It’s been so long since my last blog. I’ll do a quick re-cap of the past 7 (eep!) months. Graduate school (boo), Thanksgiving (yay!), move to Chicago (super woohoo!), unemployment (meh), job search (whaaat???), new job (yay!), and finished thesis (super yay!).
Now that I’ve filled you in we can get down to business. Recently, I decided to get in control – well perhaps control is too strong a word…. I suppose I’ll use the word “informed” about my personal finances. Obviously, being unemployed on a strict budget was difficult and required really understanding where each penny went. It’s easy to remember the big stuff – like the energy bill or the new mattress I had to buy when I moved. It’s not always so easy to see the $2 soda I “had to have” from Walgreens, or the Amazon Instant episode of Downton Abbey Season 3 I “need to see or I’d die” and I’ve found those little purchases are the ones that eat away at my savings, my budget, and my ‘control.’
My obsession with over-spending while unemployed really began when I read this book:
I’ve tried budgeting ‘old school’ with a generic list of expenses and a calculator, I’ve used excel personal budget spreadsheets, apps, finance journals, etc. and nothing seems to be ‘up-to-date’ or a true reflection of my finances. I decided to have a lassiez-faire approach to my calculated budget and instead follow some of the author’s advice. I really connected with Jeff Yeager’s message – live comfortably within your means. Find a point of comfort and settle in there. Don’t grow with your income so that everything coming in is going right back out. This might sound like ‘common sense’ to most, but one look at the amount of people who are in debt and struggling or are ‘house-poor’ and I know it’s advice that is not really getting through to folks. This book also suggests dollar store visits – I had no idea how much I loved the dollar store. Literally anything like emory boards, scissors, kitchen utensils, greeting cards, wrapping paper etc. is there for $1 compared to up to ten-times the price at WalMart or even Target for the same quality. It offers advice about pantry budgeting and free services like the public library, parks, and (gasp) walking around your neighborhood! I’d recommend it – I don’t agree with everything and I’m sure you won’t either, but it has some great ‘tune-up’ tips and advice to shave some spending dollars off your budget.
But after another month or two, I still need to get in front of the penny to penny spending. I realized the more I have to manually enter, the less I’m going to remember and then finally a short while later I will abandon the finance task all together. Then I stumbled upon Mint.com. (BACKSTORY: I was incredibly late doing my taxes this year and unfortunately was left with only one option on April 15th – TurboTax (I know right there contradicts my whole rant on finance control). After I finished and submitted my taxes it recommended I budget how to spend my refund with Mint.com. (Well jokes on your TurboTax because I didn’t have a refund after I paid your “free” filing fees! Oh wait… never mind.))
I thought ‘what the hell’ I’ll give this a gander and synced my multiple banking accounts with Mint.com (don’t worry I checked it wasn’t a scam or fraudulent site!). I instantly was very happy to have everything synced on the main dashboard, yet at the same moment I was sick to see how my spending looked. Here I was thinking I was budgeting ‘pretty-well’ and sticking to a ‘conservative’ budget. Literally within seconds it had sifted through ALL my transactions for the past few months and told me exactly where all the money I saved had gone. Well I guess I shouldn’t be surprised, I remember each transaction (that’s good I guess), but seeing it all right there made me realize that I was not as ‘informed’ as I thought.
Now don’t misunderstand, have no credit card debt, I’m not past due on anything, I have a good credit score and finally I have a consistent income – so things aren’t bad – not even close to it. But it is the small differences that make huge results so I needed help.
First thing Mint.com taught me: ATMs are for suckers. Literally imagine it just sucking money out of your pockets each time you use one. The fees! Come on! If it’s not my institution’s ATM (in network) I pay the ATM $2-3 then my bank gets mad that I cheated on them because I needed money and they charge me $2-3 also! What?! (It’s a genius business model I’m just mad I fund the revenues for it.) Think about it – if you pretend ATMs do not exist you will not lose money. For one you and I will not pay fees and two, it takes away the impulse cash spending ATMs condone. If you or I have to get the cash from a teller then it makes it ‘real’ and accounted for. I will most certainly think twice about what I’m spending when I have to go through the middleman of a teller to fund it. That also sets a ‘cash-budget’ once that money is gone – it’s gone. Remember ATMs don’t exist so you and I can’t go back for more immediately.
The second thing Mint.com taught me: make your money work for you. Find a CD or an IRA that is operating at higher returns – it might seem crazy to switch for small increases, but do the math – in 20, 30, 40 years those ‘minuscule’ increases are thousands and thousands of dollars in differences.
The third Mint.com wisdom: Honesty. It’s easy to pretend you’re ‘perfect’ that you’re doing all you can and that you don’t make mistakes financially, but that’s not true. Mint.com showed me the common and repetitive errors I was making that really do add up. It’s hard to admit I was being annihilated with ATM fees because I’m a smart girl and I ‘should know better,’ but I was.
There are always little tune-ups or tips that can make a difference in a budget. The key is to be honest about your money. It’s hard, sometimes embarrassing, and always sad to see how we spend our money – but it gives a great sense of power to our egos to know that we are aware of it. I’d encourage you to take a tour of Mint.com maybe read a few ‘alternative’ books on money management (not Suze Orman!). Remember, even if you think you’re in total control there’s always some area no matter how large or small that you could re-tool.
I promise I won’t be so absent from this anymore – goodness!
Oh and I decided not to spend money on my url domain name this year so I’m back to being http://www.tattoosandtarts.worpress.com