Here are a few tidbits and tricks that I have learned about finances this year:
I joined a credit union. Don’t worry, I still have my amazing checking account (I just recommended Charles Schwab to a friend going to Europe so that he can take advantage of their no-charge foreign ATM options- free currency exchange, y’all!) I joined this credit union for three reasons.
- They have amazing interest rates on auto loans and mortgages. I don’t need a mortgage right now, but one day I will, and I wanted to set myself up as a customer so that in the future I will have access to awesome interest rates.
- They have amazing interest rates on CDs. (A CD is a Certificate of Deposit. It is basically a higher-rate savings account where you promise not to touch the money for X amount of time, and you get a higher interest rate than a normal savings account where you would have access to your money whenever you want.) This year, they ran a promotional special for a 1 year CD that returns 5%! I don’t know if y’all are paying attention to interest rates, but this CD is like a miracle. I’m making $150 by letting them sit on my cash for a year. I put in cash I have earmarked for our wedding so I wasn’t going to spent it in the next year anyway, and the CD will mature two months before the wedding….so now we can have a bigger cake!
- They have a coin sorter machine that doesn’t charge anything to use (like a Coinstar but free) and the money gets deposited directly into your account. Which is just so cool!
Credit unions can be really good because they are (usually) local businesses that provide services that might not be as good at a larger bank. It can be smart to establish yourself as a customer so you have access to their resources. When I opened by account I put $5 into a savings account- and now I am a customer!
I have been paying off my student loans based on the highest interest rates first- except starting in November, I put all of my payments towards paying off the interest. This is because student loan interest (but not the capital) is tax deductible. That means that paying off the interest of my student loans can lower what I owe in taxes. I did some quick math and discovered that the amount I could potentially save in taxes (this year will be tricky for me so it is just an estimate) is a few hundred more than the amount I would save in interest if I had just kept paying off the loans with the highest interest rates.
This year has been very exciting but also has required me to be very flexible financially. Here are some things that have changed and how I dealt with them:
- I finally saved enough to afford Lasik, but my work now provides a Healthcare Savings Account that is tax-free. Instead of using the money I had saved for what I intended to save it for, I am using the tax-free HSA to stretch my dollars further.
- I moved the Lasik savings into my wedding fund. If you remember, I recommend that each person save about $9000 for their weddings, if they want a typical American wedding (more on this later). $9000 is super daunting to save…except that when my fiancé proposed I had already saved for Lasik (and then could feel good about changing my plans for how to use the money) and I had just completed my emergency fund. I just kept saving at the rate I had been saving (haven’t missed one penny because I never had that as spare money!) and we are having a relatively long engagement. We expect to be ready to pay for the wedding in full when the bills start rolling in.
I had a beautiful “goals” tab in Mint going into the year, and now my goals will be met…but in a different way than I had anticipated earlier in the year. I was able to be flexible because I spent two years building a sturdy emergency fund and saving for a wedding fund (even though I thought it was a Lasik fund!). Slow and steady savings means we are able to do what we want when life gets exciting!