I do often use this blog to remind myself what my plans are. It can be helpful to look back months later to see what I did as well. This post is about how I plan to handle the tuition bill due Sept 12.
The total bill is $7,198.55. The housing portion is $5,154.55. The tuition portion is $2,044.00. The housing portion will come from our daughter's Education Savings Account (ESA) which is currently invested in mutual fund. The remainder is coming from savings/current cash.
I could pay $20 a semester to divide this bill into three equal payments. But that's just more outflow that I don't think is necessary. Initially, I'm simply going to transfer the full payment from our savings. We have quite a bit of cash in our emergency fund and from the proceeds of two homes.
The goal is then to pay ourselves back before the end of the year. We are adjusting our withholding to 18 (yes, that is not a typo) to have no Federal withholding for the remainder of the year. This will increase my husband's paychecks by $259.36. There are 8 paychecks remaining for 2015. This will result in $2,074.88 back into our savings account. Notice that is just over the amount of fall tuition. Because we are paying this tuition out of pocket we can claim it on our taxes with the American Opportunity Tax Credit.
The housing portion needs to come from our daughter's ESA account in order to pay ourselves back. Since the market is crazy, I'm not going to withdraw the full amount right now. Instead I'm going to withdraw in three equal portions of $1718. Currently I plan to wait to see if the market stabilizes a bit more later in September, but worse case wait until mid to late October to make the first withdrawal.
That's the plan. I think it is a pretty good one, too. No student loans, yet! Would you do anything different?
Archive for August, 2015
I do often use this blog to remind myself what my plans are. It can be helpful to look back months later to see what I did as well. This post is about how I plan to handle the tuition bill due Sept 12.
We downloaded YNAB this weekend. I've taken one class and entered in some things (primarily savings pots that already exist in our checking account). Tomorrow is payday so seems a good day to start using it! I think initially I'm going to be entering things the old way in my spreadsheet to make sure it is lining up with what I expect YNAB to do.
My husband and I did sit down last night for a discussion. He is now aware of our total cash savings, the current amount on credit cards (not paying any interest), the net income, our expenses and how much we are saving annually for retirement. He seemed very pleased to know all the details. He was a bit surprised that there wasn't as much extra as he thought. He admitted to spending thinking that with his raise there is a lot of extra. There really is plenty. To me, it's about not wasting the extra on lunches out. We need to make sure we are accomplishing what we want with our money.
It was a good start. We didn't make any decisions on buying anything new. No changes have been made to anything yet, which is fine. We'll get where we want to go soon.
The first month of YNAB will be interesting as I'm not entirely sure how much we spend on groceries or gas each month. I will do my best to make an educated guess. The nice thing is I do know how to save cash for non monthly expenses, such as an insurance bill. I already have that part of the budget figured out....well for some things. I'd like to do this for more items as we move forward.
What do you like best about using YNAB? Did anyone try using it and then give up?
We seem to be making a mental list of things we want to buy. We don't have the cash to buy it all before the end of the year.. At least I don't think so. Tuition is a factor. That's part of the process we are starting on. Making the list, prioritizing and then making a plan/budget on how to acquire these things.
So here's the list at the moment:
A treadmill (more need than want)
A computer or tablet (not a need)
Two chairs for our living room
Lamps and table for living room
Seems there may be something else, but this is where we are starting. I do realize used are possibilities and that a tablet is cheaper than a computer in most cases.
I really think we are going to start using YNAB (You Need A Budget). At least I have suggested it to my husband. I think a budget on things like eating out and alcohol expenses would help both of us keep these to a minimum.
I'm excited at the possibility of working together on some of these goals. I don't know that it will go super smooth since I do tend to work on everything on my own. I expect I will still do the nitty gritty detail work on our finances, but talking a bit more and making some decisions together will be good.
Oh, and a reminder to myself we also need to figure in some airline tickets for our daughter to fly home and maybe for us to visit family. We live so much farther away from family than before we have not had a budget for travel expenses.
I now have more information about the costs of tuition this semester, what can be claimed for the American Opportunity tax credit and how it will impact our taxes owed. And the good news is we will owe less in taxes as a result!
The bad news(good news?) is we have already had too much tax withheld to cover our taxes. A whopping $1775. Yes, most people rejoice at such things praising the government for providing them a tax refund. Unfortunately, I blame myself. I actually increased our tax withholding to compensate for the fact that we would no longer be able to claim the child tax credit (of $1000) for our oldest daughter and my husbands increase in pay. I didn't take the time to figure out about the college credits available and how that would impact our taxes. Oops!
The good news is I have changed our withholding to 10 for the time being. In order to avoid any more withholding we need to claim 18! My husband will need to do this in person, as I can't change the amount higher than 10 online. Once it is changed to 18 his monthly paychecks will be $518 larger! Money that I plan to set aside for the tuition bill in February.
Of course, I will need to change the withholding in January to make sure we do have money withheld in 2016! I haven't figured the correct amount to withhold right now, but trust me I will do a better job this year in getting it right. I will have more clear information this time around.
Do you know where you stand on your withholding and taxes owed for 2015? Is it possible you need to make changes due to a change in circumstances? Do you prefer a refund or just to owe a little on your tax return?
My daughter had two good days of high school. So far so good. She can tell a lot of kids are connected to the military, since the teacher asked them to introduce themselves and say where they were born and where they have lived. That is a much better question than 'Where are you from?'. Do you have any idea how hard it is to answer that question? At least simply?
With the start of school I can feel myself getting back into routines. Laundry is getting done on a schedule. Dinner is at a decent hour. And so is getting to bed.
We still need to get the spending under control. Some of it has been unavoidable. I thought I would go to the grocery store today, but upon looking around in the kitchen I had asparagus, couscous and chicken. Sounded like dinner to me! Tomorrow I think I can skate by again without going to the store. I have some frozen fish sticks that if we don't eat...will never get eaten. Not sure why we bought them, other than they must have sounded good during one of the trips where we didn't have a list. What we don't have are too many fresh vegetables...and I'm craving some greens. I think I will pick those up and see if we can last through Saturday for groceries.
One reason I'm trying to control the groceries is because I spent more money today. Cat food for the next two months $40, a $20 flute repair (that's cheap!), and $10 worth of personal spending (socks and a pair of sunglasses). The socks and sunglasses really were needs. The elastic in the socks are becoming too loose and uncomfortable to wear. The sunglasses are to replace a pair I lost at Universal earlier this month. Pretty good deal to get both for $10.48.
If we have the food, we really don't need to grocery shop anyway!! I really hope the spending is slowing down.
My youngest daughter(10th grade) started her new high school today. I'm nervous right along with her. She was going to take the bus, but there didn't seem to be anyone at our stop, so I drove her. Which is fine, I have no problem with that at all. It just added to the nerves of the day.
I'm more nervous for her than my college daughter! I guess because high school can be so tough. She is already involved with the marching bad, so may have seen a few familiar faces once she was there. It's a big high school of nearly 2000 kids. She had a hard transition last time we moved, although didn't really know the full extent at the time. I'm just hoping this is better and easier!! This school is used to lots of new kids in all grades because we are near a military post. I'm crossing my fingers that is a positive thing!!
Financially, we spent a lot more money again yesterday. My college daughter bought $160 in art supplies for one class! I paid her back. I also ordered two more things on Amazon for her, which cost $37.
Later in the day, I took my youngest clothes shopping. We spent $82 during that trip. I ordered a pair of shoes online for $55, and then a used scientific calculator for $70!
Did you add that up? $374. In one day! The money is flowing out. I'm trying really hard not to find other reasons of my own to spend. With a new home to live in, it is so tempting. So far so good though!
I received the $25 Visa Gift card from US Bank in the mail Saturday. This was a perk for redeeming more than $100 in rewards at one time, which I did less than two weeks ago. I'm glad it came fast!
I'm thinking I will go purchase two different gift cards for my college daughter with it. A food one and likely iTunes. I figure she would like to get some fun mail. And she has mentioned many times this summer she wished she had an iTunes gift card. Of course, she had plenty of cash to buy iTunes. Smart girl just didn't want to spend her own money!
I think I mentioned before that many (but probably not all) of my future snowflakes will help supplement college life!
So...I know about the American Opportunity Tax credit. It seems it doesn't cover room and board. It does cover tuition, fees and books...after scholarships. For this semester alone we have $2100 towards those costs.
If I understand correctly, I can claim tuition paid in the first three months of 2016 on our 2015 return. This means probably another $2K of expenses. So around $4k that we will pay from sources that are not college savings plans. My understanding is if I take this money from our Coverdell ESA those expense covered with this money can not be claimed for a credit. Which is fine with me since I currently plan to use that money for room and board, which I can't claim for the AO credit.
Then my understanding is the first 2K in expenses is a 100% credit. The next $2K is applied at 25% for a maximum of $2500.
Since this is a credit, it will directly impact our taxes owed. Currently I have us withholding about $520 per month for taxes. I think this is slightly more than our taxes before this credit. Now I'm debating about changing our withholding knowing this new information. If I reduce it, then I can save it for the next tuition bill in February. Or I could keep withholding the same and get a big refund, which I could then use to pay back the tuition we pay in February. I making an assumption that I wouldn't have the IRS refund by the Feb 12 due date.
Am I making any sense? Any other guidance? The credit is nearly always better than a deduction, so I'm not even looking at that scenario.
My daughter and I talked today on the phone. She finally has internet access in her room, and wireless access all over campus. It was a hard week without it, but she made it. Class start Monday, so she is all set now.
Since she could log in online she took a look at her billing statement. Tuition, fees, room and board for the first semester AFTER scholarships is $7,198.55. Scholarships amounted to $10,000. Room and board is the largest portion at $5,145.55. The tuition/fees for 18 hours came $2,044. Living ON campus is required for Freshman under the age of 19.
The bill hasn't actually been generated yet. The first bill is due September 12. I can pay in full with a debit card or check for no additional fees. If I use a credit card they add a 2.75% convenience charge. I can also make three payments, but need to sign up each semester for a $20 fee.
It's tempting to do payments, but I'm not sure it is absolutely necessary. I will be using her college funds to pay at least $5K. I would like to pay the remainder out of some of our savings and cash flow the remaining. It's the willingness to cash flow some of it that makes me interested in making payments.
I haven't thought it through much more than what I've written here. I will take a look at balances and see what I can do by September 12. I'm grateful for the scholarships and ability to pay this bill without student loans. So grateful!
Anyone else sending a child to college this semester? How much is your first semester bill?
And now our water bill is high! But we figured out that one. There is a sprinkler head that is broken, so for about 5 minutes a day it is like turning the hose on full blast! And our new shower has all these shower heads...which my husband likes to use. More water than needed for a shower! I think he's stopped that for now.
We turned off the sprinkler in that zone as we were told the owners didn't use it because the neighbors sprinklers actually get that area from runoff. It's unfortunate we didn't notice it sooner. It's hard to catch when it is running at 5am.
The high bill could also be an issue of estimating our first bill (just a week's worth). But I feel more confident this one will be easier to get a handle on.
Really bad timing to have all these high bills while adding on college expenses. So far it seems to be working out okay though.
In addition to dealing with getting my daughter ready for college this month and having visitors, I found out my Kohl's card had been used for a purchase.
I have no idea how that happened. First, I was notified of an email change, but was having issues getting it corrected. Initially it didn't look like anything had been charged so I ignored it since I was so busy! While I was away my husband asked me about a package. Jeans? That I didn't order. Until I was home did I realize they were boy's jeans!
I called Kohl's. They confirmed my account, apologized, credited the shipping charge and offered to pick up the jeans. I figured on my end it would actually be easier to return to the store, since I know I will be there this week. They also set up a password on my account that needs to be used in order to use the card in the store or online.
I need to look around on our credit report to check on other accounts and possibly set up a fraud alert to prevent other accounts from being opened in my name. I'm also overdue from changing passwords on some of accounts. I need to get to that too.
The charge was only around $30, but so odd. Kohl's? It's not like that card can be used any other place!
Geez! It has been hot here since we moved in, but didn't expect this large of an electric bill. It's $301.03!!
It did include about $45 worth of first time fees. Plus a few other 'taxes' amounting to $10. Even so that is an expensive bill.
I'm sure having the door open all day on moving day had that air conditioner working hard. And then were other trips in and out. I think we need to increase the temperature a bit and see if we can stand it higher. I know it is lower than we had at our old home. Size wise it is about the same.
I put it on the Chase Freedom card for the rewards and once it posts I'm paying it in full with funds from our August 15 paycheck.
Moving forward...and hoping we can adjust the bill down significantly for next month!
We use our credit cards all the time and then pay balances off in full if on a interest bearing card. We have been rolling some over lately on a 0% card. I made some more payments and feeling much more current than I did last week.
Last week our balance was over $4K. Tonight after more payments were made we are down to $2,942.25. So progress! Found $14.11 in snowflakes to apply to debt in the process.
I have cash set aside to pay another $1,383 on the credit cards, but I'm waiting for a couple statements to close. There may be rewards I can apply, so I'm waiting for now. It does seem the revolving balance I don't seem to get paid off is about $1600! Ugh. Of course, I won't let them charge me a penny of interest. I will have to pay it in full by the end of October. Or the statement due date right after. I need to look back at my notes on that one.
In other news, I've lost about 6 pounds in the last two weeks. I'm watching my calories as best I can, cut back on diet soda (only one or none). I did a ton of campus walking this weekend in addition to all that walking while we were in Orlando earlier in the month. I still need to get into some sort of fitness routine. We are actually considering a treadmill...but I need this debt paid off first.
Do you own an exercise machine? Do you use it?
I'm back from taking my daughter to college. It was emotional. I was more sad initially, then it was her turn. She did turn a corner though and seemed pretty good when I left. She made the marching band!!! She is now super busy the next several days with that, which makes it hard to figure out getting her computer and phone set up on the University's WiFi. She thought she was connected last night then said it didn't seem so this morning.
She already has a bit of homework. Needs to find time to practice for her concert band audition next Tuesday. Luckily she did practice nearly everyday this summer. She is busy, which is probably better than being bored.
I know I spent nearly $100 at the bookstore for new t shirts and sweatshirts for our family. The books she rented were $190. I guess one was purchased, since it was available for rent. There may be cheaper options in the future, but this time we just went with the local bookstore. Luckily I checked the receipt before we left. Originally it said books needed to be returned Oct 23...before the semester is over. It was a cashier error. Now they are all due back December 18. We would have been charged the difference and then would have owned those books! Glad it happened as it was a good lesson for my daughter to witness.
I know I probably spent another $300-350 once we were in town on dorm needs. It sure adds up! Hopefully, many of these things can be used over and over in the coming years. I know I still had dorm items when my girls were younger! I maybe still do.
I need to get back on track with bill paying. There was a payday since I was out of town. I have many emails from credit cards about statements being available. My goal for today is to get that completed.
There's more to write about, but for now I need to keep getting the important things done!
We have quite a few credit cards that we now use for various types of rewards. Specifically I have balances on ten, ranging from $13.43 to $1,549.07. The total balance of those ten all together is $4,155.65. These are all current and not charging us any interest. And you might notice that is less than the last time I reported our total.
Today I made a list of the balances of each card in order of due date. I usually don't pay much attention because I just pay off the balances when we get paid. If you are paying on current charges twice a month you are always ahead of the statement closing. That's why I haven't paid attention.
As I said in the other post about our credit card debt, I plan to pay all of these off without any interest. But I also want to keep as much in savings as I can. So I'm going to aware of the due date so I'm paying the debts due first FIRST with current paycheck money rather than those due a month out or the next paycheck.
This probably isn't a big relation to anyone, or me for that matter, but I'm just taking a different approach for a bit. A little more awareness to get on an even footing again and hopefully with a nice healthy savings account.
Of course, there is the college expenses. I'm going to try to cash flow as much as I can. However, whatever I can't can be paid with funds saved for college. At least for this year. We have tuition mostly covered, but the dorm will be our biggest expense. Along with some miscellaneous band expenses which seems to be extra time in the dorm and food before the housing contract starts. Next year, I will plan to save up for this little extra cost.
Are you aware of your debt due dates, or do you pay more attention to which paycheck you pay your debt from?
I mentioned that I closed our US Bank Checking account last week. I already have confirmation in the mail that it was closed.
Tonight, I redeemed $106.02 in rewards on my US Bank Cash+ Visa. I put it as a statement credit towards the balance (the rug we bought a couple weeks ago). Because I redeemed more than $100, I will receive a $25 Visa in the mail (approximately six weeks). This is the last time this card is offering this extra bonus. I think I got it one other time. I still like this card though since I can get a 5% rebate on our cellular bill every month!
This is considered a snowflake to me. I'm still tracking them, just have been slower in the last two months. I'm also just putting the money towards our recent moving/college/trip expenses. I might have a fun goal to track them towards starting in September or October.
I also added $15 from Pinecone Surveys and $14.72 in interest and atm rebates from our bank to the August snowflake total.
Are you keeping track of your snowflakes? Are you putting them towards debt or another goal?
Eek! We are just days away from flying my daughter to college. We have a big list of things to buy when we arrive, but need to pack here first. Suitcases are lining the hallway. We have the next few days to get things packed. If it gets to be too much to take with checked bags, then we may need to mail some things. We sent a few things with family that just left today.
It's pretty overwhelming for all of us it seems. Today we are getting her meningitis vaccination taken care of and likely a little clothes shopping. Tomorrow more packing since we need to know by Wednesday morning if we need to mail anything.
In other news, I redeemed Pinecone Points for $15 Paypal cash. I think I will have that tomorrow if I remember right.
I'm guessing I won't be posting much in the next week with all the activity, but eventually I'll get back to my regular updates about our goals.
I closed the US Bank Checking account and associated debit this week. I hadn't been using it for quite a few months. I also only opened it to earn a cash reward. I think it was $150, maybe $200. I was able to easily cancel it using their online messaging system. Now I just have their Cash+ Visa which I use every month to charge our Verizon cellular bill on to get 5% cash back.
It feels good to get rid of one more account. I need to do some more pairing down on other accounts again soon.
I have company through Monday, so I'm not posting much this week.
So for full disclosure I'm putting how much we have currently on credit cards. A whopping $5,161.22! I know. That is a lot. None of it has been charged any interest. We have either paid the balance in full before the due date or let the balance roll over on the one 0% interest card we have, Citi Thank You Premiere. And yes, that card does have the largest balance at $2,585.67.
The good news is I have $3,441 that I have decided I can pull out of savings and start paying these balances down/off. I also have a $100+ reward from US Bank to apply to a balance as well. That leaves $1,620.22 to pay off. Some of that will come from current money in our checking account to cover purchases included in the total that are current purchases and bills. That accounts for at least $300, maybe a little more.
I'm pretty sure I can get the remaining carryover balance paid off in the next month, by the September 1 paycheck. Of course, I could pay the whole thing off and just pay ourselves back too. I am considering that also.
And yes, a big chunk of that balance is our trip. I said I would use some extra Army funds and house proceeds and that's what I'm doing. Off to pay off some more debt!
Our trip to Universal Orlando did cost a bit more than I expected, but I have no regrets. We had a very good time with plenty of memories!
Here's the approximate breakdown of costs:
Airline Fees $144
Park Tickets $604
Hotel Cost $695
Hotel Parking $52
Rental Car $191
Airport Parking $42
Grand Total $2396
We did Early Bird Check in for Southwest on both legs of the trip, which added $100 to our cost. It was worth it leaving, but on the way home our flight probably only had 60 people, so need for it. But you don't know that ahead of time.
Hotel costs could have been much less, however, we did get Express Passes included to cover all three days for four people even though we only stay two nights for that cost. (Third night at different hotel was paid with reward points) If we had purchased Express Passes (Unlimited version) for three days for four people it would have cost us over $1400! That is not a typo. There is no way I would have paid that, which is why staying on site is such a deal even though the cost of the hotel seems pricey it isn't for what you get.
I mentioned the rental car issue in yesterday's post. Originally I though I was getting a rental car 'free' with reward points.
Of course, we could have limited souvenirs, of which there really were only six or seven items. My husband had some pricey beer. We did eat Clif Bars in our hotel room each morning so that saved us a bit, but if we wanted food in the parks we ate it. I tried Earl Grey and Lavender ice cream, which was yummy! With it being so hot, water was probably our biggest expense. I didn't have time to do enough research, but we could have refilled our water bottles with water at the Coke Freestyle machines for FREE! Oops. Lesson learned for next time!
So it's all good. I'm using a little bit of our house proceeds and army reimbursements to pay for the trip.
Transportation on our trip was more than planned. It seems I thought I had reserved a rental car using Southwest Rapid Reward points. However, when I went to double check all of our reservations I couldn't find the rental car, only an email stating I had redeemed a reward. It seems the reward I redeemed is a voucher for Dollar Rent a Car that was mailed to me (well mailed to my old address). I still have yet to receive it.
So less than 24 hours before we needed a rental car I was on the hunt, using every rental car company and coupon codes I could come up with to find the least expensive option for us. We really wanted to pick up our car at the airport rather than a shuttle (this does increase the cost). We also wanted a reliable company (some companies have terrible reviews). We went through USAA and got a mid size car for $191 prepaid with Budget. It was definitely more than I wanted to pay. Later my husband asked about other options to get to the resort since we barely needed the car. Shuttle service or Luxury Town car round trip for four people would have been at least $144. It turns out we did leave the hotel resort area one night for dinner and stopped to get something at Walgreen's. We also used the car to get to our hotel for our third night's stay closer to the airport. This stay was at a Fairfield Inn and we used reward points. Staying at the resort would have cost us over $300 for a third night. Oh, and we also ate at a restaurant on our last night and we drove there.
So the rental car wasn't a bad deal considering how we used it to save us a little money. It just cost me much more because I originally thought I was getting a rental car for free! Well, I am getting a 'free' rental car but not for this trip.
We paid $20 per night to park on site at our resort hotel. That fee was expected since I was planning on a rental car. We would have saved that fee had we not rented a car.
And finally, we parked at the airport for $12 a day. Our parking tab was $42. Again, we could reduced that amount in half if we had parked off site. We ran into backed up traffic on our way to the airport and decided it was better to just pay the higher cost of parking than be late for our flight.
So it is what it is! I think in the end it worked out fine for why we rented a car and what the alternatives would have been. At least the airline tickets didn't cost us anything out of pocket!