A Jar of Pennies…Planning My Future Budget

At the end of every day I empty out my pockets for loose change and throw it into an old Poland Spring 3 Liter bottle.

At first the change hit the empty bottom of the container loudly, but as the months passed it has gotten quieter and quieter as I put more money in. This makes me happier & happier.

This lil jar of change is my Mad Money stash because I believe everyone should have a little something for that rainy day. However, from the holidays and definitely what Michelle here as described as Lifestyle Inflation I almost brought my lil jar to the bank and cashed it out.

The plan for this lil jar will be future vacation or maybe the wedding dress of my dreams fund. Luckily I resisted the urge to cash it and realized I didn’t need more money…I needed a budget & the self-control to remain on that budget.

Hi Everyone, I’m a Chloe, from the blog Ergo, a 27 year old homeowner, who escaped of college without student loans & has a mediocre job. 

Throughout the past 2 years though I have been carelessly living with a credit card swipe here & everywhere to the point where I have depleted my entire Checking account. I do have a savings account cushion that I WILL NEVER TOUCH so I’m not in debt yet.

However, if I continue on with my compulsive shopping habits and careless behaviors it will be the road I will be on. Now the Matter at hand is “How to build my Checking Account back up & Budget.”

I’m compiled a Mini List of a Few Rules & Tidbits I’m going to use to Start of my New Year w/ Saving Money & building back up my checking account:

  1. Confront my Inner Battle between Need vs Want…
  2. Shutting off my television at night. I sleep w/ the TV on…It’s not good for my TV or my electric bill. Also, I plan to not turn on every light in the house… Only if I’m in the room will I leave the light on.
  3. Identify my Biggest Spending Habits. Lunch-hour. If I stayed in on my lunch hour, it would really make a difference. My biggest money culprit is eating Lunch Out & Lunch-time shopping. If I stayed in and walked around the Office Complex where I work, I’d get an extra work-out in too. This would kill 3 birds with one stone. A) Save Money by Brown-Bagging it. B.) Save Money by NOT shopping at the Nearby Mall & C.) Save Gas, which in turn saves money.
  4. Date Night Every Other Week or Once a Month. If my boyfriend and I go out to eat it is at least $40. We eat out a lot. If I cut back to having a Date Night Once a Month after 2 & half years of dating I think that would be okay. There are MANY cheaper alternatives to the classic Dinner & a Movie Date…I can’t wait to find them!
  5. Creating a Master Excel Expenses Spreadsheet – I plan on laying out ALL of my Expenses & using the nifty formulas to calculate exactly how much I can spend or not each month.
  6. The most important thing I have to remember is just because I have a coupon, DOES NOT MEAN I HAVE TO USE IT! Additionally, if it is On Sale, IT DOES NOT MEAN I HAVE TO BUY IT! I’m guilty of both…This ties into Need vs. Want.

 

With these as my starting point, I definitely need to visualize the reality of the situation and take off those rose colored glasses w/ my personal finances. I’m shaking my head & kicking myself that I let my checking account get in fact so low. But in any changing experience, identifying the problem is the first step.

What Are Some Changes You Are Going to Make in The New Year to Save Your Pennies?

Let The Chicks Hatch

I have to say… I never thought I’d be irresponsible with money. My mom and dad gave me a GREAT start into the financial world, and gave me every tool a parent could give for me to get and keep financial stability. I took less than $11,000 in student loans for a four year degree, I have a degree as a Respiratory Therapist in the “recession proof” health field, and I am married to a man who has never done less than provide a comfortable life for us. We had everything good going for us. It’s amazing how quickly the feeling of stability can fall away from you!

Here’s my first and hopefully ONLY major financial mistake:

I was only six months away from graduation when I decided that it wouldn’t be a bad idea to look at getting a new car. Fast forward a month, and I was the proud new “owner” of a 2010 GMC Terrain. Oh did I ever have stars in my eyes! A beautiful, nearly new SUV with good mpg’s was sitting in MY driveway. It was my early graduation present to myself, because who would ever think that a Respiratory Therapist would have a hard time finding a job? The payments were easily managed, and I would have a great paying job within six months for sure, right? Wrong. I wish someone would have slapped me and said:
http://www.jeffbullas.com/wp-content/uploads/2010/12/Are-You-Making-This-Huge-Mistake-On-Your-Blog.jpg
Hubs had been working the oil fields and was making great money, facilitating my feeling of comfort and security in our financial situation. Only problem? He was gone nearly three weeks of every month. I couldn’t hack it. I was a mess without him, so things HAD to change. We moved to another town, he had another stable, good paying job, but we also now had a rent payment. Bummer. I got a job to help out with my car payment, while his job covered every other expense. We were still treading water.

Now it’s graduation day! Oh how I’d been awaiting the moment to get my degree and my new high paying job! Well, again, life happens. The recession proof career I’d chosen, wasn’t so recession proof. I couldn’t find a job. I lived within an hour of THREE hospitals, and multiple home health companies, and there was nothing to even apply for. It was a shock, but I still had my part time job at Home Depot to rely on, so no big deal! We were still making it…barely. Hubby was miserable at his new job though, so we knew things had to change, and they had to change soon. This was about how he felt:
Source: http://ayearofsignficance.wordpress.com/2010/01/19/
We’ve now gotten all the way back to September, almost a year since we bought my pretty SUV. Our financial worries were there, but not screaming in our faces since we made just enough to pay everything and have a touch left over each month. There was no credit card debt, only two cars, two sets of student loans, and living costs. Things were ok. THEN…The call came. Someone wanted ME to apply.

I didn’t know there was an opening anywhere around us, but they had gotten my name, and wanted me. I applied, and actually landed the job! One problem though, it was far enough away that we had to move. Moving meant leaving our comfortable situation, leaving Tyler’s job, and leaving my job, and leaving our nice but cheap apartment. It meant taking risks. We took the chance. I moved September 10th into an apartment that would cost us DOUBLE what we paid in Idaho, and that wasn’t the only higher living expense we faced. Longer story short, we didn’t have a great plan to jump from. I was the only bread winner and we were BARELY scraping by, with two rent payments, and everything else on top of it.

Now fast forward to TODAY. I’m employed, hubs is employed, and we have a stable base again. But from the move and “life happening” we have over $5000 in credit card debt, $20,000 in car loans, $30,000+ in student loans between the two of us, and $1200 a month in rent. Now that we have the means, every cent is going towards repayment. No more credit cards for us. We’ve become a cash only family. We are SO lucky that this didn’t ruin our credit scores (somehow there was never a late payment), and we are so lucky it wasn’t worse. Depending on the month more than $1000 will now go toward extra debt payments and student loans, starting with the lowest amount/highest interest rate debt first, the credit cards. When that’s paid off, the normal payments to that rolls into the next lowest amount/highest interest until THAT’S gone, and so on. It will all be paid off within 5 years for sure, then we’ll be DEBT FREE.
 
Source: http://www.debtfree-and-in-the-black.com/baddebt.html

All in all, I can’t believe that I was immature enough to rely on my “future” job to get a car, but it’s all too common. I know I was lucky. We suffered no real losses, only true stress. I hope that people can learn from my mistake and NEVER count the chicks before they hatch, as they say. It has been a scary roller coaster and it’s FAR from over. We’re still in a somewhat precarious position, so I know we’re not out of the woods, but we’re for sure on the mend. We just have to pray month to month that nothing big happens to us or to our pup that will set our plan back further.

I’m Heather
A young twenty something wife, mommy to a fur baby, and a respiratory therapist. I blog to keep life in perspective and to connect with others! I blog over at The Life Unexpected, (heatherandtylerdraney.blogspot.com) and I hope you’ll take the time to stop in and say hi!

Self Employment: One’s Perspective

Michelle’s last article stirred up a great conversation regarding self employment.  As I was ready to leave a comment to chime in on the discussion, I realized that a simple comment wouldn’t do justice to explain my thoughts on self employment.

I’m a contributor for an entrepreneurial website called Under30CEO, and I frequently post topics regarding personal finance.  I’d like to think I had my fair share of business ventures stemming from my early child hood.  When I was in 2nd grade, I went around my neighborhood selling my personal unused toys.  I still remember exactly how much I made, a whopping $0.50!  Not bad for a second grader right?

In college, I took the free time I had to start a pressure washing company.  This was my first “real” venture out in the business world.  I had some money saved up from graduation gifts from high school, and I used the money to buy a brand new pressure washer along with supplies.  I went the whole nine yards: printed fliers, distributed, and went door to door in my neighborhood trying to get homeowners to hire me.  In the end, I broke even and ended up with a free pressure washer which I still use till this day.

When I graduated college, I went straight into the mortgage business.  A lot of my college friends asked me why I wanted to go into a career that didn’t necessarily require a degree.  My answer was simple: I was passionate about the real estate industry and I wanted to do something I loved.  While I was in this industry, I stumbled upon clients who desperately needed help with their credit card debts, and that’s why I started my venture with SpringCoin.

Throughout my entrepreneurial career, I’ve learned to pick up key things about living as an entrepreneur.  It’s a road less traveled, and it’s definitely not for the weak-hearted.

1.      Self employment does NOT equal freedom.  It’s quite the opposite actually.  Many of us might have false impressions that being self employed means you can do whatever you want.  If this is your only reason for wanting to be self employed, I’d think twice about it.   Our judgment is clouded when we see successful entrepreneurs who are living the dream, but trust me, they definitely earned this luxury.  Your friends will be enjoying their weekends relaxing, having a BBQ, and taking short weekend getaways.  As for you, you will constantly be working on your business and thinking of ways to improve it.

2.      Setting your own hours doesn’t mean 9-5.   If you decide to be your own boss, you should lead by example.  You should be the first one in the office and the last one out.  Being self employed requires you to be fully committed to your business.  As Michelle stated in her recent post, it requires a lot of self discipline since you have no one telling you what to do.

3.      Be prepared for the worst.  I can’t tell you how many times I felt like throwing in the towel.  We all have the grandiose vision of how our business is going to operate, but I guarantee you that nothing ever turns out the way you want it to be.  You will face challenges and you will feel defeated.  If you ask any of the successful entrepreneurs, they will tell you that they have failed countless number of times.

4.      Contemplate a business partner.  Studies show that having a business partner increases your chance of success. A business partner will be there to stop you from making mistakes and help you solve problems.  However, choosing the right business partner can be tough.  They must share the same vision, value and have the entrepreneurial spirit that you have.

5.      Be prepared to live frugal, more than ever expected. Being self employed means you might have to give up some of life’s luxury.  Since you’re not receiving a steady income, there could be months where you’re bringing in very little income.  It’s important to keep a close eye on your budget until your business is off the ground.

6.      Business credit cards might not be such a good idea.  I like to think of business credit cards as personal cards in disguise.  In order to get a business credit card, most banks require your business to be established for at least two years.  In order to get approved, most banks will make you personally guarantee this debt.  The worst part about it is that it won’t show up on your credit report even though you’ve been making timely payments, but it will only show up if you’ve made a late payment.

The media has skewed our perception on what it really means to be self-employed. The cold hard truth is that most business will fail within the last two years.  However, if you have the guts, persistence, and burning drive to be successful, the rewards at the end will be worthwhile.

Author Bio: Kevin is one of the Founders of SpringCoin and manages the SpringCoin blog.  He is a blogger for HuffPo and contributor for Under30CEO.