Prior to the last two weeks I was keeping one credit card on me "just in case of an emergency." Between June and early July, I put $1,000 onto that sucker. That does not include a $200 plane ticket for a planned vacation.
Needless to say after overspending that much, I had to make the bleeding stop. I have hung the card up to dry in some drawer at my parents house, where it can stay safe and sound and far far away from my budget.
During the last two weeks, I have not adjusted well to not spending at my leisure like I had been doing on the Amex. I blew my dining out / grocery budget by $50 already, and I still have 4 days to payday. Part of this is to blame on the longer days to spread the check over - we were paid the 13th, the next one still won't come until the 31st - so 17 days rather than 15, which happens to include an extra weekend.
But excuses are for addicts - I must get past the denial and accept the fact that I blew it. So I have started looking for a solution. One point of major bleeding I found is lunch & drinks. Almost all of my "dining out" was spent on one of these two. Overall, I spent an average of $15 a day on dining out, and $20 on food in general.
For this next week, I have a few challenges for myself to achieve an overall goal of $5/day average for dining out and $7/day for eating in: 1. Eat breakfast in, every day. 2. Only eat out for lunch 1 weekday and 1 weekend day. 3. Dinner - same rules as lunch.
Let the games begin!
Friday, July 27, 2012
Sunday, May 13, 2012
The Finish Line
Many of the books I have read lately emphasize the important of VISUALIZATION in achieving a goal. You start with the furthest out goal (by a house) and work your way backwards to current day decisions that can be made to achieve that goal.
Example: One day I would like to own a house. (Overarching goal). Before I take out a mortgage, I should pay off my student loans (long-term). I can pay off more of my student loans once I get rid of credit-card debt (short-term).
Once you have your end result in mind (relaxing on the back deck off my kitchen with my morning paper and a cup of coffee, while I listen to the birds in my back yard), the day-to-day steps become more clear and more important to achieve.
Credit can help your or hurt you along the way. The less debt the better, but there are some basics of having a good credit score and affordable interest rates- pay any bills on time, always make your minimum payment, etc. Rather, if you don't do these things, your credit score will take a big hit down, and once your credit score goes down your interest rates go up and suddenly you owe a lot more than the $15 minimum payment you missed....
Keeping a good credit score is a good overarching goal to your financial decisions. The hardest part will be creating a lifestyle for yourself where you stay within your limits and create some cushion. Staying within your limits means spending less than you make each month. If you spend less than your monthly income, you won't need credit cards. If you don't need credit cards, you won't throw away money on interest payments. And the benefits just keep coming..
The second part, cushion, entails not just staying right within what you make every month, but actually being disciplined enough to set some aside. Start small - the emergency fund I talked about before (~$1,000) should be created as soon as possible and used only for true emergencies (and if used at all, built back ASAP).
Next, work towards saving 4 - 6 months worth of expenses - this way if you are injured, the economy crashed, or your new CEO does a lot of layoffs, you have enough backup to keep paying your bills, work on your recovery, and get to that next job and back on your feet.
Once you have an emergency fund, start thinking big! What would I like to have for myself one day? A beach getaway? A different car? Your own house? A cozy retirement? If you dream it, visualize it, and plan the steps to get there, you can achieve just about anything. Seriously.
What do you want your finish line to look like?
Example: One day I would like to own a house. (Overarching goal). Before I take out a mortgage, I should pay off my student loans (long-term). I can pay off more of my student loans once I get rid of credit-card debt (short-term).
Once you have your end result in mind (relaxing on the back deck off my kitchen with my morning paper and a cup of coffee, while I listen to the birds in my back yard), the day-to-day steps become more clear and more important to achieve.
Credit can help your or hurt you along the way. The less debt the better, but there are some basics of having a good credit score and affordable interest rates- pay any bills on time, always make your minimum payment, etc. Rather, if you don't do these things, your credit score will take a big hit down, and once your credit score goes down your interest rates go up and suddenly you owe a lot more than the $15 minimum payment you missed....
Keeping a good credit score is a good overarching goal to your financial decisions. The hardest part will be creating a lifestyle for yourself where you stay within your limits and create some cushion. Staying within your limits means spending less than you make each month. If you spend less than your monthly income, you won't need credit cards. If you don't need credit cards, you won't throw away money on interest payments. And the benefits just keep coming..
The second part, cushion, entails not just staying right within what you make every month, but actually being disciplined enough to set some aside. Start small - the emergency fund I talked about before (~$1,000) should be created as soon as possible and used only for true emergencies (and if used at all, built back ASAP).
Next, work towards saving 4 - 6 months worth of expenses - this way if you are injured, the economy crashed, or your new CEO does a lot of layoffs, you have enough backup to keep paying your bills, work on your recovery, and get to that next job and back on your feet.
Once you have an emergency fund, start thinking big! What would I like to have for myself one day? A beach getaway? A different car? Your own house? A cozy retirement? If you dream it, visualize it, and plan the steps to get there, you can achieve just about anything. Seriously.
What do you want your finish line to look like?
Monday, April 23, 2012
What's the problem with credit, anyhow?
I'd like to start this session with a little personal story. Two months ago the sit up sheets went around for girl scout cookies. Being the awesome friend and daughter that I am, I decided to order two more than usual to give to my friend and my mom. So arrival day came and here I sat, with FOUR boxes of cookies. Quick outside lesson about myself 1. I'm not big on sweets in the sense they are not a daily or even weekly purchase for me. 2. I work a job with unpredictably long nights. Just so happens the day of the arrival of the deliciousness, work turned into one of those late nights. Guess how many of that first box survived the night? Less than half.
Now, knowing what you know about my lack of sweet tooth, what do you suppose was the cause of my cookie binge? Aside from stress (not uncommon and manageable by alternating dubstep and classical music) I had an endless supply of cookies. Why did I eat them rather than order salad with everyone else? Simple: because they were there!
Similar to the grass is greener on the other side syndrome, the minute your credit card tells you that you have $3000 to spend, you feel you have $3000-cash. Deep down, when you are debating between debit or credit you think "credit. I have more"
MEEEH!! Wrong sucker! You just offered to pay a company more than you're worth in repayment and interest for sh** you probably don't need in the first place. My net worth currently sits at negative few thousand (which has come down tremendously thanks to savings and paying down my student loans).
The fact I owe more than I am worth is something I am not fond nor proud of, but I at least happy to say I got an education worth more than I owe for it, so I'm not too worried about future.
Today amidst various political BS I heard the statement "Americans now owe more in student loans than credit card debt." And you idiots think that's a BAD thing? So I spent more on my education than my wardrobe or the car I might wreck after charging the nonfat latte I managed to spill in my lap - at least knowledge and social skills friendships business connections might get me a better job one day. Visa, Amex, MasterCard, and Discove will not.
If you have it ($3000 credit line) you will spend it, or more than you otherwise would. You'll think "that Chamanda is crazy, this isn't do bad!" and more cards you shall get..
A glass of milk goes nicely with cookies, but eventually the box and your friend's box and your mom's box will be gone, and the girl scouts have stopped selling and you are left with spoiled milk and no cookies.
Same to your wallet and your credit. Don't let your credit score become a half empty glass of spoiled milk. It smells bad, and it's hard to be friends with smelly people...
Now, knowing what you know about my lack of sweet tooth, what do you suppose was the cause of my cookie binge? Aside from stress (not uncommon and manageable by alternating dubstep and classical music) I had an endless supply of cookies. Why did I eat them rather than order salad with everyone else? Simple: because they were there!
Similar to the grass is greener on the other side syndrome, the minute your credit card tells you that you have $3000 to spend, you feel you have $3000-cash. Deep down, when you are debating between debit or credit you think "credit. I have more"
MEEEH!! Wrong sucker! You just offered to pay a company more than you're worth in repayment and interest for sh** you probably don't need in the first place. My net worth currently sits at negative few thousand (which has come down tremendously thanks to savings and paying down my student loans).
The fact I owe more than I am worth is something I am not fond nor proud of, but I at least happy to say I got an education worth more than I owe for it, so I'm not too worried about future.
Today amidst various political BS I heard the statement "Americans now owe more in student loans than credit card debt." And you idiots think that's a BAD thing? So I spent more on my education than my wardrobe or the car I might wreck after charging the nonfat latte I managed to spill in my lap - at least knowledge and social skills friendships business connections might get me a better job one day. Visa, Amex, MasterCard, and Discove will not.
If you have it ($3000 credit line) you will spend it, or more than you otherwise would. You'll think "that Chamanda is crazy, this isn't do bad!" and more cards you shall get..
A glass of milk goes nicely with cookies, but eventually the box and your friend's box and your mom's box will be gone, and the girl scouts have stopped selling and you are left with spoiled milk and no cookies.
Same to your wallet and your credit. Don't let your credit score become a half empty glass of spoiled milk. It smells bad, and it's hard to be friends with smelly people...
Thursday, April 12, 2012
Budget Commandments
Lately I have been a little off... budget-wise, blog-wise, fitness-wise, you name it, it's off. But, lately I have been focusing on something a little bit different. Just recently I took a vacation and despite the word "vacation" and very much wanting to be happy and content, I noticed that not only was I neither happy nor content (despite giving myself an extra spending allowance to enjoy), but I was also brining down the entire mood around me. The Lorax inside me speaking for happiness everywhere struck out - something must be done.
Inspired, while perusing the book selection at the airport, a title struck out at me: The Happines Project @ http://www.happiness-project.com/. Gretchen has 12 Personal Commandenments inspired by various moments of her life and happiness project, which led me to think, why not have 12 Spending Commandments? A quick list of reminders is just what I need to get my budget back on track.
1. Pay debt first
2. Every penny counts
3. Debt, Save, Give, Needs, Fun
4. Flex and be flexed
5. Hard work pays off.
6. Plan the splurge.
7. Needs > wants.
8. Give more.
9. Have a little faith.
10. Fun is free.
11. Home cooked > dining out
12. Credit = debt = bad idea.
- "my" money is not mine until I give back what I borrowed.
-if I budget to $0 including-"miscellanous" not a penny is wasted.
- in order from most to least important
- wiggle room is good, like expecting the unexpected so Im always prepared
- grades, budget,career, family.. you name it, and this is true.
- if I plan the splurge I can get the most bang for my buck - outlet mall on a holiday wekeend anyone??
- are my .. bills paids, car running, body working?
- I have been blessed because others gave to me, time to return the favor
- If I spend wisely and plan ahead, I know my needs will be met
-going outside, talking with friends, using my imagination -so much fun for $0!
- less on my waist more in my wallet, what's not to love?
- the temptation to spend when the credit is in my wallet is far greater than the discount coupons I get. I need to lock them up and throw away the key, lest I make the unplanned splurge.
Inspired, while perusing the book selection at the airport, a title struck out at me: The Happines Project @ http://www.happiness-project.com/. Gretchen has 12 Personal Commandenments inspired by various moments of her life and happiness project, which led me to think, why not have 12 Spending Commandments? A quick list of reminders is just what I need to get my budget back on track.
1. Pay debt first
2. Every penny counts
3. Debt, Save, Give, Needs, Fun
4. Flex and be flexed
5. Hard work pays off.
6. Plan the splurge.
7. Needs > wants.
8. Give more.
9. Have a little faith.
10. Fun is free.
11. Home cooked > dining out
12. Credit = debt = bad idea.
- "my" money is not mine until I give back what I borrowed.
-if I budget to $0 including-"miscellanous" not a penny is wasted.
- in order from most to least important
- wiggle room is good, like expecting the unexpected so Im always prepared
- grades, budget,career, family.. you name it, and this is true.
- if I plan the splurge I can get the most bang for my buck - outlet mall on a holiday wekeend anyone??
- are my .. bills paids, car running, body working?
- I have been blessed because others gave to me, time to return the favor
- If I spend wisely and plan ahead, I know my needs will be met
-going outside, talking with friends, using my imagination -so much fun for $0!
- less on my waist more in my wallet, what's not to love?
- the temptation to spend when the credit is in my wallet is far greater than the discount coupons I get. I need to lock them up and throw away the key, lest I make the unplanned splurge.
Monday, March 12, 2012
How to Make the "Oh Sh!!" Purchase, without need to say "O.S!!"
As you may have noticed in my last blog, I recently had an O.S moment. Drove to work like usual, parked my car in the deck like usual, went on with my day like usual, left way later than I would like to like usual, and my car had a flat tire.
Old me: "O.S.!! I have a flat tire how am I going to pay to get a new one?"
Budget-savvy diva-self: "I have a flat tire, but damn I'm hungry.. what to do..what to do"
As you saw, I called AAA and had them put that beautiful donut in place of my decrepit pitiful looking tire.
The following week I went to my favorite Kauffman Tire and asked what they recommended, so 4-tires and an alignment later, Betsy (as I fondly call my 1999 Camry) and I rolled on out of there safe and happy - all for a whopping $425.
Ok, so I got a good deal on those 4 new tires and alignment - but $425 is practically rent. The man at the counter even said "well I am not sure if this is in your budget or not.."
I thought to myself, "Well no sir, I did not write in 'unexpected new tire purchase' when I made my February budget." But I did think - "Well, I have almost 4 months worth of expenses saved up - and I can start replenshing that bucket as soon as next paycheck, so I should go ahead and take this good deal and put that nasty donut back in the trunk where it belongs."
Here's the how:
Step 1 - Make a budget, include Step 2 as a major goal of your budget.
Step 2 - Save $1000 as quickly as possible - this is yours to keep, not spend.
Step 3 - If you have real emergencies along the way, use your part of your $1000, and pay back in until back to $1000.
Step 4 - Pay off credit card debt - this is money you spent that you did not have. The money you make is not truly yours until your debt is gone, period - be careful.
Step 5 - Take your main monthly expenses (utilities, food, enough for gas to get to work) and multiply by 3 if you are single no kids, 6 if you are married/have kids. This is your emergency fund goal.
For some, this may be a very quick process - tax refund anyone??
For others, this could take quite some time. But true me - it's worth it!!
You may feel trapped by your budget to start - eating out less, shopping less, etc. - but once that "Oh sh!!" purchase comes and you find yourself not worried about how to pay for it, you will get to breathe the most satisfying sigh of relief you have felt in a long time.
Old me: "O.S.!! I have a flat tire how am I going to pay to get a new one?"
Budget-savvy diva-self: "I have a flat tire, but damn I'm hungry.. what to do..what to do"
As you saw, I called AAA and had them put that beautiful donut in place of my decrepit pitiful looking tire.
The following week I went to my favorite Kauffman Tire and asked what they recommended, so 4-tires and an alignment later, Betsy (as I fondly call my 1999 Camry) and I rolled on out of there safe and happy - all for a whopping $425.
Ok, so I got a good deal on those 4 new tires and alignment - but $425 is practically rent. The man at the counter even said "well I am not sure if this is in your budget or not.."
I thought to myself, "Well no sir, I did not write in 'unexpected new tire purchase' when I made my February budget." But I did think - "Well, I have almost 4 months worth of expenses saved up - and I can start replenshing that bucket as soon as next paycheck, so I should go ahead and take this good deal and put that nasty donut back in the trunk where it belongs."
Here's the how:
Step 1 - Make a budget, include Step 2 as a major goal of your budget.
Step 2 - Save $1000 as quickly as possible - this is yours to keep, not spend.
Step 3 - If you have real emergencies along the way, use your part of your $1000, and pay back in until back to $1000.
Step 4 - Pay off credit card debt - this is money you spent that you did not have. The money you make is not truly yours until your debt is gone, period - be careful.
Step 5 - Take your main monthly expenses (utilities, food, enough for gas to get to work) and multiply by 3 if you are single no kids, 6 if you are married/have kids. This is your emergency fund goal.
For some, this may be a very quick process - tax refund anyone??
For others, this could take quite some time. But true me - it's worth it!!
You may feel trapped by your budget to start - eating out less, shopping less, etc. - but once that "Oh sh!!" purchase comes and you find yourself not worried about how to pay for it, you will get to breathe the most satisfying sigh of relief you have felt in a long time.
Sunday, February 26, 2012
Confessions of a Budget Blower
This pay period I did pretty well in most of my budget categories. Utilities were $50 cheaper than usual, so I put that into my long-term savings. Actual grocery expenditure was only $60 of the $100 I originally allotted. Dry cleaning was $14 of the $25 I set aside. Spending on gas was about half of what I allotted. And I gave up all alcohol for lent (lots of reasons behind that one, tougher than sticking to a budget!!!), so naturally my dining out spending will likely be half of what it usually would.
But here's where the trouble begins..
Mom's birthday was Wednesday. Tuesday night I decided to take the 45 minute drive ( 20, since I was already halfway there for work) to see her - but she was not home, so I bought her flowers & chocolate (real gift was at my apartment still), and left the card I had planned to mail with the gifts. Extra gas used - no mother to see.
Wednesday night I came out of the office to a flat tire. Tipped the AAA guy $5 that I wasnt expecting to spend.
Thursday I got off work early, so I drove back home (again) and took Mom to dinner. Extra $30 from my dining out budget I did not anticipate, but the food and the company were amazing, so I count it as worth it!
Friday had a chiro appointment - usually I only have one a month, this is the 2nd in two weeks. Good bye $50.
And Saturday boredom and a failed attempt to get my flat tire fixed (wait so long I probably wouldnt have made it by the time they closed) let to shopping trip at the nearby mall. EVERYTHING was on sale. In particular, a shirt I have had my eye on since January was on clearance + extra 30% off. I broke my own rules and did not put the shirt on hold, and picked a second up in the process.
So while I have enough cash to pay the *wince* credit cards that I put the chiro, shirts, and birthday dinner on (rule #3 broken), I will either a) cut back next month's free spending & pay with the next check b) not give to charity.
I dont think I should compromise on b), so please understand if I turn down a few extra lunch dates.
Total $$ blown: $12 gas, $15 flowers, card, chocolate, $5 tip to AAA, $30 dinner out, $50 chiropractor, $43 shopping spree = $155.
Not the worst I've ever done, but as I budget down to the last penny, that is $155 that I don't get to spend next month :(.
But here's where the trouble begins..
Mom's birthday was Wednesday. Tuesday night I decided to take the 45 minute drive ( 20, since I was already halfway there for work) to see her - but she was not home, so I bought her flowers & chocolate (real gift was at my apartment still), and left the card I had planned to mail with the gifts. Extra gas used - no mother to see.
Wednesday night I came out of the office to a flat tire. Tipped the AAA guy $5 that I wasnt expecting to spend.
Thursday I got off work early, so I drove back home (again) and took Mom to dinner. Extra $30 from my dining out budget I did not anticipate, but the food and the company were amazing, so I count it as worth it!
Friday had a chiro appointment - usually I only have one a month, this is the 2nd in two weeks. Good bye $50.
And Saturday boredom and a failed attempt to get my flat tire fixed (wait so long I probably wouldnt have made it by the time they closed) let to shopping trip at the nearby mall. EVERYTHING was on sale. In particular, a shirt I have had my eye on since January was on clearance + extra 30% off. I broke my own rules and did not put the shirt on hold, and picked a second up in the process.
So while I have enough cash to pay the *wince* credit cards that I put the chiro, shirts, and birthday dinner on (rule #3 broken), I will either a) cut back next month's free spending & pay with the next check b) not give to charity.
I dont think I should compromise on b), so please understand if I turn down a few extra lunch dates.
Total $$ blown: $12 gas, $15 flowers, card, chocolate, $5 tip to AAA, $30 dinner out, $50 chiropractor, $43 shopping spree = $155.
Not the worst I've ever done, but as I budget down to the last penny, that is $155 that I don't get to spend next month :(.
Friday, February 10, 2012
Budget - the Work/Life Bridge
http://moneyland.time.com/2012/02/03/personnel-finance-productivity-down-employers-target-debt-stress/
This article presents an intersting viewpoint: employers have incentive to teach employees about personal finance.
What I found even more interesting, however, was this tidbit "There are ideological blocks too: many think school is for Shakespeare and Nietzsche and that teaching kids about money is best left to parents."
When I compare the classes I had in highschool to what my mother had in highschool, I noticed something interesting: classes teaching skills useful to an individual operating their basic every day life, such as cooking, nutrition, and personal finance, have nearly vanished from public schools.
What are a vast majority of American's problems stemming from these days? OBESITY AND DEBT!!
No wonder the private sector has begun to hone in on this lack of information - organizations like http://www.fitbit.com/ and http://www.myfitnesspal.com/ are easy, nifty tools to help people set exercise and nutrition goals, and keep track of their progress.
Similarly, programs such as http://www.mint.com/ and celebrity-like figures such as Dave Ramsey and Clark Howard have popped up trying to help people learn how to manage their money and reach their financial (as well as other) life goals.
Accordingly, employers can benefit tremendously and quite selfishly from helping employees conquer their own health or finance issues. Who would you want on your staff? The unhealthy, broke employee who continually calls out sick or is late due to car troubles that she cannot afford be fixed (unreliable), or the healthy, financially stable individual (reliable)?
Could your organization benefit from implementing Financial Success program?
This article presents an intersting viewpoint: employers have incentive to teach employees about personal finance.
What I found even more interesting, however, was this tidbit "There are ideological blocks too: many think school is for Shakespeare and Nietzsche and that teaching kids about money is best left to parents."
When I compare the classes I had in highschool to what my mother had in highschool, I noticed something interesting: classes teaching skills useful to an individual operating their basic every day life, such as cooking, nutrition, and personal finance, have nearly vanished from public schools.
What are a vast majority of American's problems stemming from these days? OBESITY AND DEBT!!
No wonder the private sector has begun to hone in on this lack of information - organizations like http://www.fitbit.com/ and http://www.myfitnesspal.com/ are easy, nifty tools to help people set exercise and nutrition goals, and keep track of their progress.
Similarly, programs such as http://www.mint.com/ and celebrity-like figures such as Dave Ramsey and Clark Howard have popped up trying to help people learn how to manage their money and reach their financial (as well as other) life goals.
Accordingly, employers can benefit tremendously and quite selfishly from helping employees conquer their own health or finance issues. Who would you want on your staff? The unhealthy, broke employee who continually calls out sick or is late due to car troubles that she cannot afford be fixed (unreliable), or the healthy, financially stable individual (reliable)?
Could your organization benefit from implementing Financial Success program?
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