Challenge: No Manual Money Moves in April

I’m a perfectionist. I like to fidget with things. Some times, this can be good, but other times, it can be detrimental. So I’ve declared that April is the month of no manual money moves. Why is this possible?

  1. My cable, cell phone, and electricity bills are all on auto-pay, as are my HOA dues and my property taxes. (I set my property taxes up to pay in the online bill pay once I get the bill.)
  2. My credit card bills are on auto pay.
  3. I have no pressing concern to open a new checking, savings, or credit card account.
  4. I’ve already made my 2012 Roth IRA contributions and I don’t know if I can make any for 2013 yet.
  5. I’ve already made my April mortgage payment and I will make my May one on May 1st instead of earlier this time. (I usually schedule it once I know the exact amount of my paycheck.)
  6. I’m expecting no bonuses or other windfalls in April.
  7. I only get paid once a month, on the last business day of the month.
  8. My 401(k) contributions and allocations are set up for the year.

Forcing myself to not fidget with things is good. This is sort of like my rule of no selling to re-balance my investments.

I’ve been eyeing another credit card lately. The American Express Blue Cash Preferred looks pretty intriguing. It has a $75 fee, but you get 6% cashback on groceries, up to $6,000/year. I will most likely spend about $2,500/year on groceries, which is the tipping point at which the Preferred card makes sense over the Everyday one that only gets you 3% cashback on groceries. With the Preferred, you also get 3% cashback at gas stations and department stores, versus 2% with the Everyday. The tipping point is that I can buy Amazon.com gift cards at my local grocery store and then use those for my Amazon.com purchases, netting me 6% cashback on Amazon.com purchases instead of the 3% that my current system gets me. The catch on that is that I’m spending a lot less on Amazon.com these days than I was. If you’re just looking at flat-out grocery spending, you need to spend $75 /(6% – 3%) > $2,500/year on groceries for it to make sense to pay the annual fee.

Both cards have sign-up bonuses, $150 for the Preferred card and $100 for the Everyday, if you spend $1,000 on the card in the first 3 months. That makes the cost of the Preferred card in the first year -$75 versus the cost of the Everyday card -$100 in the first year and then $0 thereafter. So you would net $25 more with the Everyday card upfront, but with $25 / (6% – 3%) > $833.33 in grocery spending over the course of that year, the Preferred card would make more sense and then you can always switch to the Everyday one after a year to avoid the fee if you don’t think it’ll make sense going forward. I’m pretty confident that I will spend more than $69/month at the grocery store, lol! I’m not so confident that I would spend more than $208/month consistently though.

Another cool feature is that both cards come with Roadside Assistance. My car offered that for the first 3 years, which will be up by the end of this year. I did resolve though that I would wait 6 months from early January to apply for another credit card and it’s only been three, so I guess that means I need to wait until early July.

BUT I am not making any manual money moves in April. I’m tracking my spending, as per usual. My (bimonthly) electricity bill went down $50 from the last one, which is a good improvement! I’m hopeful that the next one will go down another $50 since I hopefully won’t need to run the heaters for much longer.

The last six months have shown me that life is still changing constantly. In the last year, I have made many life decisions: bought a condo, moved into said condo, started a relationship, changed jobs, and ended said relationship. I’m so thankful that as I navigate my twenties, I now have a stable home environment in my condo and I do have a pretty stable job that lets me not worry about money. With > $2,000 in spare cash flow each month and enough in savings to live off of for 12 months, I don’t really worry about money any more, which is a really nice feeling as I figure other things out.

I’m also trying to stop relating everything back to money. This is especially important as I adjust back to a single person’s social life, in terms of spending habits. I think I should still be able to keep my social spending under control though since my ex and I had somewhat different priorities on how much to spend on various things.

Readers, are you doing any challenges with your money lately?

Advertisements

31 thoughts on “Challenge: No Manual Money Moves in April

  1. Leigh,
    I love months like this… I am similar in that I am frequently doing and making changes and planning for future savings and adjustments and so forth. I like to take a few months out of the year and let the autopilot take everything under its wing and come back to it a month later.

    It is a refreshing feeling to not always feel like money is on the mind.. I am working more and more away from that and I have actually done VERY LITTLE this year with making changes. I was kind of letting Q1 ride the autopilot.. I’m doing a little checking in as we go into Q2 and have decided I’m selling some equities that have done exceptionally well and I don’t see much upside in them any more..

    It’s nice to see that you too can take a breather once in a while!!!!

    I like how things are looking for myself and now just getting ready to enjoy the summer!!

    • Good job on leaving everything on autopilot through Q1! :) I think I might try that next year since I most likely won’t see a bonus in Q1. I’m definitely looking forward to summer as well!! And I’m working on planning my trip to Japan in September :D

  2. No challenges going on here right now. Just paying taxes :-(
    Although you reminded me that I should see if we’re using the best Amex Cash back card. We have one right now that we’ve had for years with no annual fee, but it might make sense to switch to the one with a fee. We spend SO much on groceries. At least I’m always shocked by our grocery bills.

    Hope you are weather all the changes well. At least it is spring!

    • That’s too bad that you guys have to pay taxes :(
      If you’re spending $400/month on groceries, you would get $213 in cashback per year, after the annual fee on the Amex Blue Cash Preferred. Not a bad deal – that’s almost $20/month!

      I think I am – I’ve gone back to baking and reading, which are quite relaxing :)

  3. I think this would be a good idea for me and Kyle would definitely be in favor! I might make it a 1-day-only-per-month of manual transactions so I can keep up with my targeted savings, though.

    • Yup! That’s what I was trying to do at first and then I realized that I should just go all out. For some people, automating is good for ensuring they don’t forget, but for me, it takes away the fidgeting.

      One big thing I did too was the splitting of my direct deposit. That way, I don’t have to consult my spreadsheets to figure out how much goes to savings! Letting go of the control of fidgeting is so hard!! It also made it easier to have only one day of manual stuff allowed.

  4. Trying to reign in spending and not doing a great job at it. Because we have a low cost of living at the moment, we should be saving a great deal. However, we tend to spend more just because we can. Which leads into an issue I have with my Costco Amex. Because we get cash back and credit makes me “feel” rich, I’m sure I spend more than I should. On the other hand, there are times when I think we “deprive” ourselves when we stop ourselves from buying anything. Such a constant battle being waged.

    I’m fascinated how you are able to save so much of your income without being tempted to splurge. Then again, I think being raised in the Big 80’s, I’m conditioned to want to live large…

    • The key (I think) is to separate the purchase you’re making from the medium you’re using to make it. I think about spending not in terms of how much cashback I get but in terms of where it sits in my budget/priorities.

      It’s my personality. It just doesn’t think about splurging.

  5. I used to update a spreadsheet everyday when I first got out of college. It was necessary because spending was a lot tighter. Now that it is not the case and I feel like I have a good sense of how much I am spending, I actually let myself just not worry about the details. Once a month I check for any irregular transactions and look at my savings/checking balance. If it is within $250 of what I think it should be, then I don’t worry about it.

    Good luck on finding someone who has spending priorities similar to you! I’m sure they are out there.

    • I used to do that too. I don’t want to lose my data, so now I only update my spreadsheet once a week or two or at least once a month. My spending is still pretty much in line, but I do like having the historical data. I started tracking more closely as my income increased, to help keep cost of living down. Thanks for the good wishes! I’m sure they are too…somewhere.

  6. I know how you feel about having different spending priorities than your partner. It’s been a battle since I decided to tough it out only because my spending priorities changed when I was already in the relationship. Frugality has grown on her that’s for sure, but we still dance a delicate ballet on separate and mixed spending. At one point, we must have been at polar opposites of the spending spectrum. She definitely influenced me out of the “cheap ass” extreme side into a happy middle ground.

    • If you have good communication channels, I think having different spending philosophies isn’t necessarily a bad thing since it does bring you more into the middle overall. There truly is a fine balance there and I’m trying to find it! I’m also trying really hard to be frugal rather than cheap.

      • Balance is elusive in personal finance. I’ve been looking for it my whole life! It can vary depending on the situation. Such eternal questions that make PF so challenging, can I afford it? is it worth it? Throw goals into the mix and walla, never ending posts for PF bloggers :)

        • :D Balance is even harder when it requires negotiating between two people, rather than one person just being a bit pensive.

  7. I keep meaning to sign up for AAA or roadside assistance. It’s such good insurance for a reasonable price. I am trying to force myself to stop making money moves as well. I feel like every two weeks I want to tweak how much is going to various index funds/savings. But last month I didn’t touch anything and just let the automatic deposits/debits take their course. I watched as I got down to about $800 in my checking account the day before my paycheck. I always get nervous about a lower balance, but I know it’s more efficient to just let it go.

    • I think my current plan for roadside assistance is to find a credit card that offers it for free instead of lumping it into my car insurance or signing up for AAA, haha. Something that’s helped me with my fiddling as well was setting up text message alerts for whenever a transaction happens on my checking account. It’s really hard to not fidget, but I think I’m getting better at it!

  8. I’m not doing any challenges right now, but we are about to switch credit cards. We are saving points for an overseas trip so I just spent $5000 in 6 months on a Starwood Preferred Card and now it’s my husbands turn to do the same. Then we should have enough points for our trip!

    • Awesome! I’ve never really gotten into the credit card arbitrage thing myself and I’m not sure I could find $5,000 in credit card spending over a 6 month period.

  9. Good luck with refraining from fidgeting with your finances, for a perfectionist I’m sure that can be a challenge.

    Sorry to hear about the ending of the relationship; those are never fun :-(

  10. I use the everday AMEX card for several years and it has worked out pretty well for me. I like the way you broke down the costs associated with groceries and % back. I totally forgot the AMEX offers roadside assistance. Good looking out!

    • When I hit the 6 month marker, I’ll do some analysis on various cards and post my math! The problem I see with credit card rewards is that I don’t actually spend a lot of money, so they’re not all that profitable and getting more than 1% back is only marginally more profitable at my spending levels. They’re clearly made for people who end up spending more than my non-mortgage $24,000 goal for the year ;)

  11. Great job automating your financial life! It’s definitely a great way to make things a lot easier. I wish my regular bills would let me choose the due date. There are some that are so far off from others that I can’t let them all go on the same day currently.

    • I used to think that people who automated everything were dumb because many of them don’t read the statements. But I’m still reading the statements, just not making the payments manually. I don’t care about the due dates so much since I get paid only once a month.

  12. I’m glad you’re saving time and stress. Focus on how you generate value because you create a lot of it and your earnings power proves it. I’d like to automate but I’m still at that stage where there are too many variables and I’m enjoying full paycheques again for the first time in a while after parental leave lol

    • Thanks Joe! Definitely trying to get back there. It was hard to automate when there were so many variables but there are becoming fewer variables which makes it so much easier. I also don’t put trust in others very well, e.g. the utility company to actually charge my credit card and the charge to actually go through lol. Enjoy those full paychecks! They’re so wonderful.

Comments are closed.