those are three unknown numbers — and in the past we’ve had some nasty surprises where I needed a lot more in cash on April 15 than I had set aside. (Hooray for the emergency fund!) Now, after paying work-related bills, I earmark about 40¢ of every dollar I earn for month-to-month living expenses, and save the rest in Ally accounts that get 1% interest for taxes and retirement. I’ll breathe a happy sigh of relief should April 15 come and go without too many surprises.

Ladies, how about you — do you do your taxes by yourself? Do you consider them complicated or easy?  How did you find your accountant? 

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Tales from the Wallet: Retirement Savings

retirement savingsLadies, how much do you save for retirement? Why do you do it? There was an interesting commenter thread about feeling saving burnout and wanting to splurge a little — do you count retirement savings as something you can cut back on, absent a strong need? We’ve talked about how much to save for retirement, what kind of tax-savvy investments exist to maximize your retirement savings, when to pay down debt vs. save, and where retirement should fit in your total money roadmap.

(Pictured: Hobo ‘Taylor’ Glazed Leather Wallet, on sale at Nordstrom for $70.)

For my $.02, I didn’t get started saving for retirement in a 401K or other tax-savvy vehicle until my late 20s, and I regret that — as they say, there are few powers in this universe stronger than the power of compound interest, and this kind of chart always freaks me out. My husband and I have generally taken the view that saving for retirement is one of our top priorities, and we max out every tax-advantaged vehicle. Like most parents of small kids, I’ll admit that these past few years (yay, childcare expenses) have been tight, and we’ve been moving money from our other, non-tax advantaged savings in order to max out our retirement accounts. (In case that’s unclear — I try really hard for us to spend less than we earn, and I kind of freak out if our take-home earnings for the month are less than we need to pay our bills. But then I remember that our retirement savings and 529 savings are deducted before they get to our take-home earnings, so as long as I can use our other savings to make up for the shortfall, I feel OK about it — within reason.)

How about you, ladies — what are your strategies for retirement savings? Does anyone get a match or perk you’d care to tell us about (anonymously)? Any good tips on how to do it? 

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Tales from the Wallet: Paying Down Debt vs. Saving

paying down debt vs. savingIt’s the New Year, and I heard a lot of chatter among commenters about when they should be paying down debt vs. saving. It’s a huge question, and we’ve talked about some related things (like how to pay off huge student loans and live within your means), but we haven’t talked about when to save vs. when to pay down debt in too long. Readers, what are your best thoughts on paying down debt vs. saving? When is getting out of debt a priority?

(Pictured: Comme des Garçons ‘Super Fluo’ French Wallet, $204 at Nordstrom.)

A few thoughts from me:

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Tales from the Wallet – Buying a Home

Tips on Buying a Home | Corporette

How does buying a home affect your finances?  How can you best prepare for it?  This is a huge topic, but we’re going to attempt to take it on as part of our Money Milestones series, which explores how a few big milestones in your life can really affect your finances.  So far we’ve looked at wedding budgets, how to financially prepare for a baby, and how to pay for grad school.

This can be a tricky issue, and we’ve covered a lot of the hows in my last post on owning property (where we also discussed whether to buy a home when you’re still single), as well as in our discussion on where you live is one of the biggest money decisions you make. Some thoughts on how to prepare for and survive a home purchase:

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Tales from the Wallet: The Best Books and Sites for Financial Advice For Newbies

best personal finance booksWhich are the best personal finance books for newbies?  Reader E had a great question:

I absolutely love your Tales from the Wallet series, but I find a lot of the lingo is a little over my head. I do understand that most of your readers are lawyers and professionals with sizable incomes, but I was wondering if you had any book recommendations for readers like myself. I didn’t invest in a 401K through my employer because I didn’t understand it. The idea of having money deducted from my account for a stranger to manage and crossing my fingers for the best didn’t sound very appealing to me. After reading some of the comments, it looks like there’s more to it. I currently don’t have any investments and want to start to learn about vehicles to put my money in. Please share absolutely any resources for new investors! Thanks!

Everyone has to start somewhere, so I think this is a great question. We’ve talked about tax-savvy investments on here, of course (and may answer some of your 401K specific questions), but in general it can seem daunting to learn about personal finance. (Pictured: Kate Spade New York ‘Popsicle’ Coin Purse, $78 at Nordstrom — according to the reviews it’s surprisingly functional!)  I’ve read a bunch of personal finance books over the years; these are the best ones that I would recommend for newbies: [Read more…]