new goals

As promised in my last post, here are a few financial goals that I would like to meet in the near future. My end goal is that by posting these aspirations on the internet, it will make me more accountable for them and I will work hard so that I can post more successes than failures!

Goals:

#1 – I want to start brown-bagging more lunches. This is something that I can do well on for awhile, then I will fall off the wagon. Two years ago, almost all of the meals that I ate at work were either fast-food or something that I picked up in the store – and they were rarely healthy choices. It usually amounted in a meal full of calories, fat, and sodium and almost zero whole grains, fruits, veggies, and non-processed foods. As I started to worry about the impact this habit had on my health and my wallet, I started to brown-bag more often. There was even a period of time where I brought my own lunch everyday! Unfortunately, at this moment, I am still buying lunch 1 or 2 times a week during the workweek. Ultimately, I wouuld like to bring this number down to 0, unless there is a special occaision. I am going to do it in increments – try to get down to once a week, then once every other week, then (hopefully) none, barring special occaisions (company lunches or a planned lunch with a family member or friend).

#2 – Pay for my Iceland trip in all cash. This doesn’t mean that I won’t use my credit card at all. I actually plan on using my credit card a fair bit because of the additional protections that a credit card has over a debit card. In fact, I have already used my credit card several times to book accomodations and such. What I mean by paying all in cash is that I don’t want to go into debt over this trip. I feel fairly confident that once I return, I won’t have any debt from my trip. However, in order to make that happen, I am going to have to be careful on how I spend my momey in the next few months. I leave in 17 weeks – 119 days or approximately 4 months. I have estimated my expenses, and saved accordingly. I am close enough to that goal that I think I will make it by the end of July – but only if I am careful about my spending. This could be a challenge, for reasons that I will discuss a little later.

#3 – Live below my means – even though raises are coming! At the income level I am at right now, I am able to pay my bills, throw some money into savings and still have a little bit leftover at the end of the month. Starting April 1st, I will receive a raise from my primary job, and on May 17th, I will receive a raise from my second job. Although neither raise has doubled my salary or given me delusions of grandeur, I know that at least one of them is very decent and would allow me to have more discretionary income. My goal is to NOT let this happen. I really want to keep my expenses at the same level, and put the increase in pay right into the bank. Although it would be nice to have more splurges, I really want to beef up my savings first and foremost.

Challenges:
I mentioned earlier that I have a few challenges to face ahead of me. The first, and biggest challenge is that I am in the process of trying to buy my first home. I am really excited about it and I am sure I will have more to say on the subject at a later time. However, there are a lot of unknowns that come with buying a house, as well as fees associated with it (home inspections, termite inspections, earnest money, closing costs, downpayments – oh my!). Plus, there will be more costs once I move in – likely an appliance or two, plus fees like connecting the utilites and getting my internet service moved over. I have put offers on two houses so far. The first offer was turned down, and the second offer is pending. I am pretty unsure of what will happen, but I know that I want to be in a house soon and I am going to be facing some costs to do it. Plus, I will have to take a little time off work to sign papers and move. It can be a challenge. Second, I am seriously considering dropping my second job when the summer is over and committing to more time at my primary job while still teaching dance one night a week. As far as income, it would be about the same (since I am earning significantly more at my primary job than my second job as a lowly barista). By dropping the second job, I would have a lot more free time to pursue other interests (such as this blog!). That could be a big positive or a big negative. My decision hasn’t been made yet, but I feel like it will be in the near future, and this will also impact my finances. The third challenge is that I want to start taking more time a year to travel. Although I currently get some paid vacation time, once that runs out I am out of luck and if I want to take time off, it has to be unpaid. This is problematic, not just because travel is expensive, but after a short amount of time, I am also not able to generate money while I’m away. I’m currently doing research on how to tackle this challenge, because I know thousands of people overcome it every year. Fourth, I am trying to get in better physical shape. It’s not just about losing a ton of weight (although I wouldn’t turn that down!) but I want to feel more fit and have the peace of mind that I am showing my body respect, by maintaining it inside AND out. Not only are there costs associated with that (gym membership, , Weigh Watchers membership {intro special for 3 months. After 3 months I may not be interested in the program anymore} buying healthier, more perishable foods), but in the event that I do lose substantial weight, I will have to start getting new clothes. This would be an AWESOME challenge to have, but it is one that is on my horizon right now.

There. I said it. It’s all out in the open. Look for an update at the end of April to talk about how I have done!

accountability

At one of my past jobs, one of the big pushes that management made toward the employees was accountability. They always encouraged us not to blame others for shortcomings and make the work environment feel petty. Instead, we were told to be introspective and ask what we could have done to make the situation different.

Sometimes, this principle is annoying. If it was another person’s fault, why should I feel responsible for it? However, taking personal responsibility for my actions in the work force rubbed off in my personal life. I now try to apply this principle when I can in my day-to-day dealings with others. True, sometimes it is their fault. More often than not, though, my actions play a part in why the situation went the way it did. This introspection forces me to do some reflecting on how I handle things, and it has been a great tool for me in the realm of personal finance.

Once I decided that I wanted to be more aware of where I was spending my money, I realized that I needed to analyze my habits before I could make any changes. What sort of money mistakes was I making? I thought I was doing okay with my finances, but I had to be really introspective and honest with myself to acknowledge the areas that I performed poorly (namely, entertainment costs). Then, the challenge became holding myself accountable when I did make those mistakes. If I went over my budget in one area, I forced myself to analyze why. Did I not budget enough in the beginning? Was that truly an adequate amount? Did I make poor decisions that made me go over my budget? Was it a emergency or something unavoidable, or was it something that I had convinced myself was an emergency?

Holding yourself accountable shouldn’t be about shaming yourself when you make terrible decisions (at least, that’s not all of it!). Instead, it should make you start looking into your motives behind your actions, and by addressing the reasons why you act/spend/do the things you do, it can give you insight on how you need to change.

Another reason for accountablity: most people want to share their successes with the world. Accountability, if used properly, also makes you share some of your shortcomings and failures. By putting this out into the world, you will most likely try to hold yourself accountable more often – after all, there’s someone out there who knows that you failed. Wouldn’t it be nice to tell them that you succeeded?

That being said, I am going to try to take my level of self-responsibility to a higher level. My next post is going to cover some financial goals that I have set for myself. Periodically, I will check in and update on those goals, whether it be good, bad, or ugly. I hope that this level of transparency makes a positive impact on me reaching my goals, but I am also fine with having a way to vent and ponder why I failed.

Have any readers decided to up their level of personal responsibility, or become more aware of it? Share your experience in the comments!

mindless ways to save

For a lot of people, finding ways to contribute to your savings account makes you feel like you are depriving yourself. I know that I have felt that way in the past, especially if I had to save a large amount in a short period of time. For instance, I only had about 4 months to plan and fund my trip to Ireland last year. It’s true that I had already saved some money for my next big trip, but it wasn’t enough and I needed to save aggressively if I wanted to take this vacation debt-free. What that meant in reality is that I cut WAY back on everything in order to meet my goal – and yes, at times, I felt deprived.

Thankfully, all saving is not like that. There are ways to save that I consider mindless – so easy that I don’t even have to think about doing it, and it still works. These three savings hacks are ways that I have found to squeeze money from my budget mindlessly (they are also good tips if you are very strapped for cash, but would like to begin the process of saving).

1. Round up in your check registry.

This is simple to do, but requires you to be somewhat organized. It also requires you to have a physical check registry, which is becoming increasingly less common.

In my check registry, any time that I have a withdrawal or debit, I round up to the nearest dollar number, while noting the true amount off to the side. About once every two months, I go through and add up the difference between the true total and what I wrote down, add the total up, and transfer this amount to savings.

For instance: Say that I use my debit card at the grocery store for a purchase that totals $14.57. In my check registry, I would note a debit of $15.00. However, off to the side, in parentheses so I don’t get confused, I have the actual total, $14.57. When I sit down and total up my registry, I subtract the $14.57 from the $15.00 to get $0.43. If you use your debit card with any regularity, this method builds up change quickly. Every two months, I usually have between $20 and $30 to add to my savings, sometimes more if I have been swiping a lot that month. The price difference is so small that it doesn’t impact my cash flow too much, and I can easily save that cash. I know of one person who rounds up to the next $5 mark (so a $2.68 purchase would get rounded to $5.00), but that method is a little more confusing and takes a larger toll on your cashflow. That might be too much for someone who is on a strict budget.

Another added benefit of the rounding is it makes it easier for me to quickly balance my check book and know exactly where I stand financially in my checking account. The small cushion that the change provides me is there in case I have budgeted too hard and have very little cash left, thus helping to prevent overdraft fees. Not everyone likes to be burdened with a check registry, but a small note book or note-taking phone app works just as well.  You can always check yourself against online statements if you have forgotten to enter a transaction (just be aware that it can take several days for a transaction to process – so if you swipe your card a lot, your online statement is not going to be entirely accurate).

2. Save all your coins.

I don’t pay with cash regularly. Something about having physical cash in my hands makes me want to spend it on frivolous things. However, when I do have cash, I never pay in exact change. Instead, I save it all. Sure, it’s only a few cents at a time, but it adds up. One year I was able to pay for a plane ticket to Russia with my change! I have also tried different methods in the past. Sometimes, I would save all of my fives. Other times, I would save ones that had certain serial numbers. Make it into a game, and you will enjoy saving it more!

3. Set up a small, automated savings withdrawal.

Online banking is rampant, and transferring money between accounts has never been easier. Start with something small and manageable. $5 a week is a good start, but even a $1 a week is better than nothing. You may also want to pick the age of your child as a number, or perhaps the year you are going to graduate college ($20.14?). By automating your savings, you don’t have to think about it as much, and it becomes easier and easier to let it build in a savings account. One tip, however, is don’t forget to account for it in your budgeting. Otherwise, you may incur an overdraft fee, which will more than likely wipe out any savings you may have had!

These are a few of my favorite mindless ways to save, do you have any?