I wrote a post about a woman thinking about selling her engagement ring.  It got some good comments and provoking thoughts.  One thought that stuck with me was people saying that it was materialistic to own the ring.  My take?  Is that she’s a great person and it’s something they could afford when they bought it.  They chose to spend their cash on it.  But she said it best “my priorities have changed and I want different things now.”

That struck a chord.  That no one is perfect financially.  We all make financial mistakes and the only thing we can do is work to rectify them.  We cannot go backwards and prevent the mistake from happening, but we can prevent it from happening again. Also we cannot predict what sort of situations we might find ourselves in financially in the future, we can only make choices based on the information we have right now.

I’ve made more than my fair share of stupid spending mistakes.  Buying a timeshare was a BIG one!  Using a cheap contractor instead of one more expensive!  Those are stuff I remember.  Not to mention I probably make decisions other would consider financial mistakes but I don’t.  Taking out student loans or car loans or a large mortgage or a adjustable rate mortgage!  But for me it makes sense and works.

I guess what I’m saying is if we are all not perfect and we all make mistakes, is it so wrong to lay it out there as a mistake and say you want to fix it?  Why judge the mistake?  If the person already realizes their own mistake does it really matter?  So for my friend she wants to sell her own engagement ring for her own reasons.  She’s acknowledged that she doesn’t want it because it means less now than it used to.  And it was a mistake in HER eyes to spend that much.  Now all I can do is weigh the pros and cons of her decision.  She can’t go back and say don’t have the big wedding or expensive ring.

Finally, whose to say that some people can’t afford the fancy wedding and expensive ring?

I was reading over the Money Crashers article about umbrella insurance and whether you should have it.  The author says that previously it could be called paranoia insurance, but nowadays without litigious society, it’s more like personal protection insurance.  I have to say I agree.  Now people sue one another over anything and everything.  With that being said, the author says if you don’t have a million bucks in the bank, then umbrella insurance isn’t necessary.

I personally have umbrella insurance. It costs us $270/year and yes we carry pretty hefty auto and home insurance. Why?  We aren’t millionaires.  We don’t drive ridiculously expensive cars.  And yes it costs an extra $270/year.  So why do it?  And yes we do need to carry higher auto and home insurance.

Because we live in a condo.  Some drunken partygoer could slip and fall on the ice on our property and as an association we’d be liable.  An accident could happen, a dog could bite, multiple incidents could happen on our “behalf” without our involvement.

In the future when we have a single family home we may reconsider our decision when we control our own destiny.  But then I look at the cost.  It’s $270/year for extra coverage above and beyond what we have.  We right now are doing decently well and we’re not millionaires or even close but we aren’t entirely in control of our destinies because of the situation we live in.  So for us it makes complete sense to buy umbrella insurance for peace of mind and also protection against other people’s stupidity.

An interesting survey done by ING Direct found that men found frugal women sexy, whereas woman found frugal men boring.  I find that very funny and true.  I mean let’s be honest here. I’ve blogged about it before that men are expected by society to “treat” women out on dates.  Men are expected to pay.  If a man doesn’t pay or the couple goes dutch the man is considered cheap and stingy.  I personally never allowed men to pay for the first few dates, I typically went dutch.  And I certainly did not consider men cheap.  Rather I found myself more self-confident and secure on the date.

Finding out that men find frugal women sexy makes me laugh.  I can now tease my DH that my traits are desirable. I’m an excellent money manager, I know how to invest, I budget, and I am frugal.  Does that mean he hit the trifecta?

I find it also true that women describe frugal as stingy more than men. I think a lot has to do with spending habits.  It’s hard for a man to go out on a date and then set a “budget”.  Say not ordering drinks, appetizer, or dessert as a means to save a few bucks.  But if a woman said that to the man he would likely be less offended.

Also men find financial issues more upsetting than personal issues while women are the opposite.  So women don’t mind debt as long as they are happy and secure in their personal lives.  But men are upset over debt and losing money even if they are happy.  However more than half of the people surveyed say that women are better money managers.  Interesting.  I used to think that but recently a lot of the women I’ve meet IRL have said it’s their husbands that do the money in their households.

So is it true? Do men find frugal sexy while women do not?

Many women in today’s society have engagement rings which are quite expensive.  Of course if they were to sell it they would not get what they paid for it.  However if absolutely necessary they could recoup some of the cost.  Why am I writing this?  Because a friend of mine was discussing with a few other moms whether or not she should sell her engagement ring.  She wanted to keep the wedding band, but hadn’t worn her engagement ring since getting pregnant and it didn’t fit anymore.  The ring was around $25k and she wondered if she could get a decent amount of money back, say $10k for the diamond?

Her reasoning was that she couldn’t believe they had spent that much money on a piece of jewelry.  She said that she had changed a lot since she had gotten the ring 5 years ago.  Back then she had thought she wanted a huge piece of “bling”.  She had actually demanded it.  But a lot had changed, she had changed.  Other things had become more important than keeping up with the Joneses.  She said that when she asked her husband for the ring, they were both working, older, and she valued the diamond.

Now five years later she valued her husband, home, and new baby.  Now she realized “omg the ring was as expensive as a new car!”  You can’t go back in time, but like she said if she could change things she would.

I find it amazing.  Amazing that I could meet someone who actually wants to, but doesn’t need to sell their engagement ring because they changed.  What they valued changed.  Not that they are in debt, not that they “need” to, but she’d rather spend the money on other things.  Besides, she could get cubic zirconia and who would know? Wow.  By the way I wear my cubic zirconia diamond earrings and get compliments for them!

I told her do it if she wanted, but don’t regret it.  Would I do it?  Probably not.  But I’m wearing I think a ring that is $1k, not $25k.  So the return is a lot different.  If I meet my DH now, we were established with savings, I don’t know if I would say no to an expensive ring.  I’d like to think not.

On the flip side I have a friend who just got engaged with the big, expensive diamond ring.  She is 32, planning a wedding for 2012, so she can have the splashy, expensive wedding.  Will she change her mind?  I don’t know.  But I wonder if people do have regrets?

Personally I have a modest ring, and I had a modest wedding, so I wouldn’t change a thing.  What do you think the mom should do?  Sell the engagement ring?  Keep it as a momento?

I was fascinated to read Dog’s take on a pre-nup as well as the comments on the link about a young man in his 20s asking if he should get a pre-nup?  R. May a commentor on Dog’s post said she would because it protects the lower wage earner as well as the breadwinner in many cases.  It may give the stay at home parent a set amount valuation of their “work” post-children versus fighting afterwards.  Or it might protect someone if they stand to inherit a lot of money.

But does it make sense?  Should people do it?  Dog says her views changed.

My thoughts are that it’s fine. I believe that there are many situations in which a prenup is absolutely essential.  First off if I were to be divorced or widowed, and decided to remarry I would get a prenup.  This way I would protect my interests and that of my child.  Second, I believe that talking about a prenup is a way for couples to get into the nitty, gritty details of their financial lives.

I don’t believe that financial lives need to be shared until people are in a serious, exclusive relationship.  You don’t need to be disclosing your financials on the first date.  Sorry but no.  It’s DATING.  Relationship definitely yes. I think when you are in relationship you begin to explore your values and ideas more in depth to find out if you really are compatible.

But the nitty gritty like I have saved X amount for Y years, and have $Z total dollars, perhaps that waits until you start talking MARRIAGE.  If you are in a relationship you should know if they like to spend money or save.  But you don’t have to reveal your budget to the penny.  However if you are “talking” future then yes it’s time.

I’m sure some readers are shocked.  But I also think that sometimes people rush into relationships and marriage without fully knowing the person or being ready for the situation.  I realized this after having a baby, that a lot of people get married and have kids fast when they are pressed for time.  And suddenly it’s like “wow I didn’t know that my husband wouldn’t be interested in coming home after work to see me and the baby, but would rather go to happy hour or to the gym.  Versus their priority is coming straight home to the baby…”

I’m not saying it’s wrong, but sometimes it takes time to fully know someone and their quirks.  I write this as I go on 10 years with my DH.  But we personally had no pre-nup because we had NO money.  We were broke and we built everything together.  We had no financials to share because pretty much every penny we saved we did together.

But if we hadn’t?  Or if we were now placed in the situation where I had all our assets and savings and no DH?  Trust me I’d have a couple million in the bank and you bet I’d be signing a prenup next time around.

But then I’m practical and not very romantic.

Since having a baby a few months ago I wish I had learned a few things sooner to save some bucks.  Granted some of the stuff I didn’t buy but still, I might have gotten it instead of what I have.  Also I’m not getting a kickback for any of these products, it’s just stuff I liked.

First off to save money people will try and use a convertible carseat from birth.  It can be a great savings, but only if your kid fits into to the seat.  My baby was too short at birth to fit.  At 6 months the shoulder straps are still a bit high.  At birth she was very short and chubby.  Another point is that her floppy head would not have been supported.  I understand if people buy it, but try to borrow an infant seat/bucket.  At 6 months my daughter still fits in her infant seat stretched out with her legs because she’s petite.  But she’s almost over the weight limit.  We actually borrowed our infant seat and are trading it back and forth with friends who are having kids on the opposite schedule as us.  Actually we’re swapping gear back and forth to save storage space and I’ll get my swing and bouncers back next year in time for our next child.

Second if I did buy an infant seat I’d buy a Graco carseat and the Mosaic stroller. It’s is a pretty lightweight umbrella style stroller that accepts infant carseats to snap in!  Fantastic.  Instead of the snap and go, get the Mosaic and you’re set with your lightweight stroller in the future. I have a chicco lightweight stroller, a safety first travel system, and a bob revolution jogging stroller.  The Graco car seat also snaps into the Bob stroller.

Third, don’t buy cloth diapers in bulk when starting out.  Buy one or two to test it out.  Turns out they don’t always fit properly and they can leak. It’s best to figure out which brand or type suits your child’s body.  And realize each successive kid may not fit the same.  My neighbor went through 5 different types figuring out what worked and let me try them out as well.  Turns out the first brand she tried, the g diapers, leaked like crazy and they had gone and bought a bunch of them.  Sadly she ended up giving them away to friends who could use them.

Don’t buy bottle sets.  Test out different bottles and see which one your baby prefers and you prefer.  Recommended brands for breastfeeding moms are Doc Browns and Playtex drop ins with slow flow nipple.  Doc Browns can be heated up in a bottle warmer unlike the playtex drop ins. And if you’re like me, you bought one set for $40 and 5 bottles, now my baby doesn’t even take the bottle.  But she did and we survived with 3 – 4 oz bottles and 2 – 8 oz bottles.  If you have to buy sets, buy the 8 oz size and just make less to save a few bucks.  Don’t buy formula either in bulk before birth.  If your kid has allergies they could end up on soy formula or allergic to different brands.  Disposable diapers you can stockpile, but keep receipt because stores allow you to switch sizes or brands.

If you make your own baby food, don’t bother buying an expensive food grinder or processor.  You can use a simple blender and ice cube tray.  Honestly it’s pretty easy, but I save the jars for going out.

The rest?  I was mostly fortunate to get a ton of stuff for free from friends or swapping with them.  So I may be in trouble next time around if I move and don’t have the same friends to “borrow” baby gear.  But I think I’m pretty much set for any future kids.

I will say I wish I hadn’t told people what we were having.  We got too much gender based clothes instead of gender neutral.  But at least I got gifted clothes so I won’t complain.  I just have to have another girl.

I read the book and I finally watched the movie with Isla Fisher.  Interesting is all I have to say.  I have to admit I didn’t really like the book very much. I thought it really unrealistic and very materialistic. I know that it happens, but I honestly don’t think that most people who are in credit card debt are like that. I think that for many things it’s living paycheck to paycheck and an accident happens that goes on the card.  Or a tiny bit of overspending from Christmas or bigger occasions.

I think that most people don’t have a friend who allows them to live rent free.  That they could spend their entire paychecks on clothes or stuff. After all the average consumer credit card debt is $8k, with 45% of people paying off their credit cards in full or not having on.  And something like another 40% have a balance of less than $3k.  Which leads me to believe that possibly some people are deeply in CC debt because of catastrophes.  Perhaps they always had a balance, which is bad, but it never was out of control until they lost their job or became disabled or maybe got into a car accident.

But in confessions of a shopaholic, it was over the top!  I have seen people putting purchases on different credit cards because obviously they were close to their limit. So they charged $50 here, $20 there, $100 here; but that’s mostly happened in a grocery store. I thought those people were probably hitting rock bottom charging groceries. It was not at a high end store where scarves cost $120.

But maybe I’m wrong.  Maybe it doesn’t matter if you charge $120 for a scarf or $120 for groceries.  Either way you can’t afford it.  But honestly I think there is. I believe that some people are trying to make ends meet and trying to pay all their bills and not buying a lot of luxury items but they still are slightly in the red every month. Perhaps it’s because they can’t get out from student loans, car loans, a mortgage, etc.

But I wonder are there really people who buy these $120 scarves?  Or a dress that is a whole paycheck?   I haven’t meet any yet, but maybe it’s just that I haven’t recognized a $3k purse or something.

We currently bank with Bank of America.  I don’t like them at all, but they have ATMs everywhere and branch locations as well.  Since we had our mortgage with them our checking and savings accounts were free, so we used them.  It was easy and convenient.  However since we won’t be having our mortgage with them, it’ll be something ridiculous like $8/month for basic checking, which is only waived if you keep a large balance.  Otherwise it’s  $10/month charge and they charge you for writing an excessive amount of checks, over 6/month.

I will admit that I’m nervous at the prospect of switching banks.  Our auto bill pays and debits are setup with BofA.  So switching over will be a pain, although I’ve started to compile a list of all of our accounts.

But the real hesitation is depositing checks and stuff into random ATMs.  According to ING it seems like we just go to a 7-11 or gas station and use an ATM in their network.  Then you can withdraw cash and not be charged a fee.  Okay, that I can handle.  But I am a bit nervous about depositing into such random ATM machines. I’m hoping readers will tell me they love it and have no problems.

I think the direct deposit for the paystubs is fine, but everything else?  Once it’s linked up the bill pay and auto debits will be great.  But random check deposits?  Will it be accurate?  Will it immediately reflect in the account?  What if it bounces?

I haven’t settled on ING, I’m still debating moving to a more local bank like TD Bank or a credit union.  But I probably need to make a decision soon, so weigh in please.

We will close on our refinance this month.  We’re happily moving down from 4.25% to 3.625% and from$460k to $417k.  This means our payments are going from $2250 to $1900.  It’ll actually turn out to be a bit more monthly because the mortgage company will now require us to escrow our taxes with them even though we’re at less than 75% LTV on the mortgage.  Basically they want to make money on our taxes and prevent a lien from being filed for our property taxes. I believe our taxes are around $500/month currently.  Ugh.

Our rate is fixed for 5 more years so we are good until August 2015 and we paid $0 closing costs and no fees.  We signed some documents and we’re rolling along.

The only problem we ran into was our credit reports.  The scores between were over 800 for both of us from all three bureaus.  Problem?  They almost couldn’t do our mortgage because of 3 accounts.

One account was a car loan that was improperly financed and not ours.  I’ve actually known about it and been dealing with cleaning up the mess since June.  Luckily I had a letter from the bank stating it was incorrect and being closed, but it was still open and reporting to the credit agencies.  Sigh.

Two other accounts were closed CC accounts from a long time ago which were “in dispute” but closed.  So we had to figure out which CC they were and what happened.  We were able to track down the CC and clear the accounts as closed AGAIN and the disputes were to be deleted since the accounts were closed.

While I found it aggravating I have to admit that it was sort of nice to see our credit report in detail and clean it up.  I usually do pull our credit, but I just mostly check that the accounts are actually ours.  If it says closed I have previously ignored it.

Honestly doing the refinance was a snap.  Signing a couple of documents, having our credit pulled, and sending off a few things.  Took less than 1 hour, except for the couple of issues with our credit.  Our mortgage broker said if you have good credit, income, and savings then getting a mortgage isn’t really a big deal.  And rates are extremely low.

I had to admit that doing the refinance did help us “clean” up our credit.  It also makes me thrilled about saving more money on interest.  I hadn’t previously refinanced mostly because we hadn’t paid off enough to get below the $417k  And now we have.

So I guess my tip is check your credit report and clean up all “disputed” accounts.  And keep calling weekly for loans that aren’t yours, because it really does take awhile to deal with everything.

FB talks about sleeping better at night because she’s ethical, but it does cost her bottom line.  Here’s my take on it.  I sleep better because I know sooner or later it catches up to you anyway so just get it done.

Taxes?  Well my BIL had a mistake on his return and got back more than he should have.  Friends told him to spend it, I said no way.  Turns out a couple weeks later the government wanted their money.  Another friend decided to not pay parking tickets.  One day it caught up to them about 5 years later when they moved and tried to get a new license.  Ugh.

I believe, no proof of course, that things always catch up to people.  You can’t outrun your past and perhaps it’ll be less than if you had dealt with it up front, but mostly it costs more to deal with it later.  Don’t get me wrong, it’s easier to avoid paying some bills (library fines, speeding/parking tickets, taxes, etc) but when they come due, they come due!

Granted I’ve posted a lot about people not paying their mortgages, cc, etc and having the money to do so but choosing not to.  Or people deciding to walk away from a foreclosed home and living rent free for months and walking away apparently in a better situation than not.

But I believe that it catches up to them.  I’d like to think that when you walk away from debt or owing someone money, you may “pocket” the money but I’d like to believe that they will have a hard time explaining it to a potential spouse or their children.  That you can’t really teach ethics to your kids if you don’t practice what you preach.  Or you can’t be with someone worth being with if you don’t have the same morals as them.  That people with morality will choose others with the same beliefs.

But maybe I’m wrong.  My take now more than ever is money is money, but I need to have good morals and ethics if I want to pass it down to my daughter.  And showing her that I always take the easy way out I believe will do a detriment to her future.