For a long time, Tara and I had a saving account through Chase that we kept our emergency fund in. Having it in there was good because it was immediately accessible, but it had a very low interest rate at .01%. I think over the 4 years the most interest we would accrue was 2 cents a month. I wasn’t super worried about the interest rate because the money wasn’t in there to make money, but about 2 years ago, Tara and I started saving for a down payment. We put that money into an online savings account with Goldman Sachs who has a savings account called Marcus with a 1.5% interest rate, no fees and no minimum balance to earn the interest. After a little while, I started to think of how much our emergency fund could earn if we put it in this Marcus account. The only downside is that the funds wouldn’t be available for 2-3 business days, so Tara and I talked in depth about what sort of emergencies we would need to pay for immediately. We couldn’t think of many that we couldn’t just put on our credit card, pull out the emergency fund money and then apply towards the card in less than three days. I consulted Jacob and my dad beforehand too and they were all in agreeance, so that same day I moved our money to the Marcus account, keeping $500 in the Chase account.

If you don’t use credit cards, having your funds available to you immediately is going to be more important. If you do have credit cards, this might be a good option for you. We use credit cards for travel points anyways, so being able to get those would make it worth it for us.

Why we recommend Marcus

The Marcus account now has a 2.25% APY. In the time I’ve had this account, the percentage rate has gone up almost an entire percentage point and is one of the highest interest rates I can find for an online savings account. When you add on the fact that there are no fees and no account minimum balances to earn the interest, it makes a lot of sense to have this account. Whether you are using it for your emergency fund or just for general savings, we highly recommend Goldman Sach’s Marcus account.

You can sign up for Marcus through the widget on the sidebar, they also recommend Marcus as their top online savings account. Or use this link.

Thanks for reading! If you have any questions, feel free to comment below or send us an email at thefundfamily@gmail.com. Feel free to

Part of becoming financially independent is to create a team around you that will help you achieve success. The purpose of the fund family interviews is to help you get to know people who are doing the right things to become financially independent. Our goal is that you will find people that will inspire you to do better. Their stories will vary, but all will have something to say that will help you in your own personal journey. To see past interviews, go here.

Personal

Today’s interview is with Kesley and Ryan Bench

Name: Kesley and Ryan Bench

Age: 22

Your home location: Provo, Utah

Career/Source of regular income: Kesley: Nanny Ryan: Carpentry

What do you do for fun?  K: I play soccer and read R: Play sports, listening/playing music

Success Tips

What has led to your success?

K:Working hard. But also having people around me who are always supporting me

R: Having goals that I can achieve on a weekly, monthly and yearly basis

Advice to people trying to achieve success?

K: Having a goal at what they are trying to achieve, and then working hard to get it done.

R: Know what you want. Not knowing what you want in life makes it hard to truly have success.

How do you measure success?

K: If I accomplished my goals. Or if I gave my all

R: If you do the best you can and learn as much as you can along the way.

What are your success habits?

K: Always giving it my all

R: I have a schedule that I try to stick to weekly that I have saved on my phone

Financial Independence/Retirement Plans

What does financial independence (FI) mean to you?

K: Being able to have enough income from outside sources that we don’t have to work anymore.

R: I’ll echo what Kesley said and add to spend less than what we make.

Do you have plans for financial independence/retirement?

K: We don’t have a specific goal in mind, but sooner rather than later.

R: I don’t have a goal right now

Why do you want to achieve retirement/financial independence?

K: Because I want to retire early so I can travel, or spend time with family. Without the stress of working.

R: So I can pursue other hobbies and develop my talents in woodworking, piano, etc.

If you had to start over, what’s the most important thing you would focus on?

K: I mean I’m pretty young as it is, but I do wish I would have started saving earlier, even when I was in high school.

R: Invested earlier  

Do you have a budget? If so, how do you implement it?

K: I do, my husband and I use the app EveryDollar and we stick to it every month.

R: Yes, we’ve done it through trial and error, but now it’s a habit.

Do you give to charity? Why or why not? If you do, what percent of time/money do you give?

K & R: Yes we give %10 of our income to our church

That wraps our interview with Kesley and Ryan. If you have questions for them, feel free to comment below. If you are interested in being featured on the fund family interviews, leave us your info on our contact page.

Final Budget-to-actual

Our original budget for the trip was $2,591.60 and we ended up landing at $2,652.46. I will note, however, that this amount is our best approximation of what we actually spent and is not 100% accurate. One thing that made it difficult is that quite often, we would get to a restaurant and one of us would pay for the group with cash, then for the next meal the other couple paid for us on the card to make up for it. This pattern continued the whole trip, so it was pretty difficult to track what the exact dollar amount was for food between all the cash and the cards. So keep that in mind as I continue.

Looking at results above, one of the biggest reasons we came in at about $61 over budget was due to a tourist tax we had kind of heard about before the trip, but did not take into account completely while budgeting. That was a rookie mistake on our part, but for future travelers to Rome, keep in mind that AirBnB’s will charge you a tourist tax that the city imposes on travelers for accommodations.  That was kind of a bummer, but luckily it didn’t set us back much.

Another reason was due to us being a little to optimistic about the cost of the AirBnB in Rome and the hotel in Newark. We could’ve gone cheaper if we wanted, but we would’ve sacrificed some benefits that ended up being more convenient and time-freeing than other options. Which we’re OK with, considering time and convenience are worth a lot on vacation.

Glancing at the rest of the bugdet-to-actual, a lot of the budget surpluses and deficits cancelled each other out. These items were things that generally occurred due to changes to our plans while in Italy (e.g. not paying to visit certain Duomo sites because they were fully booked and we couldn’t do it; or not needing a sim card after all because we found other ways of making it work, etc.)

Judge us how you will, but overall I’m pretty happy about where we landed. Sure, we spent more than we budgeted, but considering some of the things that came up and our overly-optimistic views of some expenses, the final result of a $61 deficit is something we can live with. But stopping there would not be a great budget review. Whenever my wife and I budget, we like to not only see what we did well on and what we could improve, but we also like to talk about what we learned that we can apply going forward. So let’s talk about the lessons we learned!

Lesson 1: Build flexibility into the budget

Anyone who has ever budgeted knows that it is pretty difficult to always be 100% accurate and on-target with a budget. This trip was no exception. It’s hard to know and plan for every little expense that comes up. You never know how much you will use public transportation while you are traveling, or how much the food will actually cost. In our case, we rarely used public transportation in Florence like expected cause the city was much more walkable than we expected. Also, most restaurants had a cover charge that we didn’t really know about ahead of time. Little things like that can throw your budget off really quick, and assuredly will.

This trip was just another testament that it is important to build in some kind of flexibility into your budget. You can do this by either over-estimating on expenses or creating a “flex account” for your budget. My wife and I try and do this for our personal budget so that way unplanned or unforeseen expenses don’t throw us off in any way.

Lesson 2: Be willing to pay for extra time and convenience

When we first planned for the trip, we were all about cutting costs and finding the cheapest available options. After some planning and especially after the trip, we realized that sometimes it’s worth it to pay more if it means freeing up time on your trip. When you only have a week or two on vacation, you want to be able to use every second you can doing the things you actually want to do. This means that you might want to pay a few extra bucks to get a train that goes from Rome to Florence without stopping instead of a cheaper option that has multiple stops. Or it might mean paying more for one AirBnB/hotel because it is closer to public transportation or the sites you want to see. Flights can be included in this conversation as well, but for us, we are trying to find a balance between traveling cheap and traveling conveniently. One day, we hope the cost won’t be an issue and we can spend more on flights. But until then, we are all about traveling on a budget!

Lesson 3: Budget first, then forget about it

This lesson applies more to vacations than it does for regular budgeting, but it is super important to budget before you leave on your trip, then once you arrive at your destination, FORGET ABOUT IT AND ENJOY YOUR TRIP! Now, I’m not saying to throw your plans out the window and go crazy with your spending, but don’t just sit there and worry about your budget. You are supposed to be on vacation after all! If you make a solid plan ahead of time, then you’ll know what things you should and shouldn’t do with your money on your trip. Flexibility, as already mentioned, is also important on the trip. For example, we had some nights when we splurged on dinner, and others when we found cheaper options. In the end, we knew it would all average out and it did, and we were pretty close to our estimate. If you have a plan, it is easier to know when to make concessions with your spending, and when to be more frugal without having to think about it too much.

Going forward, I think these 3 lessons will help us in our future budgets, particularly with our vacation splurges. We are so excited to start planning for the next trip! Hopefully, we can continue to find ways to save money while still making the most of our trips! We would love to hear from our readers about any ways you are able to strike a balance between being frugal and enjoying your trips. Comment below and share any ideas, thoughts, and experiences you have had! We are all learning together

Set financial goals and ask yourself Why

With any area of my life, I have found it is very important to set goals. In the case of finances, you want to make sure you have purpose behind your penny pinching. If not, you will find that you fail so much more easily because there is no purpose or reasoning behind it! When we had debt, our reason for frugality was to be able to pay off the debt as quickly as possible. Since we’ve been debt-free, our reasons have become a little more fun, such as saving to buy a home, travel and vacations, and making memories.

Create a budget and check in with it!

Use the envelope system

We have also discussed just how helpful and effective the envelope system is before, but want to reemphasize just how much it will help you to be successful in your finances! It helps you take control of your spending and be more conscious of where your money is going. There was a study done that shows consumers who pay with credit cards focus more on the benefit of their purchase, while those who pay cash concentrate more on its cost. That is because there is an emotional pain associated with handing over physical currency, as opposed to swiping a credit card where that money is out of sight and out of mind. There are so many benefits to using the envelope system and I strongly encourage you to look more into it here!

Look at every purchase as an investment

Identify your spending weaknesses and address them!

By having a budget and tracking your spending you should be able to account for every dollar. Take a look at your expenses and see where you are unnecessarily spending. For some this is picking up unplanned and unnecessary items at the grocery store, online shopping, or buying a soda every day. Whatever your weakness may be, come up with a few ideas on how to combat them. If you find yourself always throwing extra things in the shopping cart at the grocery store, maybe try ordering your food online and picking it up! This way you track your spending while you shop and can resist impulse buys. If online shopping is your downfall, try unsubscribing from the shopping email lists, or following shops on social media that make you want to spend spend spend!

Read books or listen to podcasts that will help educate and motive you financially

Italy has always been towards the top of my bucket list. There is something about ancient cities and sites that really appeal to me, so being able to see structures that are upwards of 2000 years old is going to be pretty amazing.

When it comes to traveling, we are mostly exposed to the highlights of peoples’ vacations: the photos, the videos, the stories, etc. But we don’t always know what kind of work goes into planning it. We in the Fund Family, however, like to keep it real. Which is why we are not only going to share the highlights, but also the behind-the-scenes planning that is going into this trip. Hopefully this will be enlightening to aspiring travelers as to how you can save money and make those dream vacations a realistic option. That being said, we are still learning! So if you have any tips and tricks that we don’t share, let us know in the comments below!

Trip Overview:

Before we get into the nitty-gritty, let’s talk about the background:

Date: Early May

Length: 10 days (including 2 travel days)

Cities to Visit: Rome, Florence, Cinque Terre

Flight Details:

Outbound: SLC > SFO > EWR (NYC) > FCO (Rome).

Inbound: FCO > EWR (NYC), JFK > LAX > SLC

Transportation in Italy: Public transit, trains, walking

Budget: ~$2,600

Planning the Trip

This trip has actually been in the works for over a year. We were originally planning on going to Italy last April-ish (2017), but then Carlee and I found out we were having a baby and we thought that it would be best if we didn’t spend all that money on a vacation and instead save it for the new baby. But the stars aligned, the idea never died, and here we are about a year later finally getting to go on that trip! We didn’t think we could make the trip this soon, but we’ve worked hard and have been very blessed to be in a situation to be able to go. It also helps to be finally graduating from my Masters Program, so now I have an excuse to go! We are also planning on bringing our babies with us, which is an exciting, but also a little nerve racking thought. A lot of our plans and ideas are being made with this in mind. Because we are traveling with kids, we may not be able to vacation quite as hard as we would otherwise. But that’s ok! Hopefully we will learn a lot from it and make some awesome family memories.

Budgeting for the Trip

To be honest, it bothers me when I see those YouTube videos or articles telling people they can travel the world for $500. Maybe some people are crazy good at planning and making things work, but for us normal people, that is more of a dream than a reality. Our original goal for this trip was to do it for less than $2,000, but as we started planning what we actually wanted to do and see, we realized that it was going to be tough to make that goal. We are pretty happy about being able to do a 10-day international trip for about $2,600. Like I mentioned earlier though, we are still learning, so we know we could do better than this! So if you know tips and tricks, please enlighten us all and let us know!

Here is our budget breakdown:

When it comes to budgeting, I usually try to overestimate slightly, because I’d rather be under the budget than over, and overestimating helps me to accomplish that. It’s hard to know, however, what all the costs will be exactly. Food and public transportation are hard to estimate, so we just tried to make our best guess. Most of the budget items for any vacation are very dependent upon what you actually want to do. If you are the type that loves to visit as many museums and sites as possible, your tourism costs may go up. If you are visiting as many cities as possible while in a foreign country (which we have done before), then your transportation costs will go up. So just make sure before you plan a trip that you know what you want to get out of it, and try to budget accordingly.

Ideas to Cut Costs of Your Trip

If you take a look at the summary, you will see that the two largest costs are transportation and AirBnBs. I would assume that for most travelers, this will be the case. Flights are by far the biggest part of our budget. This will bring us to our first travel tip: Find the right flights! You’ll either make or break your vacation budget on the flight. Our flights ended up costing slightly more than our budget, but only by about $20. But for us, being able to fly our wives, babies, and ourselves to Italy for under $830 was an accomplishment. Here are some ways we were able to do that:

Research, Research, Research

This part of traveling is probably a turn-off for most. Who likes to spend hours doing research? Well, in all honesty, I don’t mind research when it’s for vacationing! But I can understand why some may not enjoy this as much. It takes work to find the right flights and places to stay. As far as I know, there is no magic way of doing this quickly when you are seeking to cut costs. We used things like Google Flights or Momondo.com to help us find out what dates and airlines tend to be the cheapest. You can also try and google low-cost airlines to figure out which ones are not only the cheapest, but also offer the best routes to your desired destination. Spend some time researching. It may be long and difficult, but it can pay off big.

Pick The Right Airport

Flying out bigger hubs like LAX or JFK can save you a lot of money. It’s not always easy to get there though, and we understand that. But if you are able to drive to one of those airports or even find a cheap flight there, it can be easier to fly with low-cost airlines and save a lot of money. For our trip, we are flying out of Newark cause that is where we could find the cheapest flights to Rome with the airline we chose.

Time Your Vacation Right

We’ve learned that in general, it’s best to avoid June – August, as this tends to be high-travel season and flights and accommodations are generally more expensive. We are traveling in early May because that is when I’ll be out of school, and that is also when things were generally cheaper. Christmas time can also get more expensive, since a lot of people are traveling for the holidays. When you are doing research, it should become obvious pretty quickly which months are the cheapest, and which months you should avoid.

Take Advantage of Credit Card Rewards

A huge thanks here to our friends at wallstreetminimalist.com for helping us learn a little bit more about travel hacking. For those who aren’t familiar with travel hacking, it’s basically taking advantage of credit card reward systems to be able to travel really cheaply. Thanks to their tips, we were able to sign up for a credit card that was super easy to earn 60,000 miles with. We used those miles to get free round-trip tickets to NYC, where we were able to get pretty cheap flights to Rome. Had we just flown out of SLC, we probably would’ve spent much, much more on flights. If you don’t have much of a credit history, like my wife, then start working on that so you can qualify for things like this! If you and your spouse (for those who are married) are able to qualify for things like this, that can save you even more money than it saved us.

Pack Light

This can be tough, and we are interested to see how this goes with traveling with our baby, but if you can avoid checking bags, you can save hundreds of dollars. In fact, by choosing to do carryons only, I think we saved around $300. To make this work, it’s important to pick the right AirBnB or accommodations so that you can have some way of washing your clothes. This way, you can pack less. Packing less is nice for more than just the money though. The less you pack, the less you have to haul around going from city to city.

Looking Forward

Hopefully the nitty-gritty of the planning and budgeting didn’t bore you too much. If you are nerds like us, then you love this kind of stuff. I’m always trying to find ways to travel inexpensively and save money. I always wished that there were more comprehensive resources for finding the information on these kinds of things. It seems like I have to visit a 101 websites to find the right stuff. Hopefully we can help solve this problem as we continue to share our knowledge and experience with everybody!

So now we are about 7 weeks away from our trip. We have planned almost everything out, and most things are paid for. We are still finalizing a few trip details, but we will keep you posted on those for sure! Keep an eye out for our travel posts! We are excited to share more about the experiences when it actually happens, including tips for traveling with kids. Until then it’s the home stretch for me in school. I’ll be trying to focus on studying when all I can really think about is our trip to Italy!

The first time Casey and I ever budgeted was shortly after we got engaged and started planning our wedding. We had been discussing everything that we would need to do and buy to pull off what we had in mind, like the flowers, food, photographer, decor, my dress, and all of the million little things that go into a wedding! I still remember the night he showed up at my door with his laptop in hand and a Google Doc with all of these things written out, ready to start planning and setting our budget!

I was seriously impressed that he had even thought that much into all of this, was appreciative that he involved me in all of it and that it was a joint effort! This is all such a testament to his character because he’s just so considerate and kind like that. He’s the best and I just got so lucky, but really this was so very helpful in the whole planning process and made things run so much more smoothly!

I love that we started talking about money so early in our relationship and made budgeting together a habit right from the start! One of our budgeting tools that I think has helped us be most successful over the years is using an envelope system.

We are not the first people to utilize this method and it is nothing that crazy or new, but I think there is definitely a reason it is so wildly popular! Envelope systems are meant to help you visualize and stick to your budget by using designated, physical envelopes with cash set aside for each category.

How we use the envelope system

We have an envelope for each of our budget categories, but we do not pull out cash for every single one of them. For example, our insurance is on auto-pay directly from our bank account, so it wouldn’t make sense for us to pull out that physical money. For categories like this we simply write out and account for the amount that was spent, that way we have a record and can keep track.

Categories like gas, groceries, and eating out make good sense to use cash! At the beginning of the month we pull out our allocated amount and put it in the designated envelope. When I go buy groceries, I use the money in the envelope and nothing else. This requires planning and discipline because once that money is gone I obviously can’t spend what I don’t have. I write down the date and how much I spent so that I can better track my spending and know how much is left. This has really helped us have control over our money, avoid overspending, and be more intentional about purchases.

One of the great things about the envelope system is that you can customize it to work best for you. For example, when you want to fill your envelopes with cash. We get paid monthly on the last day of the month, so it works well for us to get cash on the last day in preparation for the new month, but you could do it weekly, bi-monthly or whatever is most efficient for you. You can also use plain white envelopes, colorful ones, or whatever you prefer that will help you to organize them.

As we said earlier, you have to be disciplined. You are the only one who can make yourself stick to a budget and create success. Budgeting can be a challenge, but the more you utilize it and let it become habit the easier it becomes! This isn’t to say that you will be perfect, especially when you are just starting out. We have gone through periods where we were really diligent and good about planning our budget and using the cash from our envelopes, and there have been times where we’ve gotten lazy and turned to swiping our debit cards.

There is a surprisingly big difference in our spending and we have learned through experience that we do so much better when we use our envelopes! It has helped us recognize our spending habits and address issues and weaknesses, which in turn saves us even more money!

We know that this method works and would love to hear from you if it is something that you already use or if you decide to go try it out if you aren’t already!

There has been a lot of buzz and discussion around budgets over the past few years, which I LOVE because I know first-hand just how important they are! Some of this buzz is positive, from people like me who want others to take part and reap the benefits! But much of it seems to be negative from people who either can’t seem to stick to it, see it as keeping them from enjoying life, or don’t know where to begin! Living by a budget takes discipline, which I know sounds strict and intimidating, but this is FAR from the truth, especially if you follow my quick and easy tips for how to successfully budget and actually stick to it!

Start your budgeting session by thinking about your goals. These should be specific so you know what you’re truly wanting to accomplish. You also want these to be realistic and attainable, which will be the first step in setting yourself up for success. Think about why you want to budget- do you want to have money in savings? Live beneath your means so you stop living paycheck to paycheck? Be able to take vacations? There can be lots of reasons, but I advise that you write these down and use them as motivation and a reminder that YOU WANT THIS!

Now that you have set your goals, write down your income. This is going to be the number you will base your whole budget around, so it is important to account any and all income here! If you have a variable income where the amount of money you’re taking in every month changes, take an average of the past three to six months and use that as your “income” number. It is best to be realistic about this number and would be better to underestimate rather than overestimate if you are not sure. You need to be very clear about your current financial status and what you have to work with.

Now that you know just how much money you have to work with, make a list of expenses you have every month. You need to get very specific with this. Some categories might include groceries, rent or mortgage, utilities, home and car insurance, gas, debts or loans, etc. You should use your bank statement to help you identify some of these categories and also help recognize where your money is going. Once you have these written they can be sub-categorized into NEEDS (fixed expenses), WANTS (variable expenses) and SAVINGS (wants for the future).

With your categories written out, fill in your set expenses. For example, if the rent on your apartment is $1100 per month, you can write that in your RENT category. With that written down you can subtract $1100 from your income total. You will continue to do this with all of your fixed expenses, subtracting the numbers and recording them as you go.

Once those have all been recorded you will want to move onto your variable expenses. Let’s say after you’ve accounted for all of your fixed expenses you are left with $1550. You now want to address which of your variable expenses are most important to you. These might include things like groceries, eating out, clothes, entertainment, and savings. Groceries might be more important to you than going to a movie, so groceries would be higher up on your priority list. By looking at your  remaining categories you can kind of give an idea as to how you  want to divvy this money up. Since groceries seem to be a struggle for most people, my recommendation for groceries is $100 per person in your family per month on groceries. This can change if you live alone or there are only two of you at home, then I advise between $125 and $150 per person. You can save so much money by planning your meals and cooking/ eating at home. You can divvy your remaining money up however you would like between your remaining categories, but once the money is gone it is GONE. Be wise with what how you delegate your money! If you find that you don’t have enough money to cover each of your categories, go back and re-prioritize. If you have the opposite problem and have money left over, I advise putting this extra money towards debt! If you do not have debts, I advise putting things towards savings, but it can be put in whichever category you feel is a priority.

The beauty of a budget is that it can change month to month in your “variables” so you can make it work for you and what you want to accomplish. A budget allows you to control your money and not let your money control you. 

Here is a good Budget-Template. Feel free to download and use for your own budgeting needs! If that template doesn’t work for you, you can always get another one here