October 22, 2015

Turning Pennies into Memories ~ Establishing a Budget

This is the second post in a series on how to finance your travel dreams (you can read the first post, "Changing Priorities," here). Whether you're working a minimum-wage job, have a comfortable income, are burdened with heavy debt, or just have a few small loans to pay, the principles in this series can be applied to almost every category. As someone who has been able to finance trips to Europe in cash while working minimum wage jobs or while a spouse was unemployed, believe me, this is something you can achieve if you make it a priority. It's just a matter of time.

Changing Your Priorities | Establishing a Budget | Sticking to the Plan


Turning Pennies Into Memories 
Step 2: Establishing a Budget

There are many free online tools available for establishing a budget, but I'm a big fan of the Dave Ramsey Financial Peace plan. Dave Ramsey is a big proponent for living within your means, cutting out any and all debts, and doing so by living frugally (sometimes painfully so) until you're debt-free. I developed the unofficial Thrifty Gypsy motto of "Live within your means so you can travel beyond your dreams" from principles learned in the Dave Ramsey program.

First, identify your monthly income amounts. That should be pretty easy. Then, recognize the difference between "needs" and "wants." I want to buy a tall double chocolate chip frappuccino from Starbucks every day, but it is certainly not a need. So when creating a budget, I begin by listing the bare necessities along with the amount due each month:
  • Rent/Mortgage
  • Utilities (electricity, water, etc)
  • Insurance (health, car, life, etc)
  • Groceries
  • Outstanding debts (car payment, credit card, etc)
  • Tithing
  • Savings
Yes, your list of necessities should include savings. I advocate budgeting for savings from the get-go instead of using the "just put whatever's left over into savings" method. Even if it's just a modest amount, put yourself in the habit of saving a certain percentage or dollar figure at the beginning of the month.

The list of necessities will vary from person to person. Create your itemized list and indicate the monthly amount owed beside each. From my experience, the grocery item is where we hemorrhage the most money, and where we have the greatest opportunity to manage how much we spend. If you have no idea how much you spend on groceries in a given month, make an educated guess based off your bank account transactions and plan to fine-tune and control this amount in future months once you have more data on your spending.

Your budget* should now look something like this:

This budget is not reflective, indicative, or in any way a representation of my own personal monthly income. Please see further clarification at the end of this post.

Now that you've identified the basic needs, there are a few other things you should budget for that aren't quite in the "wants" category but aren't expenses that appear as regularly as the others. These things can include:
  • Personal property tax (car, house, etc)
  • Christmas/birthday gifts
  • Mechanic bills
  • Clothing
  • Vet bills
There is nothing more financially frustrating (or even devastating) than receiving an unexpected set-back like a car repair bill or realizing on a rainy day that the soles of your shoes are rather hole-y these days. That's why every month you should be setting money aside for categories like clothing, personal property tax, and yes, Christmas and birthday gifts. Even if you're only able to set aside $10 per paycheck for each category, that squirreled-away money will accumulate and help take the edge off an unexpected bill's bite down the road, making you less likely to dip into savings or run into the red. This money can either be set aside in a bank account or in the form of cash put into separate envelopes and stashed somewhere safe (both from break-ins or from you dipping into it for other reasons!).

It's time to take a closer look at your debts, specifically items such as a credit card payment or a car payment. You need to get rid of them. If you were to read the fine print and actually calculate how much you're paying in interest, you would find that the $5 Starbucks drink you put on the credit card and didn't pay off before interest accrued could cost you as much as $5.90 (at 18% interest). While that may not seem like a lot, what about that bedroom set you "just had to have" and you put on your card for $500? After one month of not paying it off, that bedroom set cost you $590. If you didn't pay anything beyond the minimum payment for one year (even without putting anything else on the card!), that amount will cost you more and more until you've spent double or triple the list price. Suddenly that bed isn't as comfy as it used to be...

Plan to pay off your debts as quickly as possible, starting with the lowest balance. While it might seem "smarter" to tackle the debt with the highest interest rate first, you'll find that paying off a debt gives a well-needed emotional boost to continue tackling the higher balance accounts.

Now that you've identified income, regular expenses, irregular expenses, and made a plan to eliminate your debt, what does that leave you? Well if you have anything left over, you could budget for your "wants" or you could put more money into savings.

If there's nothing left, good job! You've told your money where you want it to go, and your income matches your expenses to the penny (including the "expense" of saving)! If you have funds left over, that's even better! Put all "left-over funds" into savings. You've now made savings a priority both at the beginning and end of the month.

If, however, your expenses outweigh your income, you'll have to make adjustments. No, you should not cover the deficit with a credit card. While the Federal Government likes to borrow money from Peter to pay Paul and hike taxes on John to pay Peter, that doesn't mean you can or should follow the same policy! Evaluate your expenses - are there any "needs" that are really "wants?" If not, lower your expectations on your irregular expense categories and/or your savings by a small margin, until the net between income and expenses equals zero.

And that, my friends, is how you take another step towards debt-free living and (ultimately) more travel experiences. Let's summarize:
  1. Recognize the difference between "needs" and "wants."
  2. Create a budget where "needs" come first and savings are included in your "needs."
  3. Identify irregular expenses and set aside funds in the budget to be prepared for these expenses when they occur.
  4. Place left-over funds into savings in the event of a surplus, or adjust your savings expectations in the event of a deficit.
  5. Practice self-control; put your budget plan into motion.

* For the sake of my own personal financial privacy and that of my husband, all example budgets shown in this post are completely fake. The only resemblance it bears to my personal budget lies in the naming of individual line items and (in some cases) the percentage ratio of a particular expense category to the faux income amounts.

Linking up for #WeekendWanderlust!

October 18, 2015

Prague Photo Fails

If you look at the Instagram feed of the average travel blogger, you'll find Pinterest-worthy photos of perfectly buttered scones, elegant ladies draped casually at the feet of ancient ruins, and brightly-colored vistas of some exotic island. These photos are meant to entice you to eat, visit, and enjoy the various wonders of the world. But while these photo feeds are not lies, they make it easy to forget the not so picture-perfect aspect of traveling. You know the moments - the time the very, very large gentleman wanders into your perfect photo nomming on a large hotdog and spilling ketchup all over his shirt. Or the one where the wind whips up out of nowhere, blowing your hair into your face until you resemble Cousin It (see above). Or the one where you eagerly try to capture an action shot but forget to change the camera setting so it comes out as one huge blur.

Sometimes these photo fails can break your heart, especially if it's the only shot of a place or event you witnessed on the road. But oftentimes these photos can prove amusing and make for even richer memories. As such, I'm sharing a few of my "photo fails" from our trip to Prague.

A windswept look? Or merely messy?
The dude bro on the left just would not move, no matter how many times we took this picture.
These knights were marvelous to watch. Too bad I forgot to put my camera on a better setting for the light and the movement.
Selfie fail! I didn't even make it into this picture!
One of those "let's take an artistic shot of ourselves with the castle in the background" shot that just didn't work out...
Awkward stance? Check. Too much bridge railing? Check. All that's missing is a pitchfork, and we'd look like these guys.
I call this the "inappropriately clothed American awkwardly clutching at her side" photo.
Because nothing says "artistic shot" like trash in the foreground of a Charles Bridge photo.

Romantic night photo turned horribly, horribly blurry.

Do you have a lot of "photo fails" from your travels? Any funny ones you'd like to share?

For more info and photos of our trip to Prague, be sure to check out the article suggestions below!

Linking up for #TravelTuesday!

October 11, 2015

Kitties of Athens

Considering my name is Katrina, should it be any wonder that I have an affinity for cats? Whether it's making a feline friend on Germany's Romantic Road or getting a leg bump from a Czech cat in Prague, I seem to find furballs everywhere I go! Athens is particularly renown (or notorious?) for all the stray cats, and this photo essay is unabashedly dedicated to a few purring beauties I saw there.

#Sorrynotsorry to all my readers who prefer dogs. Maybe some other time! And #sorrynotsorry that some of these pictures are less than artistic. Cats are not known to cooperate with eager photographers!

On the prowl
Athens' very own Grumpy Cat
"Don't mind me, I just hang out in ancient ruins all day."

"That's right. YOU cook for ME."
"This is my good side."

"I don't often stare into the distance. But when I do, I try to look as philosophic as possible."

"Na na na na naaa na, I can touch this and you can't!"

"Can I has a gyro pwease?"
Do you have an "animal problem" when you go traveling?

October 08, 2015

Turning Pennies Into Memories ~ Changing Your Priorities

This is the first post in a series on how to finance your travel dreams. Whether you're working a minimum-wage job, have a comfortable income, are burdened with heavy debt, or just have a few small loans to pay, the principles in this series can be applied to almost every category. As someone who has been able to finance trips to Europe in cash while working minimum wage jobs or while a spouse was unemployed, believe me, this is something you can achieve if you make it a priority. It's just a matter of time.

Changing Your Priorities | Establishing a Budget | Sticking to the Plan


So... you want to travel! But at the end of every month, you don't seem to have a red cent left to put into the "Travel Savings" account that has been gathering more dust than dollars since you opened it. Unexpected expenses and unanticipated bills seem to pile up at every turn, making your ability to pay your rent as unrealistic as your dream of visiting the Greek isles.

If this is your situation, you need to get your finances under control -  but not for travel's sake. Your finances are controlling your life. It's time for you to tell your money where to go, and not the other way around. Most Americans have a debt problem, but you don't have to be one of them if you make it a priority.

Turning Pennies Into Memories 
Step 1: Changing Your Priorities

"You know that we are living in a material world, And I am a material girl."
~ Madonna

"Instant gratification takes too long."
~ Carrie Fisher

Western societies revolve around consumerism and instant gratification. We want our things, we want the fanciest things of all, and we want them ten minutes ago. From commercials that tout keeping up and surpassing the Joneses to companies offering same-day shipping and delivery for items purchased online, we have been conditioned and accustomed to not having to wait for anything. In many ways, this is great! But in a world where having multiple credit cards is as American as apple pie, it's also very dangerous. 

As stated previously, most Americans have a debt problem. According to a CNN Money article published in July 2014, 1 in 3 Americans have debt that is in collections. That's roughly 77 million Americans. How does this happen?

While there are instances where a job loss all but necessitates living on a credit card (been there, done that), I would venture a guess that the biggest reason Americans have such a heavy debt load is lack of self-control. If we want something but can't afford it now, do we wait and save up incrementally until it's within our reach? No, of course not! We pull out good ol' Mr. Visa and take our items home that very same day. Problem solved, right? 

The problem with putting ourselves into debt is that we become a slave to it. We've handicapped our future selves with a burden to pay off past items, plus interest. It may have seemed like a good idea at the time to buy that discounted bedroom furniture set on your credit card, but did you take into account the interest you'd be paying on top of it every month? Most credit cards average at 15% APR; just in one month, that $1,000 bedroom set has cost you an additional $150, and if you only make the minimum monthly payment, it'll take years to pay it off.

It's time to cash out of the mindset that having credit card debt is normal or okay. It's not. You need to get rid of debt, and you start by changing your mindset and your priorities.

If you want something, pay cash for it.
If you don't have the cash for it, save for it.
If you already have debt, prioritize paying off your debt before you buy any "wants."

Don't buy things you can't afford. Don't put yourself into the slavery of debt. It's as simple as that!

When you want a fancy dinner to celebrate an anniversary, buy steaks and wine for a candlelit dinner.
When you really want to see a new movie, rent a Redbox "new to you" movie instead.
When you're feeling the need for a cocktail, make and enjoy it at home.
When you're bored with your clothing and want to revamp your wardrobe, focus on your end goal. You don't need half as much as you own.

When I came back from a mission trip to Uganda in 2007, I felt the need to get rid of all my excess items. Why? Because I saw how people can live on a little and be twice as happy as Americans glutted with too much. If you need a little dose of reality, watch a YouTube clip of what life is like in a third-world country, and all of a sudden your "outdated" wardrobe will make you feel like you're wearing Queen Elizabeth's duds in comparison!

Get your drink on with a view like this on a rooftop bar!
This is not an easy mindset to maintain. Like I said, we live in a society where eating out, having coffee with a friend, and buying a new top just to keep your wardrobe fresh is the norm. Deviating from this will make you stand out, and even the most loving of friends and family will sometimes put pressure on you to "come out for drinks just this one time" when you really should be putting that money towards financial freedom. Believe me, I've been there. But this is a choice you've made. You want more money available to spend on your travel dreams, right? Missing out on drinks and appetizers with friends may be disappointing at first, but remember that money gets you one step closer to cashing in on drinks and appetizers at a roof-top bar with views of the Acropolis in Athens. How's that for a trade-off?!

So what makes me such an "expert" on this topic? Well, first of all, I am no expert or financial adviser. I'm just a girl who put herself into deep credit card debt during college so I could keep up appearances with the endless rounds of socializing in my circle of friends. It took years to pull myself out of debt and salvage my damaged credit score, but I did it - even when working just minimum wage jobs. And I did it by changing my priorities.

And you know what? I can say with absolute conviction that "missing out" on eating out was more than worth all the memories I've made on various domestic and international trips I've been able to afford over the last few years. And now that Danny and I are expecting Baby Gypsy in December, I am happy with the solid financial foundation we've laid. Our savings account is not yet where we want it to be, but with the exception of a very small car loan*, we're well on our way to being debt-free and able to keep making our travel dreams a reality!

*If and when we do purchase a house, we will inevitably go into debt for a mortgage. While many financial peace planners (including Dave Ramsey, whose Financial Peace University is my personal favorite and the one whose principals are more or less outlined in this series) advocate not even buying a house until you can pay in cash, I don't think we will follow this route. Houses acquire equity, so I consider that "good" or at least "safe" debt. Credit card debt and cars do not increase in value; your car will never be worth more than it is now (unless you're a lucky duck with a sweet antique car!), so carrying debt for it is unwise.

Linking up for #WeekendWanderlust!

October 01, 2015

Mapping My Month: October 2015

It's the end of the month! Time to look back at the past month's travels and announce the next month's adventures. So this October we'll be going....


And I am more than fine with that!

Last month we took a last-minute trip back to Europe, piggybacking off Danny's business trip to London. While poor Danny was working 12-20 hour days at the office, I wandered around Londontown revisiting my favorite spots like Parliament, the British Museum, and the Tower. I crossed off a bucket list item of attending an Evensong service at Westminster Abbey and got lost multiple times in Harrods (that wasn't quite on the bucket list, but it made for an interesting experience nonetheless!). I had two and a half glorious days in London - more time than my initial visit last February - before Danny and I caught an early flight to Frankfurt, swapping our fish 'n' chips for brats 'n' beer and a visit with our Bavarian family! It had only been three months since our last visit, making this trip the fastest turnaround time yet. Our three and a half days in Germany flew by like the wind, and after missing our initial flight back to London, we finally made it home two weeks ago, tired but so incredibly blessed and thankful for having had such an unexpected trip.

Since our return, I've been playing catch-up. And so far I've been losing! My responsibilities at work have increased due to some exciting opportunities in marketing, which have left me little time or energy to devote to the blog. Baby Gypsy's arrival in less than three months has also kicked some of our home prep-work into high gear as we finally assembled the crib and changing table my parents bought us two months ago.

Oh, and a stray dog showed up at our house last month. We took her to the no-kill shelter this morning, but based on my husband's look of dejection, we may end up picking her back up next week if she hasn't been adopted by then... It would be a sizable financial investment, though, so I really just hope someone wants her!

ATTN #Goochland and central #Virginia! This dog showed up at our house a month ago, and we simply cannot keep her as her owners have not come forward. She is very sweet, craves attention, and submissive, but is too wild (as in untrained) and strong to be a house pet. She's a hound, howls like one, and roughly 2-5 years old. She's been bathed and treated for ticks. If no one adopts her by Friday, I'll have to call animal control or a shelter. We don't want her, can't afford her with a baby on the way, and do not have the facilities to continue caring for her. So if you or someone you know needs another hunting dog, please contact me. #lostdog #founddog #dog #adopt #adoptadog #huntingdog #goochlandcounty #fluvanna #fluvannacounty #henrico #henricocounty #VA #hunt #hunting #adoptme #helpme #animallover #animal #rescue #foxhound#huntclub
A photo posted by Thrifty Gypsy's Travels (@thriftygypsy87) on
Life is good, though! I just wish there were more hours in the day to accomplish everything, especially as I have so many untold stories from our trip to Europe this past May and from last year, let alone the one we took last month.

As I stated, though, October will be a quiet affair travel-wise. We'd like to make an autumn visit to Kilmarnock and go up into the Blue Ridge for apple picking, apple cider, and apfelstrudel-making supplies, but that will be weather and schedule dependent. Additionally, our sisters are hosting a travel-themed baby shower in mid-October (they know us so well!), and we're contemplating when to throw our annual pumpkin carving party in preparation for one of Danny's favorite holidays, Halloween! We didn't end up decking ourselves out in costumes last year, so we'll see if we can drum up the motivation this year. So although we may not have any travel plans on the calendar for this month (or realistically, for the rest of the year), that doesn't mean we'll be any less busy!

What're you getting into this October?