Finance

Getting Started With Savings

First off, I want to give a big thanks to all of my readers, I write this just for fun but I am so happy to hear that my words are useful in terms of helping others with their financial futures.

With that said, after yesterdays post, I got quite the out-pour of text messages asking for help getting started saving money. It is very important, especially at a young age to start saving; whether it be for a rainy day, for a home, or for retirement even, because the money you save now will compound over the years.

The best measure when getting started saving money is to start by putting away 3-9 months of expenses into a savings account, then building off of that with other accounts (i.e. stock, 401k, IRA, mutual funds, property investments) to compound your money after you have an initial emergency fund.

The million dollar question though…how to get started? As Drake would say, “Started from the bottom ($0 in savings), now we here (6 months of expenses in savings)”

 

Step 1: Take a look at how much income you have coming in vs. going out. This is your cash flow. For example, lets say you make $40k annual salary, this means your take home pay after taxes is roughly $33k. Divide that income by 52 and you have your weekly average is about $630 cash on hand or about $2,750 per month.

Now, lets say your rent is $1,000 per month and utilities are another $100. That leaves you with $1,650 left over for other necessities like gas and groceries. Both are dependent on how much you eat and how far you have to drive to work, I will use my own averages to give a good feel as to how much these may cost. I spend about $50 per week on groceries and $50 per week on gas, which ends up running about $450 total for the month. What is left is now $1,250 for the month or roughly $290 per week on non-essentials.

So, I have $290 per week that I could possibly put into savings. Now of course there are other expenses that come up, like going to restaurants, buying clothing, personal care etc., but if you put some of the $290 per week into savings first that money won’t be tempting to spend elsewhere.

Step 2: Figuring out how much exactly to save. When you are first getting started, it is important to try and save your 6 month emergency fund at a higher rate say 20% of your take home pay rather than 10% once you have that fund saved up. If you make $40k per year, and you save $125 per week of your take home pay, that is 20% and you will have saved $6,500 over the course of a year. Of that $290 you have in cash after necessary expenses, you still have $165 to spend on fun items.

If you want to be a little more aggressive with your savings, so that you have your emergency fund even sooner, I recommend trying to save 30% of your take home pay in the beginning, that would be about $190 per week, giving you $100 per week of fun-money. If you saved $190 per week, by the end of the year you will have saved $9,880.

 

There are some great resources out there to get started with creating a budget, so that you can reach your savings goals. Last year, I made a very detailed spreadsheet and tracked everything that I spent and everything that I made. I included my income, as well as passive income such as money back on credit cards (roughly $500 in cash back) and dividends in my savings account ($100).  I am a big nerd with numbers, especially the type with $ in front of them, so I enjoyed tediously tracking every dollar in and out of my accounts. Now, I know this is probably not the ideal for most, so I would suggest signing up for a free service like Mint.com, or tracking your spending by category through your credit card company. Once you are able to identify exactly where your money is going, you can develop a budget to fit your life style, and once you set a budget your savings goals will be reached with much more ease.

Saving can be tough, but once you get started and have a goal in mind, working toward that and then achieving it is so rewarding. And don’t forget about interest! Because, once you start saving money, your money starts to work for you!

 

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Finance, Uncategorized

Sub Savings

I finally have hit my target goal in my savings account that holds 6 months of living expenses and decided to open a Sub-Savings account for funds beyond that. 

Opening a Sub-Savings account is a great way to apply disposable income for a large purchase, as in a Travel fund (which is what I am saving for). Creating one of these accounts can also be used for things like buying a car, house or big ticket item. 

A great way to get started with a Sub-Savings account is to decide what large purchase you are saving up for and when the deadline is to purchase. This creates a savings goal and by committing to save a certain amount weekly or monthly you will hit your goal by the deadline.

I have decided to create a Travel Fund, I am not sure where I plan to go quite yet, but my friends and I know we want to take a trip that will cost around $2,000. My deadline is September 1st to have the money allocated for the trip, so I am saving $100 per week. 

By switching a relatively small amount into my Sub-Savings account each week I do not feel as though I am losing such a large lump-sum at one time. The great benefit of a Sub-Savings is that its monthly dividends are equal in percentage to a savings account, whereas in a checking account those dividends are usually much less.

I am in my second week of saving for my trip, and am on target for my savings goal…now the only issue, where in the world do I go?

 

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Fashion

Stone Cold Sale

One of my favorite brands is Stone Cold Fox, a brand that takes a fresh approach on vintage looks that amazingly flatter a womans body. Every piece that they make is uniquely made locally in the USA out of the best quality fabrics and patterns.

Unfortunately for me, looking like such a Fox comes at a high price. One that my little paycheck cannot afford.

A girl can dream though, right?

Recently, Stone Cold Fox began selling their merchandise directly through their online store, whereas before their site just provided links to other retailers websites. There is also a an icon that reads SALE.

HALLELUJAH! 

So of course I had to take full advantage of a few of the styles that I had been eyeing for the past few months. I bought the red Helmut Gown from the site, as well as the Mija Gown from Planet Blue which was half off the original price, plus an additional 10% since it was my first online order, Planet Blue also offers free shipping which was great.

the Helmut Gown on sale for $90, originally $264

the Helmut Gown on sale for $90, originally $264

Both of these dresses are wearable for almost any occasion, as I have already worn my Mija Gown out at night, on a plane ride, during the day, with flip flops, with booties. It is so incredibly versatile.

Mija Gown - On sale at Planet Blue

Mija Gown – On sale at Planet Blue

Overall, I am quite happy with my purchases and saved almost $500 in total!

 

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Finance, Uncategorized

Jet Set Lyfestyle?

Oh hey there, I am alive if anyone was worried. Sorry for the lack of posts recently, but the last few months have seemed to go by in a flash (along with much of my bank account).

 

For starters, there was St. Patricks day weekend in San Francisco, luckily thanks to my job I had racked up enough air miles for a free flight there, and only had to shell out $50 for the return flight.

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at Fort Mason in SF

Then my Alma Mater, the University of Arizona made it to March Madness and my paycheck started disappearing, only to be found at the local bars (your welcome, Cabo Cantina Brentwood).

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after beating SDSU in the Sweet Sixteen game!

 

The month of April was basically dedicated to Coachella, it was my first visit to the epic weekend music-festival-soiree and my lack of planning for a ticket in advance lead me to hesitantly fork over almost $500 (every penny was worth it, and I already have my ticket for next year, luckily at face value this time).

Along with the actual ticket, the outfits, spray tan, hair, nails all had to be done since there would be thousands of photos taken and I would run into everyone I have met in the last 20 years over the course of the weekend. Gosh, being a girl is quite expensive when getting ready for an event. Overall I ended up spending close to $1000 for housing, ticket, outfits and beauty for the weekend. Thus, leaving me at peasant status and getting very close to dipping into my savings account by the end of the month (although I managed to keep it in tact!)

 

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the whole crew at Coachella!

 

Once my money wounds healed from April, May served to be a little bit more relaxed. My mom and I went on a Mothers Day trip to Cabo San Lucas and my tab at the Mango Deck was taken care of, gracias madre! I also found some great Luli Fama swim suits on Hautelook for almost 70% off retail for the trip.

 

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ran into my friend Brie in Mexico!

 

On Mothers Day before brunch!

On Mothers Day before brunch!

 

By the end of May, it was time to prepare for my annual reunion with all of my friends from college in Vegas planned for the first week of June. Nails, clothing, hotel accommodations and an over-priced flight left me reeling. Luckily for girls, once in Vegas, it is one of the cheapest trips known to man.

behind the DJ booth at Calvin Harris

behind the DJ booth at Calvin Harris

So there you have it. That is where I have been the past few months. Hardly jet-setting, but sort of. Anyways, now I am back on a spending diet, and have given up eating lunch out on weekdays, and gone back to shopping at Trader Joe’s over Whole Foods.

Time to go back to ballin’ on a budget. Since I gave no financial insight in this article, I would like to close by stating that Apple stock had a 7-1 split last week and is currently trading around $92 per share.

 

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Fashion

Brights and Basics

Now that the weather is heating up I can finally ditch my all black everythang attitude towards dress, and spice up my wardrobe with some bright colors for spring! This week I dined at Gracias Madre, a fairly new Vegan Mexican restaurant in West Hollywood, so it was the perfect opportunity to wear some fun, spicy pieces.

One of my most recent finds was my new Marc Jacobs quilted wallet. Finally, I have outgrown my college credit card holder as a wallet and upgraded to my more adult version. I bought it on Gilt for $269, on sale from its in-store price at $575!

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I also recently took a trip to Nordstrom Rack where I scored some great deals on Paige Jeans, the jeans I am wearing here were on sale for $79.

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Paired with a basic tee from Brandy Melville for $15 my look was complete and I was ready to eat!

 

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The pop of color comes in from my Halogen jacket I got on sale for half off last summer during Nordstrom’s Half Yearly Sale for Women (roughly $30).

 

The whole look comes together for about $135 plus the wallet totaling $404. Very reasonable for some big names in fashion. Lets just hope this summer-like weather stays around!

 

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Finance

The Money Challenge: Week 4 Recap

Finally, this month is over!

And I can’t exactly say I met my goal of only spending $150 per week, although I was fairly close each week. I have to say this experience has taught me that in order to really only spend $150 or less there is no way for me to have a social life, because everything my friends invite me to involves spending money on eating or drinking in some form.

Here are my stats for the week:

Kayak rental: $12

Coral Tree Cafe: $11.85

M Cafe Dinner Sunday: $13.03

Whole Foods Groceries: $37.52

Daily Grill Dinner and Happy Hour: $42.33

Lunch at Good Stuff Wednesday: $16.70

CVS: $14.70

Whole Foods: $10.89

Lunch Friday at Cafe Marmalade: $24.03

Total: $183.05

 

For the full month of February I was able to limit my spending on variable expenses to $843.40, which is almost $500 less than what I usually spend in a normal month. I have to say, even though I did not make my goal, my bank account is sure happy and full. Now, with that extra $500 I saved, I guess its time to make some investments to grow that cash!

 

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Fashion

When it Rains in Southern California

They say it never rains in Southern California, but after months of drought, the skies have finally opened up and my wardrobe could not be more ecstatic!

 

I have been waiting almost an entire year to break out my favorite trench coat that I got from Nordstrom Last Chance (the one-store for the most heavily discounted Nordstrom store items). The find is a Patterson J. Kincaid coat I bought for $12.99, and is the perfect rainy day accessory.

 

rainy day look cc: Stephanie Fennell

rainy day look cc: Stephanie Fennell

 

My other favorite item in this look is the Dolce Vita booties I recently purchased from Nordstrom Rack on sale for $46.90 they go perfectly with jeans or to liven up any look.

 

DV shoes w/ striped sweater from Mango

DV shoes w/ striped sweater from Mango

Dolce Vita shoes @ Nordstrom Rack clearance $46.90

Dolce Vita shoes @ Nordstrom Rack clearance $46.90

 

This look is very easy and affordable, and perfect for a gloomy day. Paired with my Prada sunnies that I got on Amazon.com for half off (the best place to buy sunglasses), the outfit is complete.

 

Now if only I could stay dry in this “Titan” of a storm!

 

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