…I find, is a perennial pain. I have most other aspects of the family finances down pat, but I am frustrated with our stagnant savings. Apart from retirement accounts, our savings haven't budged upwards in three years, partly because we approached the savings account as fungible: that is, long-term savings, vacation money, and tuition were all in one big pot. The problem was that the pot never got any bigger, because while we were saving, expenses cropped up at an equal rate.
A while ago, I stumbled across Richard Jenkins’s article “The 60% Solution” (see ecogeofemme’s post below) and started taking a more targeted approach to saving. Because my husband and I live in
Then there are the two months out of the year when tuition is due, and all hell breaks loose.
The seemingly logical thing to do would be to add up all of the anticipated tuition due for the year, divide by 12 and sock that amount away each month. The problem with this approach is that it would have worked beautifully if I had started doing so before I began my master’s program. I didn’t, so I am perpetually behind the 8-ball. Currently there is $500 in the annual expenses savings account, and a tuition bill of $1,740 due at the end of June.
Because my husband and I already have over $70k in student loan debt, I don’t consider more loans an option. I need the second degree to qualify for the job I already have, but I can’t anticipate a salary bump once I finish, so it doesn’t seem wise to take on additional debt.
As has happened each of the previous two years, I’ll probably have to take part of it out of long-term savings, which is really frustrating because this is a major reason that we have made no progress saving. At least this year I can use my $600 tax rebate check to cover some of it.
Then I can start saving for the next tuition bill, which is inevitably due in January – at exactly the same time as the Christmas bills come due.
Even if I can’t budget enough to cover airfare home for the holidays, presents, and tuition, I can at least try to cover some of the anticipated expenses. $1740 divided by 6 months is an extra $290 that I will have to find in the budget, but at least that January bill will be the final tuition bill ever. I graduate in a year, if all goes well, and I won’t have taken on any additional debt to do it.
That’s going to feel like a huge accomplishment in and of itself.
How do you handle tuition bills? Divide and conquer? Loans?
2 comments:
During my masters I did a combination of loans and divide and conquer. At that point in time the long-term savings was nonexistent to say the least.
Even if you can tuck away part of what you need to save, it makes the hit smaller when the bill is due so you can eventually get on track to save it all. Sigh...that's easier said than done. The only way I can really save is to have the money wisked away to a separate account on payday so I don't see it.
Congratulations on being so close to finishing. Won't it be great when you pay that last tuition bill!?
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