Thank you all for the well wishes, kind words, and congratulations on our new family member! We’re all smitten and enjoying our time getting to know our rosy cheeked bundle of joy (and tears, and squeaks, and hiccups) and are starting to settle into a routine.

The Saved Quarter Challenge will return next week. I hope you’re continuing to push yourself to save and are working toward your goals!

Chickpea greeted the world in a hurry early Tuesday, our best Valentine’s gift – a healthy 8 lb. baby girl with a heart shaped mouth, loud voice, and that sweet new baby smell. She’s swaddled and sleeping peacefully in the bassinet beside me, seemingly unfazed by our adventure to get her here.

We arrived at the hospital for a scheduled induction on Monday, starting pitocin just after noon. I spent the next 12 hours with very mild contractions. They were close together but so mellow that I could talk through them the whole time. In that time I made it to just about 5 cm dilated, with her head not yet engaged. My goal had been to get past 5 cm without an epidural, my pain threshold with the first two, and this time I got to 5 with very little pain.

My doctor suggested that we break the bag of waters at midnight to help move things along, and boy, did it!  After breaking the waters, I had about 45 minutes of very strong contractions, but they were manageable with deep moaning breaths (getting in touch with my inner moose!), back massage, squatting on the exercise ball, and Mr. Penny verbally guiding me in visualization. At the end of that 45 minutes, the pressure was so strong that I was moved to the bed, so as not to deliver squatting on the ball, and then everything moved really, really fast. I went from 7 to 10 cm in just a few minutes and felt like I was underwater, unable to get a handle on the contractions anymore; the deep moaning breaths that had been helping were lost and I couldn’t stay with the visualization. I asked for the epidural but it was too late.

The nurse was paging for my doctor, residents, ANYONE to come RIGHT NOW. It’s all a vague blur to me, but Mr. Penny says it was a mad scramble of people trying to get in fast enough. My mom, a labor and delivery nurse herself, helped a resident into her scrubs and gloves and put the receiving blanket on my chest. Someone was telling me, ”Don’t push! Don’t push!” and I was struggling to breathe (instead of scream!) and not push, but my body wasn’t listening. Chickpea came all at once, all on her own; the resident made it just in time to catch her. My doctor made it to the room a few minutes too late.

I went from breaking the waters at 5 cm dilated, with her head not even engaged, to her being born in an hour and 15 minutes!  By comparison, Sweet Pea was a breeze at 8 hours of active labor after Peanut’s 28 hours! I pushed for 2 hours with Peanut, 5 minutes with Sweet Pea, and this time, I was attempting to *not* push when Chickpea was born.

While I was pregnant, Mr. Penny had joked about Chickpea coming out “like a waterslide.” I told him then that it wasn’t nice to compare your wife to a waterslide, but this birth really was like that – once the water broke, out she came!

We came home this afternoon and are getting settled in and getting to know one another.

After postponing our delivery last week (we had a house full of sick kids), we’re finally off to have our baby this morning! Wish us luck!

When I was pregnant with Peanut, I found the book Baby Bargains by Denise and Alan Fields. It’s a fantastic resource for expecting parents, giving detailed advice on how to pick the right gear for your lifestyle, brands and models of equipment that are a good value, and what to skip.

As much as I appreciated the book for learning what I needed as a new mom, I’ve found through experience with my first two kids that I can make do with a lot less stuff, and spend a lot less than they recommend.  This time around we’re going much more minimalist on the baby gear, saving both money and space in our small home.

How much does the average parent spend on baby supplies?

Baby Bargains has a list of the supplies needed for the average cost of having a baby, and cost based on industry estimates for a child from birth to age one. (These numbers are from the 9th edition.)

Crib, mattress, dresser, rocker  - $1,375
Bedding/Decor – $345
Baby Clothes – $630
Disposable diapers – $890
Maternity/Nursing Clothes – $1,210
Nursery items, high chair, toys – $520
Baby food/formula – $1,485 (exclusive formula feeding
Stroller, car seats, carrier – $675
Miscellaneous – $600
Total – $7,730

With their tips for careful shopping and avoiding superfluous extras, the Baby Bargains authors suggest that you can shave it down to $4,196. That’s still far more than I’m spending on Chickpea, our third child, in large part because I’m happy to buy and use second-hand supplies. Craigslist, garage sales, thrift stores, and hand-me-downs have definitely figured into our savings. Baby gear is often outgrown before it’s worn out and you can certainly find substantial savings going this route!

My total expected expenses for the first year add up to $2,029.50, and including exclusive formula feeding, furniture, clothes, diapers, and a few extra just for fun items. Of course, I do have some hand-me-downs from my older kids, but it seems that most new moms receive at least a few hand-me-downs from family or friends or have a baby shower to help defray those first year costs. We’re not having a shower this time around.

How much am I spending on the first year of baby gear and supplies? 

Crib, mattress, dresser, rocker – $281.50
We had a crib for Peanut and Sweet Pea, but passed it along to another family so it needed to be replaced. Cribs are something I would generally suggest buying new because safety standards change over time and you don’t want your baby to be in an unsafe crib. That said, we accepted a gently used crib in excellent condition for $60, checked that it was not part of any recalls and meets current safety standards, inspected it thoroughly, and double checked the hardware and installation instructions to be sure it was put together correctly. Although drop-sided cribs are no longer recommended, I used one with the first two kids and feel that they’re safe when installed and used correctly, so I am comfortable with using one this time around. This crib can also be used as a toddler bed, which we’ll likely take advantage of until Chickpea is a few years old. New cribs can be found at a similarly low price at IKEA, which is where we purchased a new crib mattress for $70.

I also bought a second-hand Arm’s Reach Co-Sleeper Mini Convertible for $80 (again checking for recalls and inspecting it thoroughly), which will be the bassinet in our bedroom for the first few months until the baby is sleeping through the night. Our room is a little small to fit the full sized crib and still be able to walk, but the co-sleeper tucks into the corner without taking over. It’s also convenient for having the baby sleep next to us, so I can reach over and touch her in the night for soothing, without having her in our bed. When Chickpea outgrows it as a bassinet, I’ll move it to the living room in playpen form as a safe place for her to play when I need to put her down for few minutes, or for a portable bed when we travel. The one I bought came with two organic sheets. While we could do without the co-sleeper, it is a convenient extra that deserves its spot in our home.

Our changing table was a thrift store score for $30 and am using bins I already had to store clothes, cloth diapers, and supplies. I bought a gently used changing pad with three covers for $15 on Craigslist, about the same the same price one new cover. A diaper bin was also found on Craigslist for $10, and we’re using a new Planet Wise wet bag ($16.50) as a bin liner.

We’re skipping the rocking chair this time around. We had one with the first two kids and it turns out that I just don’t love rocking babies. We donated the chair last year. Instead we’ll stick with the most used piece of baby equipment in our home, a fitness stability ball that I’ve used during 2 labors and one on the way, and to bounce two babies (and then toddlers, and occasionally preschoolers) to sleep over the past 6 years. I spent $15 on it 7 years ago and it’s still going strong.

We also passed on the baby monitor. Our house is small and I can hear crying from anywhere in the house!

Bedding/Decor – $0
The baby will share our room for the first few months, then she’ll move into the kids’ room, so there isn’t a nursery to decorate.

We’re skipping the wall decorations, comforter, bumpers, crib skirts and such. It’s all adorable, but soft bedding is not recommended for safety reasons and a matching set is not necessary. In skipping the bedding set, we still need to make the bed. I had two crib sheets and two Ultimate Crib Sheets in the linen closet leftover from our two previous crib sleepers. The Ultimate Crib Sheets are a waterproof layer attached to a cotton topper, and it snaps on top of a standard sheet. If baby has an accident in the middle of the night, you don’t have to wrestle with the mattress to replace the sheet. Just snap off the top layer and a clean layer is underneath. The decorative sheet shows from the side and never gets soiled. (We have one regular sheet that covers the mattress, leftover from previous kids as well.)

We’ll keep the baby warm with hand-me-downs of my very favorite stretchy 30″x40″ double-layer jersey cotton blankets. They’re on their third kid and still have lots of stretch left in them!  Lots of parents swear by specialty swaddling blankets, but we haven’t used them. We didn’t find swaddling with a regular blanket all that difficult, especially with a bigger, stretchy blanket, and regular blankets are multi-taskers, useful for tummy time, covering the carseat from the sun, emergency spit-up rag, etc.

I also have several Halo Sleepsacks  in different sizes, left from the older kids. Sleepsacks are like zip-on baby sleeping bags; I like these once the baby has outgrown swaddling because the baby doesn’t wake up cold after kicking off blankets and there less chance of them getting tangled up in blankets and suffocating.

Baby Clothes – $50
I’ve spent $50 on baby clothes so far and have the first 12 months covered. You can see Chickpea’s minimalist newborn wardrobe and my method for clothing kids close to free.

Diapers – $100
I’m using cloth diapers on a budget, and between hand-me-downs, clearance finds, and a simple system, I’ve spent $100, not including laundry. I should have enough to last through potty training.

Maternity/Nursing Clothes – $280
I spent $100 on (ugly but supportive!) maternity underwear and a Bella Band, and $180 on my Project 333 maternity wardrobe.

Nursery items, high chair, toys – $100
My first two kids used a Fisher Price booster chair strapped onto a dining chair, perfect for a small home without room for a high chair. This baby will be using the same chair.

We haven’t bought a swing. One of our babies LOVED it, the other one screamed bloody murder if we put her in it, so we’re going to wait until Chickpea is born and test it out before buying a second-hand swing if she likes it.

I did buy a bouncer seat and Gymini playmat as part of a $50 lot on Craigslist that also included a small diaper bag, temple thermometer, several toys, travel formula dispenser, carseat head support pillow, pacifiers in a new package, and a few other odds and ends. Lots are a great way to get a variety of items to try without spending a lot of money!

I already have a great all-day diaper bag (Land’s End Do-It-All bag) that I used both for Peanut and Sweet Pea and still looks great. I had the baby comb, brush, Nose Frida snot sucker (read the reviews – this is so much better than the squeeze bulb type!), and nail clippers. I also had a basket of baby toys from the older kids and haven’t bought any new toys.

I have a good supply of Dr. Bronner’s baby mild soap, lotion, diaper rash cream, hand sanitizer,  all bought wholesale through the Frontier Co-op for a little less than $50. I’ll be surprised if it’s all used up in the baby’s first year! We didn’t buy a baby bathtub this time around; the sink with a folded towel laid down for comfort works well for little babies, and we often take baths with our babies when they’re small. (A wet washcloth between me and baby helps keep them from slipping around while soaping up!) We had a baby tub for Peanut but used it so little for him that we skipped it for Sweet Pea, and will skip it again.

Baby food/formula – $630

I bought a set of glass Dr. Brown‘s bottles on Craigslist for $80, kept 6 small and 6 large bottles, a few spare parts, and bottle brushes, then sold the remainder of the lot for $50. My cost for the bottles I kept was $30. These bottles aren’t cheap but are well recommended, so I was pleased with this affordable second-hand find.

We’re formula feeding this time around, and I calculated the cost for a year of formula to be roughly $600. (You can read about my breastfeeding experience to see why we’ve chosen to formula feed this time around.) We skipped the sterilizer and bottle warmer.

I don’t intend to buy jarred baby food. It’s easy to mash regular fruits and veggies, freeze it in an ice cube tray that we already have, and voila! baby food for a fraction of the price. That will just be part of our regular grocery budget.

Stroller, car seats, carrier – $288
I bought a very gently used Sit N Stand stroller on Craigslist for $50. The previous owner took it on one trip to Disneyland and it never left her garage again, so it’s in fantastic condition, for 1/3rd of the original price!

I won’t buy second-hand carseats for safety reasons, but I did search out sales and used discounts to get an infant carseat and a convertible seat. The infant carseat was $54; the convertible seat is a Sunshine Radian was on a year-end clearance for $184, down from $250.

The nice thing about the Sunshine convertible seat is that it will fit three across in a compact car. We swapped out Sweet Pea’s convertible seat (which had previously been Peanut’s and was ready for retirement) for the Sunshine. It fits nicely with the infant seat and Peanut’s booster seat in our small car. By the time the next baby is ready for the Sunshine, Sweet Pea should be ready for a booster seat.

I have a Baby Bjorn and a sling from the first two babies; Peanut wasn’t a cuddly baby and preferred a stroller, but tolerated the Bjorn. He hated the sling. Sweet Pea, on the other hand, wanted to be held 24/7 and lived in the sling! We’ll see what this baby prefers, but the bases are covered.

Miscellaneous – $300
Although I think I’ve covered most of my bases, I’ve kept $25 a month in my budget for baby supplies as little needs come up. I don’t know where that will go, but it’s a good idea to room for incidentals when crafting a budget! So far, I’ve spent $12.50 on a baby book as a miscellaneous expense.

*****

This is how we’ve outfitted our baby with the gear and supplies we anticipate needing for the first year on a slim budget. As with all things baby related, your mileage may vary. The things we found unnecessary may be the things that save your sanity! I’d love to hear how you’ve saved and what products you found indispensable with your babies. 

Hi, everyone! I’ve been absent from blogging this past week as I get everything ready for the impending arrival of our newest family member later this week, but I don’t want to leave my Saved Quarter Challengers hanging! I hope you’re still working toward your goals, and I’ll be back to check in with you soon.

Welcome back, savers! How are you doing on your goals this month? Are you sticking to your budget? After checking out your credit score and report last week, did you find any surprises?

This week, I want you to tackle your credit from another angle. I want you to make a payment plan to eliminate your debt and call to renegotiate your interest rates. Over the life of a loan, interest can cost hundreds or even thousands of dollars. With interest rates so low, this is the time to try to lower the rates you’re paying and save that money!

Step 1: 
Gather all of your loans in one place – mortgage, student loans, medical bills, car notes, credit cards, money you might owe to a family member, whatever you owe to anyone. Write a list with the full balance due, interest rate, and contact phone number.

Step 2:
Call and ask for a lower rate! The better your credit, the more leverage you have to get a better rate, but it’s worth asking even if you do not have perfect credit.

Craig at Free From Broke wrote a great post outlining sure-fire ways to renegotiate your credit card debt. He suggests asking for a lower rate, negotiate fees, offer a lump sum, requesting a lower minimum, and rephrasing your request, and asking to speak to a manager if necessary. Read his post for more details, and of course be polite but firm in your requests.

Student loans can be renegotiated once in the lifetime of the loan. Are current rates low enough now to warrant renegotiating now? How about your mortgage? Could you save more by refinancing than you’d pay in closing costs?

It hurts nothing to call and see if your rates can be lowered and you might be pleasantly surprised to find unexpected savings here.

Step 3: 
Continue paying the amount of your current bills, even if the rates are reduced, to pay your debt off faster. If you have multiple debts, consider setting up a debt snowball this week as well. The method, popularized by Dave Ramsey, works as follows (from Wikipedia’s entry):

The basic steps in the debt snowball method are as follows:

• List all debts in ascending order from smallest balance to largest.
  • This is the method’s most distinctive feature, in that the order is determined by amount owed, not the rate of interest charged. However, if two debts are very close in amount owed, then the debt with the higher interest rate would be moved above in the list.
• Commit to pay the minimum payment on every debt.
• Determine how much extra can be applied towards the smallest debt.
• Pay the minimum payment plus the extra amount towards that smallest debt until it is paid off.
  • Note that some lenders (mortgage lenders, car companies) will apply extra amounts towards the next payment; in order for the method to work the lenders need to be contacted and told that extra payments are to go directly toward principal reduction. Credit cards usually apply the whole payment during the current cycle.
• Once a debt is paid in full, add the old minimum payment (plus any extra amount available) from the first debt to the minimum payment on the second smallest debt, and apply the new sum to repaying the second smallest debt.
• Repeat until all debts are paid in full.

In theory, by the time the final debts are reached, the extra amount paid toward the larger debts will grow quickly, similar to a snowball rolling downhill gathering more snow (thus the name).

How are you going to take on your debt and interest rates this week?

The Challenge Link-Up

Here are the Saved Quarter Challenge rules:

• Each week, write a post on your blog about your money-making and saving adventure, how you’re doing it, how much you’ve saved, and your experiences with the challenge.
• Every Monday, link the permalink of your post in the linky , and include a link back to The Saved Quarter on your post. Posts not including a link back may be removed.
• You can include this banner if you like. Just save it to your computer and upload it to your post or picture hosting site. I’d love it if you include a link back to the image!

• If you’re not a blogger, post your week’s savings highlights in the comments.
• Visit the blogs of other challengers and give them encouragement and feedback.
• Please do not host your own Linky of the challenge.
• No spam or advertising posts.

Sorry for the lack of posting. It’s been hectic around here as we get ready for the new baby!

After this week’s prenatal appointment, my doctor has scheduled me to be induced the on February 8, or approximately 10 days from now! This is two weeks sooner than we’d originally discussed. The baby stuff is pretty much set – bassinet, and changing table are ready for a tiny occupant, bottles are washed and stored in the kitchen, and the car seat is strapped in and ready to bring home the baby.  But I’m scrambling to finish projects – filling the freezer with healthy meals for post-baby, cleaning ALL THE THINGS!, finishing up baby crafts, spending time with the kids.

My to-do list is too long and it will pretty much consume me until the baby gets here, so I’ll be posting less frequently for the next few weeks. Thanks for continuing to read and for being patient with me!

Baby Chickpea is due in a little less than a month, but took a fall earlier in the week that landed me in labor and delivery with contractions for an evening of monitoring, pushing up the reality that we could have a baby any time now. They sent me home when contractions stopped, and baby and I are both fine, but it was a tense day at the hospital and I’m more sore and achy than usual.

I’ll be back next week with another Saved Quarter Challenge, a giveaway, and tips on saving on textbooks for students returning to their spring semester of classes!

Welcome back to The Saved Quarter Challenge! I loved seeing your budgets last week and am excited to see your savings ideas starting to produce results! This week, we’re going to take charge of our credit report and score. An important step toward financial stability is a good credit score. Knowing and maintaining your good credit will help you to reduce your car or home loan interest rates and lets potential landlords and employers know that you’re reliable. It’s also important to regularly check your credit report so you can avoid identity theft. This week, I want you to find out where you stand and make a plan that improve your credit. The action plan:

1. Get a free copy of your credit report and credit score. * You’re entitled to a free copy of your credit report from the big three credit bureaus (Transunion, Experian, and Equifax) once a year through annualcreditreport.com. You can get all three now, or get one now, one in four months, and one four months after that to keep track of your report throughout the year. * You can see your credit score for free on Credit Karma. I like their “credit simulator” tab, which shows how your score will change if you make changes such as adding or closing a card, paying off debt, or missing a payment.
2. Repair inaccuracies There may be errors on your credit report, and you have the right to dispute inaccuracies. Go over your report with a fine toothed comb and send a letter to the credit bureau detailing any inaccuracies.  At the same time, you can add positive information, such as accounts that you’ve kept current but haven’t been added for whatever reason; be sure to include your account number so the credit bureau can verify it. You can also ask that they remove information that is more than 7 years old (ten years for bankruptcies). They have 30 days to verify errors, and if it can’t be verified, it must be removed from your report.
3. Add a statement to negative entries.  If you have extenuting circumstances that have had a negative effect on your credit score, you can add a written explanation so your side of the story shows up.

Get started in evaluating and improving your credit, and in future weeks, we’ll work on eliminating debt and renegotiating interest rates for ways to build it up. I’d love to hear what you find when you’re examining your report. 70% of reports have errors – is yours one of them?

The Challenge Link-Up

Here are the Saved Quarter Challenge rules:

• Write a post on your blog about your money-making and saving adventure, how you’re doing it, how much you’ve saved, and your experiences with the challenge.
• Link the permalink of your post in the linky , and include a link back to The Saved Quarter on your post. Posts not including a link back may be removed.
• You can include the banner if you like. Just save it to your computer and upload it to your post or picture hosting site. I’d love it if you include a link back to the image!
• If you’re not a blogger, post your week’s savings highlights in the comments.
• Visit the blogs of other challengers and give them encouragement and feedback.
• Please do not host your own Linky of the challenge.
• No spam or advertising posts.

I haven’t blogged as much as expected this week. A time-consuming turn of events is my discovery of the Feingold diet. My daughter, as you may have read, has a salicylate intolerance. I’ve been trying for close to two years to keep her rash- and hive-free, noting a clear connection between the foods she eats and the angry red reactions. We’ve done okay but she has still has unexplained reactions routinely and I just couldn’t figure out what it was.

At the same time, my son’s kindergarten teacher has been telling us that his fidgeting and wiggling is distracting him from learning, and he has trouble with focus and attention in class. He’s repeating kindergarten with the same teacher, so she knows him well and this has been an issue since last year. She recommended that we have him tested for ADD. He’s also had a non-stop drippy nose throughout the school year.

An appointment with our pediatrician let me to an A-HA! connection. He suggested that the drippy nose and Sweet Pea’s food reactions are likely the same allergies, as is my asthma. Allergies, asthma, and eczema are often interconnected. I came home and did a little web-sleuthing only to discover that some kids also have ADD symptoms from salicylates! With a known family history of trouble with salicylates and with ADD, this is something I definitely want to explore. It may not be the singular solution to all of our issues, but if an adapted diet makes a difference it’s definitely worth looking into.

The Feingold diet eliminates food additives like food dyes, artificial sweeteners & flavors, some preservatives, and naturally occurring salicylates. They have a handbook and manual, which I ordered, and while reading through them I had another A-HA! So many foods I’d thought were safe for Sweet Pea have hidden preservatives and MSG, including the vitamin D in milk, MSG in tuna fish, and even something in her toothpaste! No wonder we could never quite get it under control!

Even if Peanut’s attention issues are not helped by the change in diet, the materials and shopping list are already helping me to shop better for Sweet Pea. We’re all going to eat the Feingold diet together for the foreseeable future, but I think my food and household/personal care budget will need to be upped to make it work. I’m going to try to keep us under budget for January and re-evaluate in February.

Since my last budget check-in, I’ve spent just under $40 on groceries, but the receipt went through the laundry in my jeans pocket so I can’t give you an exact list of what I bought. This trip included 2 gallons of milk, butter, eggs, yogurt, lots of bananas, 3 lb. pears, celery, green beans, Brussels sprouts, tuna, organic chicken (on clearance), breakfast cereal, whole wheat noodles, and pretzels.

How was your first week of The Saved Quarter Challenge? Did you make a specific, measurable goal with a deadline? Ready for your next step? This week, I want you to:

Make a budget and pay yourself first

In my opinion, budgeting is not optional. Like goals, budgets are plans, and my marketing professor would remind you that plans are important because they help you to put your most important resources on your most important goals. With a budget, you make the choice over how to use your most important resource – your money – to support your most important goal, whatever you decided your goal to be. Budgeting helps you to be in control of your money and live within your means, making you prioritize your spending so your needs are met before your wants. If you haven’t made a plan, it’s easy to overspend on wants and be blindsided by irregular expenses.

Have you been writing down every penny? That will make it easy to see what you’re really spending your money on so you can better evaluate how you want to allocate your money. If you haven’t started, I would definitely recommend writing everything down for at least a week, if not longer, so you can get the honest feedback of your real life expenses and make the changes that will positively affect your savings goals.

There are many ways to do it, from a pad and paper to any number of software and internet-based programs. I personally use and love the book The Budget Kit by Judy Lawrence, specifically for two of the dozens of forms: the yearly budget worksheet for non-regular expenses (like property tax, heating oil, car registration, school yearbooks, the veterinarian, etc. – things you know you’ll need to pay for but aren’t due each month), and the monthly expense record. The yearly budget worksheet helps me to plan for things that don’t come up every month and used to throw me off budget. Now, I’ve made a list of everything I could think of for the year, added it up, and divided by 12 (months), adding that amount to my monthly budget so that I have money to cover those expenses as they come up. You can see how I’ve done that in my 2012 annual budget. The monthly expense record is used, as you might expect, to record expenses. It’s easy to see where my money is going and if I’m staying on track for the month.

Come back tomorrow and enter to win a copy of the book or Judy’s new Droid app! 

I also use a cash envelope budget. It’s not right for everyone, but if your spending is out of control, it is an effective way to reign it in. The idea is that you make your budget and put the cash amount for each category in an envelope. When you’ve spent it, it’s gone, and you have to wait until the next pay cycle to refill it. There are no late fees, no overdrafts, no declined cards at the checkout counter, and no interest when you pay cash, and there is no fudging how much you’re actually spending. It’s easy to spend an extra $10 or $20 on a credit card, but when you don’t have the cash, you can’t overspend it. I occasionally need to borrow from another envelope, but that means that I can’t spend as much in the second category; the amount is finite and I can’t overspend.

Put paying yourself at the top of your budget along with rent or mortgage as one of the first things paid each month. If you can, have the amount directly deposited into your separate bank account so you don’t even have to think about it.  You deserve the financial peace of mind that meeting your goal will bring, and you deserve to save part of what you’ve earned to keep for yourself. You are every bit as worthy of your money as the electric company, Visa, and the shoe store!

There are two ways to go about paying yourself first.

1. Pay the full amount of your monthly goal like it’s a bill at the beginning of the month and live off the remaining paycheck. Supplement with additional income if necessary.

2. Pay a portion of monthly goal amount and complete the monthly savings with supplemental income.

I used the second method, and it’s been effective for me because our income doesn’t leave room for me to pull the quarter out at the beginning of the month and still meet my monthly needs. You might find that you can contribute 10% to your 401(k) and 15% direct deposit into your savings and still be able to meet your needs, even if funds are a little tight, in which case the first method might be better for you. However you choose to do it, make it as automatic as possible and make it a priority on the same order as your housing. You wouldn’t skip your house payment unless you were in dire straights, and paying yourself should be just as important.

Do you have a budget? Are you paying yourself first? Tell us about it in your link-up this week! If you are comfortable, share your budget and/or any areas that you’re having trouble with so that other savers can offer suggestions of how you might meet your needs for less!

The Challenge Link-Up

Here are the Saved Quarter Challenge rules:

• Write a post on your blog about your money-making and saving adventure, how you’re doing it, how much you’ve saved, and your experiences with the challenge.
• Link the permalink of your post in the linky , and include a link back to The Saved Quarter on your post. Posts not including a link back may be removed.
• You can include the banner if you like. Just save it to your computer and upload it to your post or picture hosting site. I’d love it if you include a link back to the image!
• If you’re not a blogger, post your week’s savings highlights in the comments.
• Visit the blogs of other challengers and give them encouragement and feedback.
• Please do not host your own Linky of the challenge.
• No spam or advertising posts.