Should We Spend Our Child's Money

Should We Spend Our Child’s Money?

How many of you live a distance from your loved ones? If you are a military family, most likely, you do not spend many holidays and birthdays with your extended family.

Do you have nieces, nephews, or grandchildren who you would love to give a small gift from time to time. But can not justify spending $20 in postage to send a $10 gift. Me too!!!

So when our little one received his first cash gift for Easter I wasn’t entirely surprised. I get it. Shipping can be ridiculous! Plus standing in the dreadful line at the post office. No thank you!

Which leads me to my question for you…

should we spend our childs money (3)

Should We Spend Our Child’s Money?

If you have children too young to express what they want to buy.

Do you buy something your child “needs”? Do you save it for college? Do you save it for when they are older and can decide what to do with it for themselves? Do you try to purchase something that you believe the giver intended?   

The Dilemma  

I know this cash gift shouldn’t leave me scratching my head. But it most certainly has been on my mind more than it should. Here we are months after Easter and the cash is still sitting on the fireplace mantle.

I know most parents would not even think about a $5, $10, or $20 cash gift to their child. For some reason, both my husband and I view spending our child’s money as a big decision. As with any big decision, we have weighed our options.

Buying Something Our Child Needs

Our baby boy is not quite 3 months old yet. His “needs” are very basic. Food, shelter, and love… check, check and check.

Clothes? Thanks to our EXTREMELY generous family and friends he is set for clothing until he is 3 years old!!!

Diapers? Yes. We could always use more diapers. However, poo-ing on a gift and throwing it in the garbage just doesn’t seem quite right. Am I wrong?  😉 LOL.

Save

We could place the gift in college savings. However, we have not started saving for his college at this point and this gift is not enough to get a fund started.

We could let it sit in a savings account (or piggy bank) until we have a better plan or our little one is old enough to tell us what he wants to do with it. However, we worry that we will forget about it and it will be shuffled with other money.

Giver’s Intended Use

The giver in our situation gave no indication how they intended the money to be used. So we attempted to put ourselves in their shoes. We believe if they would have given our little one an Easter present that was not money it would have been most likely a toy or clothes.

So do we buy a toy that will only be played with for a month or so and then be placed in a box for three months during our move? Plus he’s only 3 months old. The couple of toys he has keeps him entertained.

Our Decision

After thinking about this for way too long, we are leaning towards saving the cash gift until we are in Hawaii. We will then buy him a toy. He will be just shy of 6 months old and will be far more interested in toys at this point. 

Bonus for us… we will need a distraction for him while we attempt unpacking in our next home! A new toy hopefully does the trick.

 

What Do You Think:

Do You Spend Your Children’s Cash Gifts?
If You Do, What do You Buy? How Do You Decide?

 


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may Military Family's Budget

A Military Family’s One Income Budget – May 2016

I can’t believe we are down to our last few budgets of dealing with two currencies. I’m sure budgeting will be a piece of cake after we move to Hawaii. Ha! Only one can hope. There always seems to be “surprise” expenses that make budgeting challenging.

Military Family Budget Meeting

My husband and I have a budget meeting before the beginning of each month to hash out our budget. Even if he is deployed, half way across the world. We still have our budget meetings via a phone call or some type of technology. After four years of budget meetings, we can cover everything financially related and be in 100% agreement in about 10 minutes.

Trust me. It was NOT always this painless.

The Purpose of Sharing our Budget:

We share our budget with the hope to encourage and inspire our readers who are on their journeys to financial freedom. We share our budget with the hope that it opens up a financial conversation, to create an opportunity to learn from each other.

Background

If you are new to Budget Loving Military Wife, you may be wondering a little bit about our situation. We have been seriously focused on our finances, getting out of debt, and budgeting for four and half years!

My husband serves in the U.S. military and we have been stationed in England since 2013. We began our marriage with two good incomes, which was extremely helpful to pay off our consumer debt. However, our England move made us a single-income household.

We are debt free besides our mortgage (stateside home that is currently a rental property). We have three month old baby boy! We also recently found out we are moving to Hawaii this summer!

Our financial focus while living in England has been to pay down our mortgage as quickly as possible and to take advantage of our once in a lifetime opportunity to travel Europe.

may Budget

One Income Budget

Income

Husband’s Income – $6539.78

This is total take home pay for April. We budget and live on last month’s income. Our income is in US Dollars, but most of our expenses are in British Pounds. For simplicity sake, we budget everything in US Dollars (using current exchange rates).

Current Exchange Rate: 1 British Pound = 1.44 US Dollar 

Living Expenses 

Rent – $1728

Our overseas housing allowance is £1350 (~$1920). However, the overseas housing policy is “use or lose.” The ~$200 difference is “forfeited” by us. I mention this because in state-side locations, if you rent a home for less than your housing allowance you get to keep the difference. If we were not forced to forfeit the difference. We would definitely find a place less expensive, to apply more towards our debt.

Electricity/Gas- $86.40

This bill is the same every month, although fluctuates with the currency exchange rate. Our service provider sets a monthly price based on our estimated future use. Every six months it is re-evaluated and our monthly bill changes accordingly.

Water- $0

This is a quarterly bill, which is typically ~$120-$180. June will be our next bill.

Garbage- $57.60

Our community’s garbage, recycling, and yard waste was paid by taxes. However, they began charging for yard waste. This is a annual fee. It’s a bummer since we will only be using this service ~3 times before we move. Oh well, at least it’s not a much higher cost.

Grocery- $240

We had $14 left from last month. We will be rolling it over to May, creating a total grocery budget of $254. Our grocery budget pays for all food and household supplies (as well as diapers).

Car Repair/Replacement- $0

This fund covers all car maintenance and repairs. Our car fund currently sits at $1722.29. We will be selling our British car in the next month. This fund will be plenty to keep the car maintained and running during this time. Any left over money after we sell the car, will then be applied to buying a car in our new location.

Gasoline- $200

We purchase most of our gasoline on the military base for a much lower price. On the British economy gasoline is ~$7/gallon.

Renter’s & Car Insurance- $50

We only cover liability insurance on our car that is worth less than $2000. Otherwise car insurance is quite a bit more expensive in England than in the U.S.

Dental Insurance- $11.68

This covers my dental insurance. My husband’s is 100% covered by his employer.

Baby- $0

Majority of our baby expenses come out of our grocery fund (diapers) and miscellaneous fund (unexpected fees or medicine, etc.). Our baby budget currently sits at $50.00. I will be updating our$1000 Baby Budget to reflect all the purchases made since our little one was born.

Total Living Expenses: $2373.68  (36.3% of Total Budget)

 

“Luxury” Expenses

Phones- $115.20

This is for our two smart phones. One has international calling.

Internet- $27.36

This may seem low for internet service. However, we pay an annual fee (nearly $300) for a land-line rental in order to have internet service. If you break it down, it would be roughly $50/month for internet.

Miscellaneous– $88.80

We had $28.80 left over from March’s budget. We are rolling it over to have a total $117.60 for May. This fund picks up random $5-$20 expenses that we did not foresee or helps cover categories we go slightly over budget.

Blow Money- $20/$68.80

This covers all of our individual purchases. Clothes, Haircuts, Make up, Lunch with Friends, Snacks/Coffee, etc. We “allow” a maximum of $75 each per month, however we try to keep this expense as low as possible.

Restaurant- $28.80

We had $57.60 left over from last month which we will roll over to May’s budget for a total of $86.40. We budgeted a bit more this month so we can go out to a Mother’s Day lunch and a birthday meal for me.

Vacation Fund- $0

We are done vacationing while living in Europe. :(

We will be visiting family this summer and autumn. We are budgeting these expenses with our PCS budget.

Total “Luxury” Expenses = $348.96   (5.3% of Total Budget)

Work & Education Expenses

Husband’s Work- $20

My husband is required to go out to lunch with some high ranking head honchos this month. At the very least we knew about it in advance. Typically these expenses come out of our miscellaneous fund because my husband isn’t typically informed until the week or two prior.

Husband’s College- $0

My husband is taking a break from college courses until we are settled in Hawaii.

Total Work & Education Expenses: $20   (0.3%)

Investments – $722.46

We have selected to invest in Roth investments because our taxable income is currently very low. We would rather pay taxes now, rather than paying taxes when we are retired millionaires. 😉 We invest approximately 10% of our gross income.

Total Retirement Investments: $722.46   (11.0%)

Savings

PCS Fund- $1500  

After May we will have $6000 in our PCS (military move) fund. Our goals is to save $1500/month through July for a total of $9000.

Total Savings: $1500 (22.9% of Total Budget)

 

Debt Payments

Mortgage- $1544.73   (23.6% of Total Budget)

As promised, our mortgage payments will be much smaller for the next few months because we are saving for our upcoming move back to the U.S.

This budgeted amount plus what we receive in rent from our current renters and any “extra” we can scrape up with extra income or lower than budgeted expenses will be our June Mortgage payment. This includes insurance and taxes for this property. Check out our most current Mortgage Freedom progress!

 

***Please remember I am only sharing our budget to learn from each other. It is no attempt to make anyone feel sorry for us or to brag in anyway. I would love to hear your tips or what you would do differently if you were in our shoes. I am all about making our budget better and more efficient. :)

What do You Think?

How was your May Budget Meeting?
Trying anything new with your budget this month?
What would you change about our budget?

 


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The $1,000,000 Challenge: April Update

The Million Dollar Challenge – April 2016

The Million Dollar Challenge of 2016 has got off to an AMAZING start! This year we are set to dramatically change our finances! We have a goal of paying off, saving, and investing ONE MILLION DOLLARS!

If you would like to join the fifty-five courageous challengers who have taken on this challenge. Please Join HERE!

The Challengers

The majority of challengers are married and in their 20’s and 30’s. Most challengers started their financial journey within the past year and have a household income below $50,000 and a net worth below $50,000. If you are interested in learning more about the challengers, please check out “Meet the Challengers.”

April’s Getting to Know the Challengers Question:

If You Won $20,000. How would you spend it?

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April Update

Debt Paid Off

There were 22 challengers who reported debt paid off this month. Those 22 people, paid off…$31,492.73!!! Well done all you debt slayers!!! Keep up the amazing work! That is an average of $1431/person! In only four months, we have paid off an UNBELIEVABLE amount of debt. CONGRATS Challengers!

Total Debt Paid in 2016: $205,195.13

Allow your brain to wrap around that number. In most parts of the U.S. you can buy a home for $200K and in 4 short months we have paid off this amount of debt! Congrats! You all are so inspirational!

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Savings

There were 19 challengers who reported saving towards an emergency fund, vacation fund, or some other large purchase. Those 19 people, saved… $25,055.85!!! That’s an average of $1318/person!!! WOW!!! This is the MOST we have saved in a single month! Congrats to all you Super Savers!

Total Savings in 2016: $81,838.19

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Investments

There were 17 challengers who reported investing towards retirement, children’s college education, or other investment accounts. Those 17 people, invested… $10,869.72! 

Total Investments in 2016: $53,872.77

If we invested our total investments in 2016 for 30 years at 8 percent returns, we would end up with just shy of $600,000!!! Considering this is only 4 months worth of investments, that’s AMAZING! :)

image (26)

 

Total Progress for March: $67,418.30!!!

CONGRATS on an incredible April, Challengers!!! Each month I am blown away by how ~25 challengers can change their finances by SOOO much! Keep up the challenging but rewarding work!

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Total Progress in 2016: $340,906.09!!!

WOW!!! We are a third of the way into our challenge, which means we are on track to reach that ONE MILLION DOLLAR goal!!! The summer months are challenging, so dig deep. Stay on track and strive to reach those financial goals!!!

Thank you to all of you inspirational challengers who are changing your finances one day, one dollar at a time.

Facebook Group The $1000000 Challenge

Facebook

If you are a challenger or planning to become a challenger we would love for you to join our Facebook Community that is solely dedicated to The $1,000,000 Challenge. You will find inspiration and encouragement from your fellow challengers. Inspiring and informative articles. I also post “Questions of the Week” which if you answer, provides extra entries into the $100 Amazon Gift Card Giveaway!

2016 Million Dollar Challenge

The $1,000,000 Challenge of 2016

Are you inspired by the INCREDIBLE progress of these challengers? Are you ready to be the one who improves your finances by $10,000, $20,000 or do I dare say $50,000???

Are you ready to dramatically change your finances? If you are ready to join the challenge that will push you to PAY OFF MORE DEBT, SAVE MORE, and INVEST MORE than you EVER thought possible. I encourage you to make 2016 YOUR YEAR and Join The $1,000,000 Challenge TODAY! Plus this year, there is a $100 Amazon Gift Card up for grabs!

 


$100 Amazon Gift Card GIVEAWAY

  $100 Amazon Gift Card Giveaway




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May Mortgage 2016

Our Journey to Mortgage Freedom: May 2016

Happy Cinco de Mayo!
Yes, I’m a guilty American that uses this holiday as an excuse to drink tequila and eat Mexican food. LOL! Perhaps not this year… but next year, bring on the Margaritas and nachos! LOL.

I apologize for the extended absence. Little man is keeping me busy… good thing he’s a cutie. 😉

Budget Baby

I hope everyone had a wonderful April, full of financial progress!

Looking Back at April

As of April, our mortgage principal was $6,577.18! One of our 2016 Financial Goals is to PAY OFF THE MORTGAGE!!! I’m keeping my fingers crossed that we can pay it off before we leave England.

May 2016 Mortgage Freedom

 

May’s Journey to Mortgage Freedom Payment

Principal Reduction:

Normal Payment:      $620.81
Interest:                              $2.04
Road Tax:                      $213.36
Fuel:                                  $23.70

Extra from Budget:   $1088.13

Total Principal Payment: $1948.04!!!

Just shy of $2000 paid on our mortgage this month all while saving $1500 for our upcoming PCS (military move). Definitely something to celebrate!!! We paid about $300 more this month than we did last month.

Category Breakdown

Interest ($2.04): This was the monthly interest that accrued on our savings accounts (mostly from our emergency fund). Nothing to brag about, but every dollar counts!

-Road Tax ($213.36): We budgeted to pay 6 months of the British Road Tax. However, when we received the bill we realized it didn’t save us much to pay 6 months vs. a monthly (~$38/month). Plus this way we will not have to wait for a reimbursement when we sell our vehicle in the next month or two.

-Gasoline ($23.70): We budget $200/month for gasoline expenses. Last month we had a little extra left over and so we applied it to the mortgage!

Extra from Budget ($1088.13): We had a few less expenses last month and so this is a couple hundred dollars more than the previous month! Here is to hoping we can have a couple more similar payments in the upcoming months!

New Mortgage Principal… $4,629.14!!!

WOW!!! We have a mortgage less than $5000!!! In all honesty it is so difficult to wrap my brain around how little amount of debt we have left. For so many years we had HUGE numbers staring back at us. 

We could easily use some savings to pay it off. However, we are saving for our move. I can’t believe how close we are to DEBT FREEDOM!!! Two to four months remaining… CAN’T WAIT!!!

New Mortgage Statistics

Daily Interest: $0.60 ($0.26/day reduction!)

Our monthly interest is now $18! LESS THAN twenty dollars a MONTH! When we started paying off our debt, just over 4 years ago. We were paying $24 EVERY. DAY. in interest! Incredible!

Number of Years Extra Payments have Knocked Off Mortgage: 24.5 Years!!!

Minimum Payment Amortization: January 2017! 8 months left… even if for some reason we need to go back to paying minimum payments.

Our Journey to Mortgage Freedom Visual

Here is a breakdown of our  Month by Month Progress

MortgageApril2016-page0001

 

Looking Forward to June Mortgage Payment

Challenges:

  • Saving for PCS – We are saving $1500/month until ~July to pay for PCS (military move) expenses. This takes up a large portion of our “extra” income that has been previously applied to our mortgage payment.

Good News:

  • No Major Expenses as far as we can predict there shouldn’t be any BIG extra expenses this month.
  • Blog Income – I should have a small amount of blog income this month to apply to our mortgage in June. Every little bit helps! Thank you for your continued support!

Will We be Mortgage Free before Leaving England?

We will be moving from England to Hawaii this summer. We should have two more mortgage payments before moving. This means we would need to average a $2314/month principal payment on our mortgage. This would be $300+ more than May’s mortgage payment.

Considering these numbers, it will be EXTREMELY difficult to pay off our mortgage before leaving England. It appears we will be $700-$1000 short from paying off the mortgage. Considering these numbers, you better believe we will be scraping up any extra change and trying to trim down our PCS budget to find some “extra” money to PAY THE MORTGAGE OFF!!!

What do You Think?
Do you plan to pay off your mortgage early?
If you were in our shoes… would you pay the mortgage off now or wait to make sure you have plenty to cover our PCS move and have plenty in the event of an emergency.

 


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