Embarking on a Savings Marathon

The next couple of months I'm embarking on a savings marathon. Why? Well for many reasons...vacations, a possible new business venture, higher ed...and as if all that's not enough Christmas is around the corner.  In about three months time we will all need a little extra cash to cover the holidays.

Before I embark on this new savings marathon I thought I'd take a deep dive into my current cash flow to see how flexible I can be/how easy it will be to save more.  Good thing I use mint.com - it takes all but a couple minutes to pull up a couple graphs and see my spending trends of the past couple months!  Here's what it looks like so far:

My total spending over the past 6 months

Spending fluctuations over the past 6 months

And what does all of this mean? Well let's start with the categories (Image #1).  The good thing is that only about 1/3 of my budget is fixed expenses (Housing and Bills).  My 'Food' category is taking up a large chunk of my budget, but well it's food and I kind of need it to survive, but I'll get back to that.  What I need to look into is my "other" category (quite large), my uncategorized category (which is skewed because one expense is really a reimbursement I had trouble categorizing correctly) and lastly my shopping category.  Looking at the spending over time (Image #2), I can definitely see the month of May standing out.  This is probably because I booked flights and hotels to Las Vegas and Seattle.  A more alarming trend is my spending going up over time (keep in mind this month isn't over yet).  I could attribute that to it being summer and there's just more stuff to do, but if I want to be serious about saving, I'll also need to focus on reversing the trend.

O.k. back to my 'Food' category. I broke down my food spending into more specific categories:

Spending on food broken down into different categories

With it broken down like this, I can see that my 'Restaurant' spending is a lot higher.  This is of course expected since going out to eat is more expensive than staying in...but again, this could be a source of savings! 

Spending on food by month

Lastly, my food spending by month.  April and June are standing out. Thinking back, all I can think of is that in April I was going through a stressful work situation and in June I traveled to a lot. Otherwise it looks like my spending is quite steady, which is good. I should be able to see swift changes, if/when I start focusing on this category. Next, I'll have to do this same breakdown for the other categories (like shopping) to inspect my spending trends and find places to save.  

Graduate School: Is It Worth It?

I've been gone for a while, I know.  Sometimes life gets in the way!

Last week I was in Germany for my cousin's wedding.  Happy to visit family and be part of the celebration, when the usual question came up: "When are you going to grad school?" And my usual answer: "Im planning on it...next year" with a big smile... But, it's not completely untrue, grandma, just the "when" part. I have been looking into it and I have an idea of what I want to study.  Two problems I encounter every time: standardized testing and the $$$.  I'll talk about standardized testing in another blog. Right now I want to talk about money (duh!).

It's going to cost a lot...every time I look at the numbers, I wonder why people even think about doing this. But here I am thinking.  One program, that looks really cool (really cool), is going to be $100k.  Of course on their website it says $51k, but that's only for one year and to graduate it's scheduled to take two years. So sneaky!

So I started doing the math in my head.  Say I save $20k and my parents help with $20k, that'll bring it down to $60k.  With my current salary, I could probably afford $500/month, living very cheaply that is...anyways, $500/month is $6000/year.  If I kept it up, I'd have it paid off in 10 years. Oh wait, interest. =( Interest calculations are too hard to do in my head...and even on paper.  So, I found some pretty cool resources online (I'm not going to be a mathematician so it's ok):

• FinAid Calculators: Most detailed calculator. 
• Debt/Salary Wizard: A very simplified calculator.  More of a guideline than a standard, since it assumes how much you are able to pay every month based on your salary, not your frugality! 
• You Can Deal With It: This site has a bunch of different calculators you can use to figure out either how many months it will take, how much your monthly payment should be, etc. 

In conclusion, before you consider grad school, you really need to figure out realistically how you're going to pay for it.  Imagining having a great, high paying job or lots of scholarships isn't going to cut it.  Having both would definitely help, but better safe than sorry.  As for me,  not sure I'll ever have a super high paying job as I like the nonprofit/NGO world, but I'll work on getting scholarships!  Including the interest, my monthly payments would have to be about $540/month to pay off the debt within 10 years.  So for now, I'll just save money like it's going out of style...