Carnivals / Festivals

This week we have been included on four carnivals and festivals. We are also playing host to the Green It! Carnival on Monday, August 4th 6th, so be sure to come back for that. Green It! is very selective, and only posts the 15 best of the articles submitted.

We are pleased to welcome all new readers, as well as new carnivals to Not the Jet Set. To find out more about us, click here. We are a personal finance blog focused on frugality, stewardship, and current events, while also telling our story as a family and the personal finance decisions we have made. Thanks for stopping by and be sure to check out our new NtJS Cafepress shop! On with the round up...

The July 26th edition of the Carnival of Financial Planning is up at The Skilled Investor. It includes our post on what is quite possibly the most overlooked part of anyones financial plan - the will.

We've been included in the Carnival of Kids and Money, hosted by Money-Hacks. Included is our post on re-celebrating our independence from disposable diapers. Here is another kid friendly post from the carnival:
  • Money Smart Life gives us the keys to financial success, as taught by Kung Fu Panda.

Stop The Ride! is hosting this week's Carnival of Money Stories with ABC simplicity. You can find us under 'D' for disposable diapers, and our independence there of. Some other important letters of the alphabet:

Pinch hitting this week on the Festival of Frugality is Student Scrooge with his Summer School Edition. Enrolled in the 5th period remedial math course (personal finance) is our post on our cash envelope system. Some interesting posts from our fellow classmates:

Thanks for reading and thanks to all the hosts. Don't forget to tell your friends and subscribe to get updates via email or RSS.

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A Confession About Our Wills

We went to an estate sale the other day. My wife was interested in several items, so we showed up early and waited in line. While waiting to get in, there were some people ahead of us in line chatting up the guy working the door. As we listened, they were talking about the former owner. They were asking about heirs, and how it seemed like everything was for sale. Well, everything was for sale. The lady who had passed was an only child and never married. When her parents passed, she got a lot f their stuff and now that she was gone, there were no living heirs. Her will had stipulated that all of her money, plus the proceeds from the sale of her house and the estate sale would go to her favorite local charity.

The Mrs. and I looked at each other, and talked about how cool that was. What a great thing she had done, and set up so well. I then looked at the Mrs. and asked, "Do we need to update our wills." "Yes", she replied hesitantly. She knew we had neglected that. We just hadn't had the time.

So here is our confession about our wills - they need to be redone. They were done in a different state, which may or may not be such a big deal, but why chance it? Also, we have our second little one who was not around at the time of the first wills. We'd like for her to be with her sister and not in foster care... maybe. Might be nice for the two of them.

So we've got some work to do. It's not a tough process as we have mirror image wills. With that our wills read the same, just with different names in the blanks. The fist time through, deciding what to do with our baby was the toughest part. We had come to a good conclusion and it had worked out quite well. But will we keep it the same?

We have some work to do, but it's not that tough. We get our templates from US Legal Forms and have found them to be a good product at a fair price. Add a /dave to that address and you can get the Dave Ramsey discount. We partially chose to go the DIY route as we had considerable difficulties in finding a lawyer who would actually spend time on this. Every one we contacted wanted to send us a form to fill out and mail back. And then charge us $400! We get the same thing here for $40 - or less!

What will be the toughest decision in filling out your will(s)?

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NtJS Mailbag - Mr Credit Card, Again

It's likely that many of you missed our first Mailbag post with Mr. Credit Card back in March. He had contacted us for a survey he was doing about credit cards:

"Mr Credit Card here. I am conducting a survey among personal finance, investment
bloggers about their credit cards and would appreciate if you would participate
in this survey. I would compile the results and publish it in my blog

FYI - I will not reveal your individual answers."

We seemed like an odd choice to complete such a survey, and we still feel that way. We answered his questions and even went so far as to post our answers ourselves.

Today, we found this in our inbox:
"Mr Credit Card here. During March and April, I sent out an email to do a
credit card survey. In fact, I sent out to over 150 pf bloggers. 45 of you
have responded to the survey and I want to thank all of you for that.
I want to thank you all once again. In return for participating in this
survey, I will mention your blogs in a special post tomorrow (hint : it's
not just a post full of links)."
I reviewed his survey results, and I really don't agree.

So much so that I posted a comment to that affect. I'm not trying to piss on his parade, but the results and conclusions seem terribly biased and self-fulfilling. Not that this was supposedly independent, un-biased, or done by a third-party, but I would recommend that next time. My comment below:

"Mr. Credit Card-

I have to speak up and say that I take issue on a few points here…

1> Under “How Many Credit Cards do you have?”, zero is not an option? So for folks who have none, were those results thrown out? It’s ok if they were, but that should be noted.

2> Under “Executive Summary”, maybe the intent is correct but not the wording. You note that “Most PF bloggers who carry a balance and have credit card debt take advantage of 0% APR teaser deals to help them lower their interest cost.” By my count, your chart shows 6 with 0% and 8 with an APR > 0. 0% is the most in one category, but not the majority overall, which seems more important here. In fact, you show 4 bloggers carrying a balance with an APR 10% or more, which seems like a much more interesting finding.

3> Also under “Executive Summary”, you note that “…most only carry two credit cards and do not go crazy over having many credit cards.” The second part of that statement is an opinion, and doesn’t belong there. Two cards IS crazy to me, let alone 3 or 4. Once again, 2 credit cards is the most of any one category, but the majority actually have 3 or more. In fact, the amount that have 2 cards is equal to the amount that have 4 to 10 cards. Also where is the line of having gone “crazy over having many credit cards”? 3? 4? 10?

In light of those things, I’m really not sure that I understand the main conclusion of “…from this survey is that most pf bloggers make good use of their credit cards and could teach us a thing or two about credit cards.”
Maybe I just look at the results differently."

I tried to be nice about it. I'm reminded of when our then Governor was re-elected with 38% of the vote. Yes, he received the most votes of any candidate, but his statement later that, "the people have spoken and made their choice", got to me. The people had spoken all right - and 62% said, "Not you!" Thus, if someone were to make a statement like, "most people chose this candidate", it would be equally inaccurate.

Oh, well.

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What Is: The Smartest Advice You Ever Got

CNN money has a montage of 40 people (rather well-known folks, like Derek Jeter) sharing the smartest advice they ever got. As you mights expect, these have to do with money, so "brush your teeth" isn't going to show up here.

I'm still working through all 40 as it is quite a bit to churn through. They are interesting to read. Every athlete and celeb should take to heart Derek Jeter's advice of, "Know where your money is going". Even if you aren't doing the day-to-day handling of it, know what is going on. There is a long line of folks who didn't do that, and are flat broke, despite the millions they earned in their hay-day.

All of this lead me to think about what is the smartest advice I ever got? Certainly, "get out of debt and stay out of debt" from Dave Ramsey would rank highly, but I didn't want to settle for that since I didn't receive it directly from Dave, but rather via video (and audio, and print). It really doesn't fit with the spirit of the article.

After some thinking, I came up with a real gem.

I recall riding in the car with my father one day. He was in real estate, and seemed to know everything about most of the homes in our town. We drove slowly through a few neighborhoods while he pointed out houses, talking about who lived there, what it was worth, and how big some of their loans were. It wasn't braggy or preachy, more a matter-of-fact sort of way. Honestly, I have no idea what we were really doing that day, or why I was with him on this little tour. I was young, but I suppose old enough in my father's eyes to get a few lessons on money and mortgages. Apparently he was right, as I can recount this to you so many years later.

"That's where Chris and his mom live. You know that was the third time I'd sold that house? His mother borrowed 98% on it. This one, so-and-so's used to live there. After she passed and he went to the nursing home, their kids sold it and that's when Cathy and Frank bought it. They borrowed 103%. ...." This continued on for a while - longer than I appreciated at the time.

Now I understood the confidentiality of these sort of things, and my father knew that I wasn't about to go around spouting all of this off. We were taught that early in life as people can be quite nosy.

I remembered asking, "How do you borrow 103% on a house?" "Well... ", he began, "you can borrow 100%, that usually means that you don't have any money. If you have no down payment, then you have to borrow all of it. Some folks will go a step further and borrow 102%, 103%, some banks will even loan you 105% sometimes. Now sometimes that extra amount is to make some repairs or upgrades or something dumb like putting in a pool, but usually they have other debt that they are rolling into that loan." As that sank in, I replied, "That sounds dumb". He smiled, "Yeah. More so for the banks, because if the owners lose their jobs and can't pay the note, then the bank can get stuck with a house that doesn't cover the debt. A lot of banks won't do those, that's why they had to go to Such-n-such Federal. I can't believe they are doing those."

"Really", he continued, "If you can't put 10% down then you're not ready to buy the house. Ideally, you'll want to put down more like 20%. The more you put down, the lower your payment. Also, the ability to put more down makes you less of a risk" We went from talking about folks who couldn't put anything down to putting 10-20% down.

With the current state of the US housing market, my fathers wisdom is fully realized. We put 10% down on our first home. The second time around, we put 20% down (yay, no PMI!).

What is the smartest advice you ever got, directly, pertaining to money?

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Carnivals / Festivals

Last week we were completely absent from the Carnival / Festival circuit with the exception of hosting the Carnival of Debt Reduction - Gazelle Intense Edition. This week we are back with a vengeance and have been included on five carnivals and festivals.

We are pleased to welcome all new readers, as well as new carnivals to Not the Jet Set. To find out more about us, click here. We are a personal finance blog focused on frugality, stewardship, and current events, while also telling our story as a family and the personal finance decisions we have made. Thanks for stopping by and be sure to check out our new NtJS Cafepress shop! On with the round up...

We'll root, root, root for the home team with the Baseball themed edition of the Carnival of Personal Finance is up at Taking Charge. Included is our non-baseball themed post on our cash envelope system. Here are a few other solid base hits:

Almost Frugal is hosting the 69th Carnival of Money Stories and taking us on a tour of France. I hope we can stop for crepes as well as some of our peach sherbet. For those of you who parle vous:

The Festival of Frugality is hosted at Antishay Ventenne with her "Frugal All Over" Edition and features our post about an accidental cooking success. Some other frugal favorites:

The 73rd Make It From Scratch! Carnival is hosted by Stop The Ride! and is themed after the county fair. I never found food at the county fair anywhere near as delicious as our peach sherbet. Watch your step around the livestock and don't miss these notable posts:

The Carnival of Debt Reduction is up at American Consumer News with the Secret to Life Edition. It's no secret though that Senator Clinton's campaign owes Senator Clinton 20 million dollars - maybe the two groups need some advice. These posts may not be the secret to life, but you may find them particularly enlightening:

Thanks for reading and thanks to all the hosts. Don't forget to tell your friends and subscribe to get updates via email or RSS.

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Baby Cheepskate Contest

Want to try that cloth diapering thing that we talk so much about? Think they are too expensive? Here is your chance to score 12 Bum Genius One size diapers. Retail value of $200!

Baby Cheapskate Giveaway
via Money-Hacks

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Dumpster Diving Etiquette

Everyday, on my way to and from work, there are piles of stuff sitting on the curb at various locations on my route. I sometimes wonder how some of these places are constantly amassing such piles of stuff. Furniture, toys, books, TVs, raw materials, you-name-it. Occasionally I'll see something of interest. My instinct is to stop and take a look. At least slow down and rubber neck a bit.

It's a habit I developed several years ago, living in a different area. You can only watch a certain amount of perfectly good stuff go to the landfill before you swallow your pride, and 'dumpster dive'. Now this rarely involved actual dumpsters, though those can be quite the treasure trove and quite dangerous. Usually just stuff leaned up against the trash can, awaiting the weekly trash service.

Why not? They don't want it. I could use it. Why let it got to the landfill and go buy new just because I'm too full of myself to take something from someone's trash pile?

Still, I was discrete about it - likely that no one ever noticed. In our previous locale, people left for work between 6 and 7:15AM. Since I left around 7:30-7:45, I had quite the pick of the litter, so to speak. Then there were the bits put out the night before. Anything is possible under cover of the night.

Now, in a less urban community, I'm less sure of my methods. The etiquette is different here, and in some areas on my way to work, I'm not sure that it's done at all. At least I'm not quite ready to find out. Still figuring it out.

What is the dumpster diving etiquette in your area?
What are some of your greatest finds?
Are you still to timid to attempt it?

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Why Do You Not Have A Will?

I know that this is a topic that most people avoid. I mean seriously... who wants to talk about death? Personally the thought of losing Mr. NtJS makes it hard for me to breath and my eyes well up in less then 30 seconds of the first thought. How could I even think about losing him?

The first step is to realize that if you really do love your spouse, kids, pets, and extended family and friends, then you need a will. It does not matter if you are rich or broke. You need a will.

Getting a will together is not as daunting of a task as one might think. If you are like most people, and are not super rich, a basic will you find online for your specific state should work just fine. Now, if you are rich or have a very complicated estate plan you would like to set up then please do seek advise from a professional. The online wills are basic word docs that you fill in the blanks for things like your name, who gets the money, who gets the kids, etc. Then you just print it, take it along with two witnesses to a notary to sign it. The witnesses can be anyone, a couple coworkers or neighbors work just fine.

You never know when you and your loved ones might be in a car accident or have a brain aneurysm at a young age. The last thing you want is for your grieving family to fight over who raises your kids or where to bury you. Just let them grieve in peace.

We've seen numbers all over the board here - 40%, 70% - the fact is that far too many people die without a will. If you fall into this group (those without a will), here is what will happen to your possessions:

  1. Spouse with rights of survivorship receive joint property (real-estate, bank accounts), decedents divide up other property. -OR-
  2. Your state of residence takes over via intestate succession laws - those vary from state to state.
Some folks argue that you don't need a will and that these laws will automatically do what you would have already done. Lets assume for just a minute that your state government is intelligent, well run and that the folks handling this stuff actually do it according to the law. Is that how you want your possessions divided? According to the default laws of where you happen to live? Also, after the all state-determined heirs, unclaimed property goes to .... ta-daaaa - The State! Not your favorite charity, not your friends, not your poker buddies - The State. I'll take a wild guess that very very very few people, if given a choice (and you do have a choice), would leave ANYTHING to the state. So maybe relying on these laws would fall under 'bad ideas'. See the map at the bottom of this page from CCH to see the laws in your area. AARP also discusses how many folks just assume that everything goes to the surviving spouse. Again, not the case.

Now while you are making that will, the other document that you need is a living will (also known as an advance healthcare directive). Who should get to say if Terri Schivo lives or dies? Her husband? Her parents? The State of Florida? How about none of the above. If you remember this well publicized ordeal from a few years ago, you'll recall people from across the country weighing in on this one. Its none of their business. Or at least it shouldn't have been. Terry and her husband made it everyone's business by NOT filling out a living will. Had they have done this, you would have likely never heard the name "Terri Schivo". A living will simply states your wishes, and the course of treatment you would prefer if you are unable to do so due to illness or injury. Everyone needs one of these. Or else, it could be you being kept alive by machines with friends, family, politicians and legal analysts arguing over whether to pull the plug or not. Not a pretty picture.

Why have you not done this? What is stopping you from doing this?

We filled ours out a few years ago, but we have a confession to make. Check in next week to see what it is.

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Hosting Carnivals / Festivals

Stop the press and hold the phone! Not the Jet Set . net will be hosting the August 4th edition of the Green It! carnival.

Get your posts submitted via Blog Carnival, and keep in mind that this one is super-selective about what gets published. Only the fifteen best and brightest and greenest will be included.

Submit your entries HERE

This weeks carnival will have the theme of Frugal Green: how living green can save you money.

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Celebrate Independence From Disposable Diapers

We recently spent some time away - away from work, away from chores, away from the blog (did you notice?). We went back to basics and went camping. Unfortunately, we did not have access to laundry facilities, nor enough cloth diapers to sustain us. What to do?

After much fretting and gnashing of teeth, we gave in. We bought disposable diapers.

(I can't believe I just typed that)

After the jump, the rest of our tale and a special offer.

Yes, you read right. We temporarily used disposies. We were not happy about it, but couldn't see ourselves washing cloth diapers in the river. We picked up a couple different kinds. 365 at Whole Foods, and Natural Choice at Meijer. We thought that both would give us the environmental friendliness we were after as well as the baby friendliness. No harsh chemicals, easily biodegradable. By the end of the trip - and several times in-between - we were reminded of why we hated using disposable diapers in the first place. They suck.

Leaks, leaks everywhere. Blowouts here and there. They just don't work well. We survived it - barely. At least baby's skin came out with nary a rash. The 365 brand wipes helped with that as well.

So we're back now, and thankfully have baby back in cloth. So as we (re) celebrate our independence from disposable diapers, we invite you to do the same. For the rest of July, and August, our cloth diapering spreadsheet is available for download - for FREE.

NtJS Cloth Diapering Spreadsheet - Download now!
(file info here)

So did we totally wus out by going back to disposables for the trip? If you were away for say... a week, how would you handle it with cloth?

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A Frugal Summer Treat

What at first I thought was a peachy failure turned out to be a new family favorite. I'm sure I'm not the only frugal mama out there who cans and freezes fresh fruits and veggies every year to save some $. Sometimes when I try some new techniques or recipes they don't always go so well. One of those times involved peaches. I blanched my peaches, skinned, and pitted them. Then I packed them into quart sized freezer bags with extra peach juice to fill up the air space. Well.... a couple months later I went to thaw a bag and all I found was mushy peaches. Now they tasted good, and where safe to eat. If anyone to could handle the thin texture.

I was so ticked at myself for ruining all these peaches - wasting my time and my money! You can ask Mr. NtJS about it, but I can be really hard on myself at times. But the farmgirl in me would not let me throw them away since they were safe to eat. The question was what to do with all these bags of frozen mushy peaches?

After some thinking I decided that they would be great for anything I would puree. That is when I found a basic but great peach sherbet recipe. After cutting back the amount of sugar it called for, I found a great summer time treat that our family and friends love.

Peach Sherbet
(makes 1 gallon)

  • 2 quart bags of frozen mushy (LOL) peaches
  • 2 cups of sugar

Puree peaches and sugar until smooth. Put in ice cream maker and make per their instructions. Check for your ice cream maker's manual online if you can't find it.

If you don't have bags of mushy peaches laying (like most folks) then you could use 2 quarts of fresh peaches, a tablespoon of lemon juice and then just add peach juice as needed during the pureeing.

I hope your family enjoys this summer time treat!

If you have a similar food mishap made right please share with us as I'm always looking for ways to salvage my mistakes.

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Carnival of Debt Reduction - Gazelle Intense Edition

Not the Jet Set is pleased to host the Gazelle Intense Edition of the Carnival of Debt Reduction (aka: #148). Welcome. If you are new here, then take some time to find out more about us and check out out latest and greatest articles. Don't forget to add us to your subscription list - RSS and email options are on the right. On with the Carnival!

It was 3 and a half years ago that we began our journey towards debt freedom and 2 years ago that we completed our debt-snowball. During that time, we also helped other families begin their journey. It always held true that those most successful were the ones that got serious about it - they did not go about it casually. They got mad at their debt. They got sick of their old habits. They got fed up with their credit card companies. They got gazelle intense. They paid off their debt - some of them in months instead of years.

Proverbs 6:4-5 (NKJV)

Give no sleep to your eyes, Nor slumber to your eyelids. Deliver yourself like a gazelle from the hand of the hunter, And like a bird from the hand of the fowler.

This week's Gazelles (Editor's Picks):
Others on the savanna:

Thanks for reading, and thanks to all the bloggers for these posts.

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The HDTV Challenge - Update 3

Another update, but this one with some actual news! We've made progress on our goal of $1400 (a liberal estimate), and as they say, "when it rains, it pours". Our previous HDTV fund balance was $376. We've added to that:

  • $200 from the proceeds of our garage sale.
  • $224 from items sold on ebay
  • ~$200 from a bonus check
So, after several months of little to no progress, other than being patient and sticking to our commitment, we've really gotten it in gear. The bonus check has not come in yet, so I'm not sure what I'll see of it after taxes. Should be at least $200. For now, we'll leave that out of the totals.
  • previous balance = $376
  • current balance = $800
It's not been fast, but I'm very satisfied with amassing $800 over 6 months by simply selling things we already owned.

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Used Cars: We Bought, We Sold, We Conquered

So we discussed, at length, the ins and outs of buying and selling used cars. So what? Well, every bit of those articles is gleaned from the processes we went through in selling one of our cars and buying a used truck. We're not going to claim to be experts on the topic, but who is, really? We chose to share this information because it is what we did, and both transactions went extremely well, with the exception of a couple forgotten garage remotes (Don't forget those!!). Lots of pundits will tell you to buy a used car instead of new, but they rarely help navigate you through that process. We hope that we have helped fill that gap.

So how did we come out? First we sold the car I was driving. My commute was quite short. While I loved the car I was driving, and it was quite efficient, We just didn't need two small cars. We needed more utility as we were constantly renting or borrowing trucks to haul stuff. One of the two cars had to go, and 'my' car got the ax.

  • We posted the ad on no-charge want ads first, like craigslist. After a week, we paid for a newspaper ad. Both types brought in leads, but the eventual buyer came from craigslist.
  • Since our car was in pristine order and below average on miles, we asked for top dollar - full private-party, excellent-condition value. $10,200
  • Three weeks after the initial post, our car was sold - at full asking price. They could not find a single reason to discount our asking price.
  • The final transaction went down at the buyer's credit union. We had the title (since we'd paid it off 6 months prior), and the check came straight from the Credit Union. We had all of the necessary paperwork and everything went extremely smooth. Both parties drove away happy.
Since we had started shopping for trucks 3-4 weeks prior, we were poised to buy as soon as that car sold, and the check was cashed.
  • As soon as we got home, we check the latest listings, double checked the old ones, and started making calls and sending emails. We had our top 2 lined up for test drives, and were waiting to hear back on our back ups.
  • The first was at a dealer and was a total bust. The ad totally misrepresented the vehicle, and the salesman repeatedly lied to our face. A second vehicle that they showed us was in fair condition, but way over-priced.
  • The second truck tested very well, and was at a very fair price. It was everything we needed and then some. We bought it for cash on the spot. Once again, we had all the needed paperwork with us. The seller had the title and since we had just gone through the process of transferring one title, we knew how to do this one.
  • To be fair, despite flashing the cash, the seller did not budge on the price. They had already dropped it from the original $8500 to $8000 (which we knew), and wouldn't take less. That was fine with us - $8,000 was slightly under value for it's condition. We still reaped the benefit of doing the deal on the spot, with no delays.
  • For those of you doing the math: 10,200 - 8,000 = 2,200. That difference left us money for TT&L as well as unforeseen repairs. We certainly could have paired the $10,200 up with some saved cash to move up in vehicle, but why? Here it was unnecessary. We bought that truck for work, not show.
  • Once again, all parties came away happy with the deal.
Now just some fun facts to sum things up.
  • We bought and sold these vehicles through craigslist
  • The truck did need a repair - to the tune of $900! Good thing we had some room in the deal to do that. We still came out ~$800 ahead after that expense and TT&L.
  • We sold our car on Friday, and bought the truck on Sunday. Since we were well prepared, one of us didn't have to go without a vehicle.
Do you have used car buying/selling experience to share?

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Fast Cash

As you already have figured out we don't believe in get rich quick schemes. However, sometimes a person needs cash fast for whatever reason. What are the ways to come up with money when you don't have a Rich Uncle Pennybags to call on?

  • Garage sale - price the junk, put out the signs, and lets have a sale! Most of us have plenty of things that we can do with out that will bring in some needed cash. Start scouting things up and collecting them in one spot. You may be surprised by how much you have. Some years back, at our first garage sale, we made over $300. We looked back and said, "What did we sell!?". It adds up fast.

  • ebay/craigslist - Not much for tables and crowds at 7 am? Try selling via the electronic garage sale that is the internet. Potentially wider audience here, but with less interaction with the customers.
  • Donate fluids - Blood, plasma, sperm. There is a market for each, though the latter two pay better.
  • Second jobs - Some positions are always in demand and if part of the pay is in tips, then we have a winner! Waiters/waitresses and pizza delivery drivers are good examples.
  • Self-employ - This doesn't even have to be so rigid as starting your own business. Talk to your friend down the block with 6 kids. Tell her you're looking to make some extra cash on the side and would like to know if you can clean her house once a week. While you're at it, offer to babysit. Look for neighbors that could use some help cutting the grass (these aren't tough to spot). There are plenty of ways to fill up your free time that earns you some fast cash.
For every good way of coming up with quick cash, there is an equal but opposite bad way of coming up with money. Not good ideas:
  • Payday loans - Hoping this is obviously bad, but maybe it's not? These guys are legalized loan sharks. You've seen them in the news lately where the effective APR on the money loaned is something like 800%! They also trap you in a cycle of dependence that is tough to escape. Bad, bad, bad.
  • Pawn shops - Not a bad place to buy stuff, but if you are looking for top dollar for your stuff, you won't get it here. Just like any retailer, they have to buy stuff at wholesale prices to sell it at retail and turn a profit. You're looking to sell at retail direct to customers. Just cut these guys out by using ebay or craigslist.
  • Used book or game stores - These places may seem more favorable than an actual pawn shop, but you'll find the end result to be quite similar.
  • Gambling - Really? Do we need to start/encourage another bad habit? Especially one involving money? Some folks do walk out of casinos with some quick cash and they are very rare and very lucky. 99% of the time, these places will take you in the opposite direction of where you are looking to go.
  • Credit and debt - A very easy and very tempting way to get needed funds, and one that we will not endorse. If you are in this financial position, then it is very likely that you won't be able to pay the credit card company either. See you didn't solve anything by using debt, you just moved who you pay the bill to, and possibly bought yourself more time. Though now you are banking on being able to pay later, which is similar to the bad idea just above - gambling. Debt is the last thing you need in an emergency and that includes hitting up friends or relatives. You'll quickly understand what the phrase, "the borrower is slave to the lender" means.
How have you gotten your hands on fast cash in the past? Looking back, would you put it in the 'good idea' bucket or the 'bad idea' bucket?

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Hosting Carnivals / Festivals

Mark your calendar and save the date: Not the Jet Set . net will be hosting the July 14th edition of the Carnival of Debt Reduction!

Get your entries submitted via Blog Carnival ASAP! (or before the deadline, whatever)

Our theme for this edition will reflect one of the most important concepts that helped us get out of debt 2 years ago - Gazelle Intensity!

(That Tony Little guy sure was intense)

The Carnival of Debt Reduction homepage

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Our Cash Envelope System

When we started on the Baby Steps all those years ago, one thing we resisted was switching to cash only. Our debit cards were so convenient, so easy. How could we give that up? Plus, when I had cash in my wallet, it had a tendency to disappear - a Coke here, lunch out there, a new shirt there, another Coke.... how could that be a better way?

I've been reading more and more lately about envelope systems, and people seem to be quite confused about what it is, how it works, and that it does work. At least I hope they're confused, otherwise why make such dumb comments?

Well, we toughed it out on debit cards for quite a while, and though we were able to monitor our spending quite closely, it was still just too easy to bust the budget and overspend - even by a little. The biggest problem was that you didn't know what you had left unless you went and did all the math before hand - which no one does. Mostly you'd end up doing it after the fact, just to find that you'd inadvertently overspent. Eventually we knew we had to do something different.

While listening to Dave one day, he was discussing the envelope system and how they did it. Initially they were strictly cash. But as they got better about their spending, they limited the cash to just a few categories. That made a lot of sense to us, and since we were not doing that bad on spending, we took the half-plunge. We tried cash on just a few categories and found it worked quite well. We still used debit for gas, still payed utilities online, but things like eating out, clothing, and spending money were all cash. And what a difference that made.

Sometime later, when we thought we had our spending down to a science, we went back to plastic. I think it was more laziness than anything. If we could succeed without that extra step of drawing cash out each month, then why not? Well, we couldn't. Cash was just a better way, for certain categories. Before going over just how we do our envelopes, I'll give a quick framework for the envelope system:

  1. We are done with debt - we don't need it, and that includes credit cards.
  2. Debit cards, while not incurring debt, can still enable overspending, which is the root of the problem at hand.
  3. Sticking a wad of cash in your wallet does not constitute "switching to cash". That's like embarking on a cross-country trip with no map or directions. You are set up to fail, maybe not catastrophically, but you're not in a position to win. This is about behavior change - you can't go about your day the way you used to and get the same result.
  4. This can be done, even when there is more than one of you doing some of the spending, but it will take time to find the right formula for you.
So knowing all of that, here is the system that we have laid out and currently use.
  1. Budget - It all starts here. What are we spending this month and where? If we are traveling, then the restaurant category will be a bit higher, and groceries a bit lower. If you have your budgeting down, then envelopes should go smooth.
  2. Cash - What will we need cash for? For us, we do groceries, restaurants, home improvement, and clothing as well as baby sitter money, and petty cash as needed. We chose these as they are the easiest to overspend on, or ones that we just need cash for - the babysitter doesn't have a card swipe!
  3. Withdrawal - Once that paycheck hits, the Mrs. makes a withdrawal and sorts the cash into their envelopes. These days, she's using a small accordion file, that keeps it all neatly organized.
  4. Distribute - One she has the cash, I get my allotment. Since she does the grocery shopping, and most of the shopping in general, I don't carry much cash.... since I don't need much cash. I usually just have a bit of cash for a couple lunches out. I only carry what I'll need. Money we won't need that day stays at home.
  5. Spending - Cash envelopes are sometimes seen as being more difficult, but that is due to overlooking their simplicity. It's easy to know what you have left, in any category, at any time with no guesswork, no reconciling, no fancy software. Open the envelope and count. That is what you have left. When it's gone, it's gone. When you have extra, reward yourself.
It's really not tough, and only serves to increase discipline as opposed to plastic, which has nothing to do with discipline. But it's only as good as your budget, so make sure you get that working right. Sure we still use our debit cards for things like gas, hair cuts, vet bills, and on-line shopping. Those are places where we don't tend to overspend, and using cash would really have no benefit. Utility bills, medical bills, insurance premiums, and the mortgage are either paid online or with a check.

Last, the most absurd objection to using cash is that it's "a burden to carry cash" / "too dangerous and I could get mugged". Seriously? Some cheese with that whine? How on Earth is cash difficult? If having a plan, budgeting, and not shopping on a whim is a burden, then yes, guilty as charged. And dangerous? If you're going to get mugged, then you are going to get mugged - no matter what is in your wallet. Maybe worry more about not making yourself a target? Nobody said you have to carry all of the cash all of the time either. You know when you are going grocery shopping. Otherwise, don't take the grocery envelope. Now stop making excuses, and take control!

Have you ever tried cash envelopes? With or without a plan?

How are your envelopes set up?

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Carnivals / Festivals

We've been busy this week - making a few updates here and there. We are also featured on five carnivals/festivals this week! This will be a shortened roundup, but be sure to take a few minutes to see all the great articles these carnivals have to offer.

We are pleased to welcome all new readers, as well as new carnivals to Not the Jet Set. To find out more about us, click here. We are a personal finance blog focused on frugality, stewardship, and current events, while also telling our story as a family and the personal finance decisions we have made. Thanks for stopping by and be sure to check out our new NtJS Cafepress shop!

The 146th edition of the Carnival of Debt Reduction is up at Destroy Debt. This, their 'Financial Independence Day' edition features our post about our Financial Independence Day. We recommend:

The Carnival of Personal Finance is up at Greener Pastures, and features our tale of a friend switching from plastic to cash.

This week's Carnival of Money Stories is posted at My Good Cents. Included, all the way at the bottom, is what we have learned about money from car magazines.

The June 28th edition of the Carnival of Financial Planning has posted at the Skilled Investor. Here you'll find our post about a friend curbing their spending by switching from plastic to cash.

We've been included on the 5th Carnival of Financial Learning with our post on financial learnings from automotive magazines.

Thanks for reading and thanks to all the hosts. Don't forget to tell your friends and subscribe to get updates via email or RSS.

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Credit Cards Are Like Fireworks

They've been likened to alcohol, guns and all sorts of things - some condemning, some encouraging, some indifferent. But as the 4th of July approaches, we've taken a slightly different view of these little plastic devils. Here is our list of seven eight reasons why credit cards are like fireworks:

  1. Anyone can get them - They aren't hard to get. Very little is required - no special certification, just a pulse (though they'll overlook that from time to time). A flash of an ID at most.
  2. They seem harmless. - There is no shortage of folks telling you how great they are, how they do it all the time and never have any problems. When everything goes OK, they are great. But all it take is one mis-fire and everything turns sour fast.
  3. What a great deal! - They sucker you in with a deal to good to pass up. Credit cards offering sweet, sweet rewards / Fireworks being sold as 'Buy one, Get 6 Free'. How could you go wrong?
  4. They can go off unexpectedly in your hand! - Whether your in the back yard or waling through the mall, either one of these can get you in the blink of an eye. Maybe it was your fault, maybe not.
  5. Parents shouldn't give them to kids. - Sure, they seem like fun for the whole family, but giving these to the kids and sending them out into the world is a recipe for disaster. More than likely, they will learn some lessons the very hard way.
  6. Mistakes happen. - Even those who were being 'responsible' can slip up from time to time. Neither of these two are terribly forgiving. Will it harm your pocket book, or your vision?
  7. They can be done safely. - Many people claim to be so careful as to never be in the line of fire - and I've seen it done. Yes, it is possible. Professionals put on extravagant displays year in and year out without incident. Then again, they are professionals -it's what they do. Maybe that's how you'd like to spend your time? Us? We've got better things to do.
  8. BONUS: You don't need them! - Opting out does not diminish your stature or put you at any disadvantage. In fact, you'll likely find that your life is just that much more simple.

Now on a serious note: It's great to stop and take time to honor our country - to reflect on those who founded it, and those who defend it. Take a moment to think about our freedoms: Use them, but don't abuse them. Have a safe and happy 4th. Be smart: Do yourself a favor and leave the fireworks (and the credit cards) to someone else.

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Whatever Is Next: A Double Dose

It's getting deep already with not one but two developments on this front. We start with an oldie, but a goodie from CitiGroup. Last year, when the heat was on about Universal Default, the folks down at Citi thought that they could gain advantage in the marketplace by not screwing their customers via a Universal Defaul policy. What an idea! Earlier this year, when things got hot and heavy in DC, Citi came out smelling like a rose by stating that they had stopped beating their wife using Universal Default and jacking customer's rates up for no reason, and everyone else hadn't. Thus their "a deal is a deal" pledge/promise/ad campagin/bold-face-lie.

Well, you can't find too much info on those policies on Citi's website... because they are reconsidering them! Turns out that a deal is not a deal after all (at least in South Dakota), and perhaps that little slogan has done it's job by winning over several lawmakers. But it has failed to win over customers. I guess their deal didn't work out so well outside of Washington. Oh well. Back to screwing over consumers!

So what else is next? Well, I'm glad you asked! Delta will now start charging you to use those "free" SkyMiles that you've been racking up on their AmEx card. They've called this a 'fuel surcharge', but take it for what it is - another fee. This could be a precursor - a small hole in the leave, resulting in a tidal wave of other cards charging to access those lush rewards that have you all worked into a froth. We haven't seen this... yet. Be forewarned - the seal has been broken. In an economy where many are less and less able to pay on their debts, lenders are looking for sweet, sweet profits wherever they can find them. Even if that means cutting into your sweet, sweet rewards. US Airways (are they still in business?) and American Airlines have already started charging processing fees on those so-called "free" tickets. Who's next?

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