New England Blizzard

Every job has its perks.  These perks range from employee discounts to overtime/bonus pay to “borrowing” office supplies.  It’s important to become familiar with those perks and take advantage of them, because they will save you money.  I travel occasionally for work, and one of the perks of my job is that I can tack on personal vacation to these trips, have the travel department change my flight schedule, and only be responsible for the difference in cost.  My company has a active recruiting presence on most major college campuses, so another perk is that I can volunteer to man our booth at career fairs all over the US.  I graduated from Syracuse University, so when I discovered they were having such an event in February I naturally volunteered.  I still have some friends in grad school there, and also saw an opportunity for me to add on some vacation days to visit a friend in Boston and a relative in Portsmouth.  I had never been to either of these cities before and looked forward to spending a good portion of my time off exploring them.

I told the travel department that my inbound flight was fine, but could they please extend my rental car and change my return flight to be out of Logan airport in Boston 8 days later?  Logan is more connected than the Syracuse airport (Hancock) so those tickets turned out to be cheaper, and I only had to pay about $400 for the rental car for the extra days.  This sounds expensive, and it is, but after completely researching all of my options including buses and/or Amtrak I decided that the cost was still comparable and the extra freedom of the rental car was desirable.  With local connections in each of my destinations, I managed to avoid hotel fees completely and limited my parking expenses to under $50 which includes parking in downtown Boston and an overnight stay in a Portsmouth garage during Winter Storm Nemo (3 feet of snow in 36 hours!).  I gifted each of my hosts with a gourmet mustard to show my appreciation for their hospitality.

Boston is a really cool city!  You can walk along the entire Freedom Trail in just one day.  Following this double-wide red brick line inlaid in the sidewalks will take you to all of the important landmarks you might wish you see.  I also had fun wandering around the Boston Commons and Beacon Hill areas.  As I explored Boston, I kept encountering opportunities to save money!  I slipped into a tour group at the public library (not sure if the tour was free or not), took advantage of free chowdah samples in Quincy Market, and soaked in the history of one of America’s oldest cities without needing to buy overpriced admission tickets or souvenirs.  There was one free model ship exhibit near the USS Constitution (Old Ironsides) where I chatted for a while with a member of the Boston Model Ship-Building Guild.

Portsmouth, NH was fun too.  I got to see tugboats and tankers loading and unloading, and the Naval shipyard on the Maine side of the river.  I saw old churches and crypts right up against one of the main streets.  The beauty of this vacation was that I was having the time of my life just walking around looking at things.

I haven’t gotten my travel reimbursement back yet (it usually takes a couple of weeks) but I estimate that I spent under $600 of my own money on the whole 8-day trip.  Not the cheapest vacation but not bad either, and I had a blast!

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Taxes, and why you shouldn’t pay others to help you pay them

My parents did my taxes until I graduated college.  As I result I missed out on a lot of important tax-related financial lessons until well into my young adulthood.  Every year I got an income tax refund check or two, and failed to grasp that this was an adjustment made to the amount that was already being withheld from each of my paychecks.  The first time I owed more than I had paid throughout the year, I felt betrayed!  With a full-time job and few deductibles, I could no longer rely on what I had come to think of as my annual tax bonus.

When I first started doing my own taxes an online product called TurboTax was recommended to me.  By asking you a series of questions, the program fills out your tax forms (the scary, dense, official tax forms) automatically, and even submits them for you.  When you have figured out your adjustment there is even an online payment/direct deposit option that is extremely convenient.

One of the best things about this product is that you can use it to do your federal income tax adjustment for free!  Many alternatives (like H&R Block which my girlfriend used this year for her federal taxes) are also usually free for filing your federal returns.  They are a great way to help you learn more about how taxes work at no cost to you!

To do your state taxes for free, you will need to do a little more legwork.  The appropriate forms for your state are usually available online or in your local public library (another great resource) and can often be submitted electronically also.  Although filling out these forms yourself can seem intimidating, I am about to share with you my method for making it much more manageable.

TurboTax only charges you for filing your state returns at the moment of filing.  You can go through the question/answer process for practice, for free.  This is almost like having an application wizard (remember the Microsoft Office paperclip?) guiding you through the entire process.  By doing this and filling out the official state form yourself at the same time, you can save yourself the $30 TurboTax fee without sacrificing the ease of use that the flowsheet-style approach offers.  Another advantage is that you can answer the questions differently if you’re not sure about something and get your estimated refund updated in real-time.

That is the approach that I used this year, and I’m done with taxes before February is halfway over!  Combining both my federal and state tax adjustment I just barely made money back, and I am not ready to give it away so casually for somebody else to do what I can do for free.  Don’t be like Homer Simpson.  Do your taxes early, be informed, and you’ll learn not to dread this time of year but instead to treat it as an opportunity to learn more about your finances and steer yourself into early retirement.

EOM January 2013

EOM = End Of Month.  Most organizations have their accounting department perform an EOM balancing process, and I have acquired the same habit.  Although on average I update my personal spreadsheet about weekly with data on individual transactions, every 1st of the month I enjoy tying everything up and adding another data point to my favorite graphs (which are mostly plotted monthly).  These graphs help tell the story of my life as it unfolds: the journey of the green pilgrim.

I am also able to add two other important data sets (for the month to come) at this time: my paycheck, and my rent.  This works out nicely for me.  Because I add my monthly income on the 1st (before I have opportunities to spend any of it) my savings rate starts at 100% and then decreases with each expenditure.  The added pain of knowing that an action (usually a purchase) will decrease this number for the current month gives me pause and makes it easier for me to save.

My savings rate this month was 78%!  This is higher than my savings rate for 2012 (67%) but lower than my goal for 2013 of 85%.

Jan2013 savings rate

One major reason I failed to meet my goal this month is that I bought a brand-new $300 cell phone!  I allowed myself this expense because I know it will save me money in the long run.  By buying a new, unlocked smartphone I can continue taking advantage of all that fun functionality at a fraction of the price of my previous monthly bill.  Even accounting for the capital cost, this will save just over $600 more in 2013 than if I had continued my service with Verizon.

Another reason I fell short was that I spent more than my average in the entertainment category this month.  I attribute this entirely to splurging on tickets to see a live show (of course I paid for my date; just because you’re saving money doesn’t mean you have to be cheap).  Dan Harmon (creator of the TV show Community) was in town recording his podcast, and the small intimate theater led to some very funny and personal interactions with the audience.  You can listen to it here, for free!  My favorite part was watching this Milwaukee native reunite with his old high school buddies for a live session of D&D.

In other spending categories I outdid myself.  Most notably, I managed to limit myself to spending under $20 on alcohol for the entire month!  Here is a better picture of my expense profile for select categories:

Jan2013 expenses

Those are the numbers.  I can’t stress enough how much logging and graphing this information helps me make better informed decisions that are in line with my long-term goals.  Happy February, and good luck on your own green pilgrimage!