Author Katelyn Hayes Archive

Recently I wrote about the benefits of cutting credit cards out of your life to save money and help rein in your budget. I figured it’s only fair to put my money where my mouth is and follow through myself.

So last month I put my credit card on the shelf and relied exclusively on my debit card for, well, everything. Turns out I charged a total of $975.95 to my debit card, and saved $228 in interest fees by doing so.

But besides the obvious benefits of saving on those added interest costs, I also wanted the exercise to help me pinpoint where my money goes. I can’t say I am surprised at where the bulk went, but the amount shocked me — especially since, like the rest of America, I’ve been cutting back for many months already.

Maybe it’s because I’m tired when I get home, maybe it’s because I’m a bad cook, or maybe it’s because I live upstairs from a restaurant row; whatever the reason, I’ve realized I spend most of my money dining out — $338.83 last month, to be exact. This includes dinners, brunches, workday lunches, happy hours, take-out and anything else prepared by a restaurant.

So I’m taking on a new challenge this month: Cash only! And when I say cash only, I mean literally using greenbacks exclusively. It will probably be a pain to run to the ATM on a regular basis, but I’m hoping (hypothesizing even) that watching the cash dwindle before my eyes will help me put the breaks on spending across the board.

When using a credit or debit card, it’s easy to separate needs (gas and groceries) from wants (clothes and dining out). But when I have a finite cash flow for everything, I’m hoping it will force me to scrutinize each and every purchase — be it an office vending-machine snack or buying the expensive brand of shampoo at the grocery store.

So I’m only a few days into the month, and I’m already committed to a cash-only lifestyle. Oh, and I have to run to the ATM.

Be sure to check back in a couple of weeks and see how I’m doing with my cash-only diet.

Do you think I can stick to it and save? Are you willing to join me on a cash crusade to rein in spending habits? If you do switch to a cash-based existence, let me know about your progress!

Millions of Americans have faced, are facing, or will face foreclosures since the booming housing market busted and the mortgage crisis set in. While President Obama is working feverishly to bring his $75 billion mortgage rescue plan to fruition, people caught in a bind right now are finding creative ways to deal with a foreclosure looming over their heads.

Take the story of one woman whose “American Dream” came crashing down on her. After Heather Gray broke up with her fiancé and was laid off from her job as a public information coordinator for Mesa, Ariz., the 33-year-old found herself in over her head and about to lose the 2,200-square-foot home she bought in 2007. Then she got resourceful.

To escape her impending foreclosure unscathed, the Air Force veteran decided to donate her house to the Murray Grey Foundation, which in turn plans on raffling off the $280,000 home for $100 a ticket. The raffle is scheduled to take place on April 11.

The non-profit foundation financially aids military families facing foreclosure — a facet of the population that saw a 217-percent jump in foreclosure proceedings in the first four months of 2008.

According to a FoxNews.com article, Gray and the foundation struck a simple deal that allows her to “walk away” from her current predicament with a clean slate:

“We made the plan to raise $500,000,” Gray says. “I need $350,000 to pay off my debts in the home that I owe, and the charity will receive at least $150,000, and anything we receive over $150,000 will go directly to Murray Grey, 100 percent.”

The raffle tickets count as a 100-percent charitable deduction and — bonus —every person who purchases a raffle ticket will receive a $500 voucher good for either food or groceries anywhere in the U.S.

But like any too-good-to-be-true deal, there’s some fine print you need to be aware of before you take a stab at it. You’re responsible for paying taxes to the government for the home as taxable income — the same way you’d have to if you won the lottery.

While this probably isn’t an ideal solution for most homeowners facing foreclosure, it seems to work for Gray. She gets the chance to support a charity close to her heart and walk away from $350,000 untouched. Broke, maybe, but debt-free.

Louis Beverly is mad as hell about the foreclosure crisis, and he’s not gonna take it anymore. Instead, he took a bolt cutter to the lock on a foreclosed home.

Beverly calls it an act of civil disobedience. The Baltimore Police Department calls it criminal.

Police arrested the Association of Community Organization for Reform Now (ACORN) activist in the country’s first known arrest for an act of civil disobedience to protest the foreclosure crisis.

FoxNews.com reports Beverly exclaimed “This is our house now,” as he cut the lock on the home. He faces burglary charges for the act.

Donna Hanks owned the home at the center of Beverly’s protest since 2001. She lost it in September after she was unable to make the $1,995 mortgage payments.

ACORN views this first attention-grabbing act as a victory and just the beginning of a bigger movement, or, rather, “program.”

Joe Cox, a Baltimore based spokesman for the group says:

This program is saying, ‘We are not going.’ People say we are breaking the law, but we don’t see how putting a person back in an abandoned property is harming anyone.

I see truth and fault in Cox’s logic. While I’m all for a little civil disobedience every now and then — I mean, really, who isn’t? — is this just another form of rewarding some for irresponsibility while others who’ve struggled to live within their means and make their monthly payments are forced to pay the price?

Is ACORN righting the wrongs of homeowners treated unfairly by big business or just creating a call to action for people to stop paying their mortgages in favor of squatting? The ramifications of a nationwide movement of that kind could open an immeasurable Pandora’s box.

ACORN claims they only want to stop foreclosures long enough to give homeowners time to renegotiate a loan and stay put. But where do you draw the line between homeowners who’ve been wronged and people who just decide they’re entitled to live in a home they can’t afford simply by not paying the mortgage and “protesting” their eviction?

Do you think ACORN’s civil disobedience tactics signify a long-needed stand against rampant foreclosures, or is it a short-sighted effort that could wind up deepening the issue?

In these harsh economic times, almost everyone’s budgets err on the side of frugality, but one New Hampshire family is taking penny-pinching to a whole new level. Heather and Bourne Spooner want their family of four to live on $1,500 for one year! Yes, an entire year! Now that’s ambition.

The family set a goal to spend only $1,500 this year on all groceries and household and personal care items. They plan to achieve it by stocking up, shopping during sales and paying close attention to coupons. They’ve even sworn off dining out until their anniversary on Dec. 28.

And it seems they’re well on the way to their goal. The family, which includes two young boys, told MyFOXBoston.com that they’ve only spent $125 so far this year. Heather began her mission back in July 2008, feverishly clipping coupons and stocking up so the family would be prepared for their money-saving ‘09 adventure.

The family is documenting their efforts on their blog “Living on $1,500 for One Year.”

Their mission sounds like it requires a lot of discipline and even more time in the kitchen. I’m not so sure most would be up for the challenge — namely myself, and I’m only one person. That’s why this is one story I definitely plan on following. I’m very interested to see if the Spooners can pull it off.

Have you created a new 2009-specific budget for your family to cope in the current economy? Is it as severe as the Spooners’ 2009 fiscal plan? Has this family’s story inspired you to start one now?

If you’re a teacher or health services worker in the southern United States, you’re in a pretty good position right now. If you’re not, and in need of work, you might want to think about a career change and/or relocating down to Dixie. That’s because a new Job Openings and Labor Turnover (JOLTS) report says that, despite December’s job openings hitting the lowest rate recorded since the report started eight years ago, there are jobs available in health services and education.

In a strange twist, though, the professional and business travel industries reported the most hires in December, as well as the most layoffs, discharges and retirements.

The report’s findings also revealed that the South fared better for the amount of open positions than the Northeast, Midwest and West, though job openings have declined overall in all four areas of the country. That’s not encouraging news, considering the barrage of headlines detailing thousands of new layoffs every day.

Other than pinpointing where the jobs that still exist are, this report basically reinforced what I (and I’m sure you) already suspected: people aren’t just getting laid off from one job, they’re being shut out of the job market almost entirely.

Even New York City, the epicenter of business and a town that inspired the theme of “if you can make it there, you can make it anywhere,” is predicted to reach a startling 10.5 percent unemployment — well above the 7.6 percent national unemployment average and far above the low end of the scale, like Idaho Falls’ 1.9 percent unemployment rate.

So this begs the question: Where are the out of work supposed to turn? The South I guess… or maybe Idaho Falls.

Have we reached a point as a nation where mobility is necessary to maintain some semblance of our former lifestyles? According to a recent survey, most Americans are willing to relocate if it means finding a job. In fact, “59 percent of employees say they’d be willing to relocate to another city for a new job and 44 percent say they’d be willing to relocate to another state, province or region for a new job.”

What about you? Are you willing to move? And do you think the current job market will lead to a population shift in some areas of the country?

Today’s economy forces people to make concessions at every turn — and weddings are no exception. The countdown is on to “wedding season,” but the landscape of the wedding receptions in 2009 will probably look a lot different than it has in years past.

Over-the-top fairytale weddings are quickly becoming another casualty of a weakened economy. Bubbling brides-to-be all over America have to put their dreams of wedding-day grandeur aside in the face of cold, hard numbers.

CNN.com recently profiled a number of brides from across the country who ditched their dream wedding plans on account of the economy. Whether due to unexpected layoffs, or just reined-in budgeting, all of the couples had to cut back, and in some cases completely cut out, aspects of their weddings they previously thought were a given — like guest lists exceeding 250 people. Some couples chose one big item over another: an expensive photographer instead of a fancy reception hall, or cute cupcakes to replace an overpriced wedding cake.

While the thought of skimping on their “big day” might seem heartbreaking, all of the brides CNN talked to agreed that the main point of the day is to celebrate the marriage — not the wedding. If this is the “back to basics” America everyone’s talking about, I say, “cheers… to the bride and groom.”

Has the recession changed your wedding plans? Are you keeping all of the frills but fewer guests? All of the guests but fewer frills? Or are you sticking to your original big blowout plan?

Much the same way many Americans are taking a closer look at the way we spend our dollars, so too are the businesses looking to lure (or keep) us spending the dollars we do have in their establishments. In this new economy, no marketing tactic is too base, no idea too outlandish, even if it means turning a brand it’s taken years to build on its heels to remain a viable factor in our budgets.

We began cutting back on recreational shopping, so retail stores respond with a state of seemingly perpetual sales. We started driving less, and prices at the pump took a nosedive. Even car dealers chose to “assure” us not to be afraid to buy a new car; we can just return it if we lose our income — no harm, no foul.

Even Starbucks, a company known for catering to coffee aficionados looking for more than the average cup of joe — and previously willing to pay for it — quickly learned how much things have changed. The days of throngs of customers stopping by for their daily grande-half-caf-skinny-latte fix are proving to be a thing of the past. For many, that daily coffee run was among the first line items to hit the cutting-room floor, and the coffee-brewing giant has definitely felt the effects. Their business has dropped by 10 percent in the first quarter.

So to stay alive, a company built on coffee elitism is taking its cues from an industry designed for the Average Joe: fast food. That’s right, the house that yuppiedom built is willing to sully its reputation by offering value meals. (I’m sorry, discounted “pairings.”)

Starting March 3, instead of a $4 designer coffee, Starbucks fans can get a coffee and breakfast item or “artisan” sandwich for around the same price.

This latest development just seems like another sign that the economy has come full circle and shows how far we’ve moved away from conspicuous consumerism back to practical consumption.

What’s your take on Starbucks’ attempts to relate to the needs of consumers today? Will value meals lure you back to Starbucks? Did you ever leave?

Is it time to take advantage of a crashing housing market? If you ask around, it seems two schools of thought are emerging regarding the right time to buy a new home. If you have the means to purchase a home, some believe there’s no time like the present, whereas others are banking on deeper home discounts further down the road.

While it may seem counterintuitive in today’s economic climate — one rife with foreclosures and a skyrocketing unemployment rate — home prices are actually the most affordable they’ve been since the National Association of Realtors started measuring home affordability in 1970 (the Affordability Index is calculated based on home prices, mortgage rates and family income, and their relationship to each other).

If you’re in a position to buy a home and are looking for more than friendly opinions on the matter, MarketWatch.com’s Amy Hoak outlines “Five Reasons To Buy a Home This Year”. She points to first-time homebuyer perks like a $7,500 tax break (which could go up to $15,000 in the new stimulus package) and sellers desperate to move inventory and very willing to negotiate as reasons to jump into the housing game feet-first.

At the opposite side of the spectrum, Ms. Hoak also shares “Five Reasons Not to Buy a Home This Year”. She cites an unstable job market and housing prices that are predicted to continue to fall for at least the immediate future, and most likely through 2011, as justification for unsure buyers to hold back for a little bit longer.

The job-loss numbers in America are staggering. Every day, more companies announce layoffs, only increasing competition for the positions that are available. Job hunters need think creatively if they want to rise to the top of the resume stack.

Try these four job-hunting tricks to put yourself ahead of the pack:

1. Pull out all the stops. Aggressive job hunters may want to take a cue from Joshua Persky. He’s strolled New York City’s streets wearing a sandwich-board resume declaring “Experienced MIT Grad for Hire.” While it may seem a bit extreme, his stunt worked! He’s now employed as a senior manager at accounting firm Weiser LLP, thanks to a recommendation by a recruiter who saw him in all of his sandwich-board glory.If nothing else, Persky’s approach shows us that no tactic is too “out there” when looking for employment — and that creativity counts. If you’re not ready to parade around town wearing your resume, try hand-delivering it to businesses instead. This will give hiring mangers the opportunity to match an actual person with a name, setting yours apart from an inbox full of faceless resumes.
2. Use your social network page as a business networking platform. It’s important to put your best foot forward, even online. But in addition to tailoring your page as an interactive resume, take the opportunity to “friend” business acquaintances, former colleagues or anyone else who can help you with job leads and recommendations.
3. Check out alternative job boards. Websites like CareerBuilder and Monster are great resources for job hunters, but be aware that everyone else is looking there too. Instead, try Craig’s List or company websites where you’d like to work.Also, look into job boards specific to your industry, like MediaBistro.com for media industry professionals. From teaching to healthcare, construction to fashion, a simple Internet search will reveal job boards in many professions.
4. Make a video resume, and bring your image into the 21st century. If a picture is worth a thousand words, then a talking picture is priceless. A video resume is a great option to explore if you’re confident you can pull off a dynamic, professional-looking piece that will boost your employment opportunities.

It’s no secret that retailers saw abysmal Holiday 2008 numbers. Low consumer spending expectations were met by even lower actual returns — in many cases, 2008 marked the worst holiday spending season in decades. According to a Fox Business report, real consumer spending fell 1 percent in December — or 0.5 percent when adjusted for inflation — marking the sixth time spending dropped in seven months.

The Commerce Department says consumers chose to save “what they gained from falling energy prices.” Not a surprising notion in an economy where job security is almost nonexistent. In fact, the personal savings rate rose to 3.6 percent in December because spending is falling faster than incomes are, a hint at the new American economic consciousness.

However, economists agree that consumer spending is the most effective way to begin repairing a recession’s damage to the economy. So it seems that as a country, we’re stuck in a spending conundrum. Do we save to preserve ourselves or spend to preserve the economy?

With President Obama’s new bailout plan on the horizon, will Americans spend what they’re getting back in tax cuts, or will scared consumers continue to save or apply the rebate to practical costs, like monthly bills? Only time will tell.

Have your spending habits changed in the new economy? Are you saving more for a rainy day or doing your part to spark the economy?