Thursday, January 10, 2008

Fabu-money 1 – Developing Savings while a Graduate Student

If a drug cartel can set up a savings program, anyone can
Photo credt:

I’ve been a university student longer than I’ve been anything else, other than human and female. All told, I’ve been in school, on and off, for 14 years, 11 of which were spent as a full time student. I’ve racked up student debt and I’m now in the process of paying that odd while I remain a student. Pretty snazzy huh? How am I doing it?

Well, first, once I entered my doctorate, I stopped taking out loans. A students should never enter a doctoral program that is not willing to pay something for them to be there in the first place. That was my first smart move. I made sure that the program I entered offered me something. Granted, my program didn’t pay me very much and I have had to take up teaching to pay the bills – but I am not gaining debt while I’m in school. That is very, very important.

I still have a hefty debt load from my undergraduate degree. One of these loans is a government loan that cannot be paid down while I am in school. The other is a student line of credit. I am paying them down and building wealth at the same time. How? Well, my method may not be for everybody. It’s a mix of advice for several big financial gurus. It may not be the method for you, so I’m not universally recommending it. I’m not a certified financial advisor and have no credentials in the area of money management. I’m just giving you the D.L. on why debt load is no longer burning a hole in my stomach.

There are 3 large components to my strategy. They are as follows:

a) Develop Savings - Pay Yourself First
b) Be Aggressive – Track, Evade and Slaughter Debt
c) Invest Directly

I’ll only discuss the first of these components today.

I Developed Savings

Having money is a savings account is so important in easing my worries about debt. One of the worst feelings I’ve ever experienced is one of helplessness when I was faced with large, sudden charges for health care or tax repayment and had no money in my account but rent.

Money can be saved in a savings account with the goal of using it for emergencies, aggressive payments towards debt or investment. Without liquid savings of some kind, there is very little I could do with my own means to support myself when unexpected bills or cash losses happened. How does one establish savings when one has little income? Well, this might not be the best method for everyone and I’m not certified in personal finance, but this is how I did it.

I Paid Myself

I earn a pittance as a graduate student. I formerly held the opinion that I should direct all my spare money towards debt and save later. When I looked at that logic closely in light of my consumer debt, it seemed ridiculous. My credit card has an interest rate of 18.6%. Unless I was capable of making aggressive payments towards the principle, I would be constantly spooning out an ocean of interest with no assets to show for my time.

That’s when I adopted a practice recommended by David Chilton, the author of the Wealthy Barber - that is, set aside 10% of my income for liquid savings and do not touch it. That might seem like a lot if you can’t pay your phone bill, but I did this even lean times. The way I see it, I’ve earned, approximately 400 000 to date – excluding gifts, union repayments and possibly a few jobs I don’t recall. That doesn’t seem like much for a life time of working, but had I saved 10% of that, I’d have 40 000 in the bank right now.10% is so small, that even when paying the bills seems hard most people do not notice the money. Every paycheque, I set 10% of my net income aside and do not touch it.

I Paid Myself Unexpected Money

The savings have accumulated really quickly, despite my student status. I’ve saved roughly 10K in two years and have barely suffered doing it. I’m not earning 50K a year, so you might ask how I did managed to save that money. Along with paying myself 10%, I also put any unexpected funds into my savings account.

Unexpected funds are cheques from grandma, income tax repayments, money saved by buying something on sale, money earned in past time activities or through sale of personal items. I defined it as money that falls outside of regular income or savings made by not purchasing something full price. When my parents give me a cheque for my birthday, I have a choice to spend it or save it. I decided to put this money in savings the day I looked at one of my checkings account statements and realized that all of those purchases were for temporary items, usually clothing or restaurant dining, that I would not miss if they disappeared or if I never had them. Rather than spend this money on something dispensable, I put it aside. I even threw in money refunded from purchases that could not be directly refunded back to the paying account

Outside Work just for me

To help build my savings I decided to earn a little bit of money from work outside of my regular graduate student jobs. As my research schedule is very demanding, the work I chose could not have high time demands. Waitress and bartending work would have required more time than I could spend. The work also had to be enjoyable as it would occupy some of my very infrequent spare time. In the end, I chose worked several, short term, outside jobs. I searched for art school modeling work (they look for people of all shapes and sizes), and basic book research work. Both of these positions were fun and had agreeable schedules. The funds from that work, while small, were also put into my savings.

I Celebrated Every Savings…

… a money healthy way. It was really easy for me to save money when I had fun doing it. Even when I have $50 in my checkings account the last few days before my paycheque, I always found a way to celebrate the $75 I put into savings when that paycheque arrived. Sometimes that meant I bought a cafĂ© latte, sometimes that meant I went into my research area late. Other times, it meant that I just took joy in watching the numbers in my savings account increase.

I Never Compared Myself to My Contemporaries

Graduate work is a tough road. Not a lot of people understand why I pursued it and it can be tough to stick to my research while I’m watching my college friends buy houses and have babies. It can be very depressing to look at my accounts and start accounting for the assets my contemporaries have. ……so I don’t do it. I don’t think about what other people have or wonder if I’m financially behind everyone else. It’s self-defeatist. I just take joy in the idea that I’m doing something for me.

Monday, January 7, 2008


I’m a nut for pretty stationary. The penpal of no less than 14 people when I was a teenager, I grew up hunting for quirky and attractive paper goods to scrawl my goings-on in my chicken scratch to friends overseas. Being a young teenager, before the internet was used in homes, I spent a lot of time searching for paper that expressed my personality but fit within my budget.

Today, I, like most people, have limited my extension of personal, pretty, paper letters to wedding invitations, thank you cards, holiday cards and letters to old-timers who have limited computer access. Although I’m sciencey and should be writing with black pens, and maintain sterile, serious looking calendars and notepads detailing great thoughts, I remain a sucker for pretty paper goods. In the spirit of looking for those perfect paper goods on my super low budget, I’ve found the following:

Fabulous Stationary

Quirky, pretty, personalized and, if you need a larger number of cards, a beautiful bargain. My personal favourites include:

The Calling/Business Card: $55 for 100, or roughly $0.55 a card. My information and affiliation changes frequently, but I have multiple non-sciencey meetings a year where I need a memorable card.

The Stripes Card: $125 for 100 cards, or $1.25 per card - printed. These are great if you have a need for a lot of hip save the date, thank you cards or even laid back wedding invitations. With the average cost of low end wedding invitations and thank you cards costing twice as much before printing, these cards are a groovy alternative.


Greeting Cards
This CafePress shop has some highly mod, monochromatic greeting cards under the title of “Go-go Girls”. The price, while not by any stretch prohibitive, designates these cards to my low rotation deck of stationary – that is, they are used when I want to impress people with my youthful hipness..or hiposity. You can check out everything else this great designer has to offer here.


This store has many more cool designs that are budget friendly, including hyper-mod postcards

Paper Studio

Decorative Paper/Paper to be framed/DIY Paper

I love the new look of wallpaper and I hate wallpaper. I rent, I have no money and I hate dust. Rather that hang wallpaper, I frame decorative paper or use it to spruce up utilitarian furniture (post on revitalized filing cabinet to come). Some of the prettiest papers at a low cost, for this purpose, are available at Paper Studio.

Wednesday, January 2, 2008

New Years Resolution: The Fabu-closet

Like most people I make New Years resolutions. I tend to keep them, but then, I tend to set goals that are attainable within 6 months. This year I set three goals:

a) Commit 40 hours or more a week to being a scientist
b) Eat in and Invest as part of a plan to be more financially responsible
c) organize my closets.

Resolution B will be the topic of a future Fabulife post. This post will be dedicated to this month's project, organizing the apartment closets.

Why? Well, an organized closet assists in buying new clothes and linens, keeping older clothes and linens in good shape and lifting self-esteem. If you don't believe that last point, I would suggest reading one of the multitude of books out there on defining personal style and finding something to wear in a closet full of unwearable clothes. Jesse Garza and Joe Lupo, Posh Spice have just published books on this matter. Tim Gunn and Veronica Webb host a show dedicated to this topic as well. They all recommend organizing closets as a first step in defining personal style, "destressing" the outfit assembly process and improving self-image.

Personally, I'm organizing the closets because I can't take the tumbling boxes, and falling towels anymore. I have about $250 to spend in this effort. While I love the style of Paris Hilton's last walk-in closet, I have 600 square foot apartment with three little reach in closets with sliding the dream will have to wait.

People with money can afford to hire a closet organization service. Companies like Closet Organizer USA, will custom build closet inserts for a customer based on customer needs, closet dimensions and closet type.

I am, however, a graduate student in New York City. I can't afford custom closet design by anyone but myself.

As I am a student, I am a renter. I, therefore, am not interested in buying storage systems that extensive wall installation.

For my whopping budget of $200, I was able to find the following closet organization items that will cure my falling towel and tumbling box issues.

This "Hold-All Handbag Hanger" in Blue Blossom, currently being carried by Target for $29.99. It is a little overpriced, in my view, but I love that it holds the bags vertically.

No New York City apartment would be complete without space saving hanging closet bags. This set of two are available at Target for $19.99. Given the pest infestations in the city (i.e. carpet beetles, moths) that can lead to unfortunate damage to both natural and synthetic fiber clothing, vinyl clothing bags are really important for storing items not often used, like formal wear.

Closits modular storage systems are low cost, do not require wall installation and have a sort of cute cottage, shabby-chic feel to them. The system has multiple components including backed shelves, sliding drawer units and show cubby holes. All components are available at Walmart and Target for roughly $50 or less. I've invested in the double shelf unit, large drawer storage, and shoe storage.

With the cash I had left over, I searched and found reasonably priced wooden hangers.

Alas, the wire monstrosities can be tossed and no more shall Joan Crawford like screams regarding hangers will emanate from under my apartment door.